KFM Kingdom Holdings Ltd CAPEX dropped on 29.3% in 2015 while Revenue increased on 9.8%
26/06/2015 • About KFM Kingdom Holdings Ltd (
$3816) • By InTwits
KFM Kingdom Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 9.5% in FY2015, 9.1% in FY2014, 9.7% in FY2013, 12.3% in FY2012, 21.1% in FY2011
- KFM Kingdom Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.4%. At the same time it's a lot of higher than industry average of 6.5%.
- CAPEX is quite volatile: 99.6 in FY2015, 141 in FY2014, 97.6 in FY2013, 44.2 in FY2012, 53.1 in FY2011
- The company has business model with low profitability: ROIC is at 7.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
KFM Kingdom Holdings Ltd ($3816) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 821 | 951 | 847 | 946 | 1,038 | 9.8% |
| Gross Profit | 249 | 235 | 205 | 208 | 250 | 20.1% |
| SG&A | | | 158 | 142 | 198 | 39.4% |
| EBITDA | 173 | 117 | 82 | 86 | 98 | 14.5% |
| Net Income | 125 | 94 | 40 | 36 | 31 | -13.5% |
Balance Sheet
|
|---|
| Cash | 122 | 133 | 219 | 105 | 159 | 50.5% |
| Short Term Debt | 37 | 113 | 211 | 151 | 198 | 31.3% |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 53 | 44 | 98 | 141 | 100 | -29.3% |
Ratios
|
|---|
| Revenue growth | 53.0% | 15.9% | -11.0% | 11.7% | 9.8% | |
| EBITDA growth | 186.1% | -32.2% | -30.0% | 4.3% | 14.5% | |
| Gross Margin | 30.3% | 24.6% | 24.3% | 22.0% | 24.0% | 2.1% |
| EBITDA Margin | 21.1% | 12.3% | 9.7% | 9.1% | 9.5% | 0.4% |
| Net Income Margin | 15.3% | 9.9% | 4.7% | 3.8% | 3.0% | -0.8% |
| SG&A, % of revenue | | | 18.6% | 15.0% | 19.1% | 4.1% |
| CAPEX, % of revenue | 6.5% | 4.6% | 11.5% | 14.9% | 9.6% | -5.3% |
| ROIC | 35.8% | 17.1% | 7.5% | 6.6% | 7.4% | 0.8% |
| ROE | 32.8% | 21.5% | 8.5% | 7.2% | 6.1% | -1.2% |
| Net Debt/EBITDA | -0.5x | -0.2x | -0.1x | 0.5x | 0.4x | -0.1x |
Revenue and profitability
KFM Kingdom Holdings Ltd's Revenue increased on 9.8% in FY2015. EBITDA Margin showed almost no change in FY2015.
Gross Margin increased on 2.1 pp from 22.0% to 24.0% in FY2015. SG&A as a % of Revenue increased on 4.1 pp from 15.0% to 19.1% in FY2015.
Net Income marign decreased slightly on 0.82 pp from 3.8% to 3.0% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 9.6%. The company showed CAPEX/Revenue growth of 4.9 pp from 4.6% in FY2012 to 9.6% in FY2015. Average CAPEX/Revenue for the last three years was 12.0%.The company investments to CAPEX were large: 101% of EBITDA.
Return on investment
The company operates at low ROIC (7.38%) and ROE (6.06%). ROIC increased slightly on 0.75 pp from 6.6% to 7.4% in FY2015. ROE decreased slightly on 1.2 pp from 7.2% to 6.1% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.4x and Debt / EBITDA is 2.0x. Net Debt / EBITDA dropped on 0.1x from 0.5x to 0.4x in FY2015. Debt jumped on 31.3% in FY2015 while cash surged on 50.5% in FY2015.
