Global Link Communications Holdings Ltd revenue returned to growth in FY2015: increased 10.7% vs. 43.7% decline a year earliner
26/06/2015 • About Global Link Communications Holdings Ltd (
$8060) • By InTwits
Global Link Communications Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Global Link Communications Holdings Ltd doesn't have a profitable business model yet: FY2015 ROIC is -38.0%
- The company operates at negative EBITDA Margin: -53.8%
- Global Link Communications Holdings Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2011-FY2015 was 0.0%. On average EBITDA Margin was -4.9% for the sames years0
- Global Link Communications Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.0%.
- The company has unprofitable business model: ROIC is at -38.0%
- It operates with high leverage: Net Debt/EBITDA is 55.9x while industry average is 15.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Global Link Communications Holdings Ltd ($8060) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 111.5 | 79.4 | 121.1 | 68.1 | 75.4 | 10.7% |
| Gross Profit | 48.5 | 24.3 | 38.3 | 14.2 | 1.7 | -87.7% |
| SG&A | | 20.2 | 20.4 | 30.2 | 21.0 | -30.2% |
| EBITDA | 33.1 | 12.0 | 24.2 | -50.9 | -40.6 | -20.3% |
| Net Income | 29.3 | 13.4 | 19.3 | -56.8 | -42.5 | -25.3% |
Balance Sheet
|
|---|
| Cash | 44.4 | 42.0 | 31.7 | 29.3 | 18.7 | -36.2% |
| Short Term Debt | 10.9 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 1.4 | 0.9 | 0.0 | 0.1 | 1.7 | 1,263.1% |
Ratios
|
|---|
| Revenue growth | 24.3% | -28.8% | 52.6% | -43.7% | 10.7% | |
| EBITDA growth | 80.8% | -63.7% | 101.6% | -310.5% | -20.3% | |
| Gross Margin | 43.5% | 30.6% | 31.6% | 20.8% | 2.3% | -18.5% |
| EBITDA Margin | 29.7% | 15.1% | 20.0% | -74.7% | -53.8% | 20.9% |
| Net Income Margin | 26.3% | 16.9% | 15.9% | -83.4% | -56.3% | 27.1% |
| SG&A, % of revenue | | 25.5% | 16.8% | 44.3% | 27.9% | -16.4% |
| CAPEX, % of revenue | 1.3% | 1.2% | 0.0% | 0.2% | 2.2% | 2.0% |
| ROIC | 35.2% | 8.1% | 15.5% | -37.7% | -38.0% | -0.3% |
| ROE | 36.2% | 10.8% | 13.5% | -45.5% | -46.1% | -0.6% |
| Net Debt/EBITDA | -1.0x | -3.5x | -1.3x | | | 0.0x |
Revenue and profitability
The company's Revenue jumped on 10.7% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 74.1 pp from 24.4% to -49.7% in FY2015.
Gross Margin dropped on 18.5 pp from 20.8% to 2.3% in FY2015. SG&A as a % of Revenue dropped on 16.4 pp from 44.3% to 27.9% in FY2015.
Net Income marign surged on 27.1 pp from -83.4% to -56.3% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Global Link Communications Holdings Ltd had CAPEX/Revenue of 2.2%. The company's CAPEX/Revenue increased slightly on 1.0 pp from 1.2% in FY2012 to 2.2% in FY2015. It's average level of CAPEX/Revenue for the last three years was 0.81%.
Return on investment
The company operates at negative ROIC (-38.05%) and ROE (-46.11%). ROIC showed almost no change in FY2015. ROE decreased slightly on 0.60 pp from -45.5% to -46.1% in FY2015.
Leverage (Debt)
The company has no debt. Cash dropped on 36.2% in FY2015.