Appendix 1: Peers in Engineering&Construction
Below you can find KFM Kingdom Holdings Ltd benchmarking vs. other companies in Engineering&Construction industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Richly Field China Development Ltd ($313) | | | -45.0% | 464.2% | |
| Junefield Department Store Group Ltd ($758) | 22.9% | -20.3% | -24.9% | 126.6% | |
| CNQC International Holdings Ltd ($1240) | 401.9% | 21.6% | 91.0% | 103.7% | |
| Wison Engineering Services Co Ltd ($2236) | 1.2% | -2.9% | -24.9% | 90.3% | |
| China Resources and Transportation Group Ltd ($269) | | 939.8% | 3,196.3% | 87.9% | -41.6% |
| |
|---|
| Median (40 companies) | 14.0% | 9.7% | 21.8% | 13.6% | 18.2% |
|---|
| KFM Kingdom Holdings Ltd ($3816) | | 15.9% | -11.0% | 11.7% | 9.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huayu Expressway Group Ltd ($1823) | 2.2% | 43.6% | 65.6% | 64.0% | |
| HNA Infrastructure Company Ltd ($357) | 61.6% | 66.4% | 62.1% | 62.4% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 50.1% | 54.1% | 54.3% | 41.5% | |
| Grand Ming Group Holdings Ltd ($1271) | 20.4% | 11.0% | 18.1% | 35.7% | 19.7% |
| China Saite Group Co Ltd ($153) | 29.4% | 32.1% | 33.7% | 29.8% | |
| |
|---|
| Median (35 companies) | 11.0% | 11.0% | 11.7% | 11.9% | 9.5% |
|---|
| KFM Kingdom Holdings Ltd ($3816) | 30.3% | 24.6% | 24.3% | 22.0% | 24.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huayu Expressway Group Ltd ($1823) | -0.5% | 46.2% | 73.8% | 77.1% | |
| HNA Infrastructure Company Ltd ($357) | 60.0% | 62.8% | 63.7% | 62.8% | |
| Beijing Capital International Airport Co Ltd ($694) | 55.1% | 53.4% | 52.9% | 50.3% | |
| Cheung Kong Infrastructure Holdings Ltd ($1038) | 39.8% | 31.2% | 20.6% | 36.2% | |
| Grand Ming Group Holdings Ltd ($1271) | 17.5% | 10.0% | 15.8% | 31.0% | 19.0% |
| |
|---|
| Median (41 companies) | 7.5% | 8.3% | 7.1% | 5.7% | 3.7% |
|---|
| KFM Kingdom Holdings Ltd ($3816) | 21.1% | 12.3% | 9.7% | 9.1% | 9.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HNA Infrastructure Company Ltd ($357) | 43.3% | 36.8% | 5.7% | 85.4% | |
| PYI Corp Ltd ($498) | 6.6% | 3.7% | 4.2% | 24.5% | 13.1% |
| Shun Cheong Holdings ($650) | 7.2% | 16.4% | 8.0% | 23.9% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 6.1% | 4.2% | 7.7% | 20.2% | |
| China Resources and Transportation Group Ltd ($269) | 474.4% | 19.2% | 1.1% | 14.0% | 0.5% |
| |
|---|
| Median (41 companies) | 4.4% | 2.5% | 2.9% | 1.8% | 2.0% |
|---|
| KFM Kingdom Holdings Ltd ($3816) | 6.5% | 4.6% | 11.5% | 14.9% | 9.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chun Sing Engineering Holdings Ltd ($2277) | | | 98.3% | 54.9% | 43.7% |
| Ngai Shun Holdings Ltd ($1246) | | 68.8% | 77.2% | 45.2% | 31.0% |
| CNQC International Holdings Ltd ($1240) | 23.1% | 12.2% | 22.3% | 40.4% | |
| China Saite Group Co Ltd ($153) | 46.3% | 64.0% | 53.2% | 35.3% | |
| Excel Development Holdings Ltd ($1372) | | 33.1% | 27.2% | 16.4% | 8.6% |
| |
|---|
| Median (42 companies) | 6.9% | 5.5% | 5.1% | 3.6% | 2.7% |
|---|
| KFM Kingdom Holdings Ltd ($3816) | 35.8% | 17.1% | 7.5% | 6.6% | 7.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Resources and Transportation Group Ltd ($269) | | | | 66.7x | 29.7x |
| CNC Holdings Ltd ($8356) | -0.7x | | 22.0x | 21.9x | 24.3x |
| Deson Development International Holdings ($262) | 3.1x | 3.8x | 4.9x | 13.7x | 47.0x |
| Chun Wo Development Holdings Ltd ($711) | | 14.3x | 8.1x | 12.6x | 15.9x |
| Hsin Chong Construction Group Ltd ($404) | 4.3x | 1.8x | 8.0x | 10.2x | |
| |
|---|
| Median (34 companies) | 0.8x | 1.8x | 2.5x | 2.8x | 5.9x |
|---|
| KFM Kingdom Holdings Ltd ($3816) | -0.5x | -0.2x | -0.1x | 0.5x | 0.4x |