Appendix 1: Peers in Software
Below we provide Global Link Communications Holdings Ltd benchmarking against other companies in Software industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pizu Group Holdings Ltd ($8053) | -55.1% | 40.3% | -42.9% | 1,742.9% | |
| China City Railway Transportation Technology Holdings Co Ltd ($1522) | 194.6% | 164.0% | 33.6% | 100.5% | |
| China Mobile Games and Cultural Investment Ltd ($8081) | -16.7% | 393.7% | -6.6% | 92.2% | |
| Epicurean and Co Ltd ($8213) | | 177.0% | 185.7% | 62.6% | 22.0% |
| China Bio Cassava Holdings Ltd ($8129) | -15.0% | -14.2% | 38.8% | 55.1% | |
| |
|---|
| Median (30 companies) | 17.0% | 10.6% | 11.1% | 21.5% | 28.4% |
|---|
| Global Link Communications Holdings Ltd ($8060) | | -28.8% | 52.6% | -43.7% | 10.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Bio Cassava Holdings Ltd ($8129) | 90.2% | 90.4% | 97.4% | 98.4% | |
| NetDragon Websoft Inc ($777) | 90.1% | 93.4% | 90.8% | 89.3% | |
| China Mobile Games and Cultural Investment Ltd ($8081) | 19.4% | 6.5% | 45.3% | 84.8% | |
| Kingdee International Software Group Co Ltd ($268) | 70.1% | 65.0% | 75.3% | 82.5% | |
| Kingsoft Corp Ltd ($3888) | 85.5% | 86.8% | 86.3% | 82.4% | |
| |
|---|
| Median (29 companies) | 41.6% | 40.0% | 38.6% | 37.2% | 39.4% |
|---|
| Global Link Communications Holdings Ltd ($8060) | 43.5% | 30.6% | 31.6% | 20.8% | 2.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sinosoft Technology Group Ltd ($1297) | 55.5% | 62.6% | 54.9% | 57.2% | |
| International Entertainment Corp ($1009) | 235.1% | 50.8% | 64.0% | 54.9% | 62.0% |
| Microsoft Corp ($4338) | 42.8% | 33.5% | 39.2% | 38.0% | |
| Kingdee International Software Group Co Ltd ($268) | 19.5% | 7.8% | 33.2% | 37.2% | |
| TravelSky Technology Ltd ($696) | 43.3% | 38.1% | 35.8% | 31.9% | |
| |
|---|
| Median (30 companies) | 8.4% | 6.9% | 10.6% | 7.4% | 9.1% |
|---|
| Global Link Communications Holdings Ltd ($8060) | 29.7% | 15.1% | 20.0% | -74.7% | -53.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| NetDragon Websoft Inc ($777) | 13.3% | 21.1% | 34.6% | 54.6% | |
| China Eco-Farming Ltd ($8166) | 0.3% | 0.6% | 0.7% | 18.1% | |
| TravelSky Technology Ltd ($696) | 5.8% | 8.9% | 21.7% | 18.1% | |
| Kingsoft Corp Ltd ($3888) | 6.8% | 4.3% | 3.8% | 14.3% | |
| Sing Lee Software Group Ltd ($8076) | 19.4% | 3.3% | 0.2% | 14.0% | |
| |
|---|
| Median (29 companies) | 3.1% | 2.6% | 2.8% | 3.6% | 0.4% |
|---|
| Global Link Communications Holdings Ltd ($8060) | 1.3% | 1.2% | 0.0% | 0.2% | 2.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Microsoft Corp ($4338) | 43.4% | 28.6% | 30.3% | 26.2% | |
| Sinosoft Technology Group Ltd ($1297) | 31.6% | 34.0% | 21.9% | 20.2% | |
| Boyaa Interactive International Ltd ($434) | 100.4% | 75.3% | 21.3% | 20.0% | |
| ITE Holdings Ltd ($8092) | -19.6% | -15.0% | 10.6% | 16.8% | 19.8% |
| TravelSky Technology Ltd ($696) | 16.2% | 15.0% | 13.8% | 12.5% | |
| |
|---|
| Median (30 companies) | 1.6% | -2.7% | 1.9% | -0.4% | 2.2% |
|---|
| Global Link Communications Holdings Ltd ($8060) | 35.2% | 8.1% | 15.5% | -37.7% | -38.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pizu Group Holdings Ltd ($8053) | | | | 346.1x | |
| Epicurean and Co Ltd ($8213) | 2.9x | 2.3x | 4.7x | 12.3x | 12.0x |
| Sing Lee Software Group Ltd ($8076) | | | | 6.2x | |
| China Technology Solar Power Holdings Ltd ($8111) | | | 7.4x | 3.3x | 0.2x |
| Chinasoft International Ltd ($354) | -1.3x | -0.7x | 0.7x | 1.5x | |
| |
|---|
| Median (19 companies) | -0.7x | -0.7x | -1.0x | -0.8x | -1.3x |
|---|
