Wealth Glory Holdings Ltd revenue dropped on 12.4% in 2015 and EBITDA Margin decreased on 4.2 pp from -16.5% to -20.8%
26/06/2015 • About Wealth Glory Holdings Ltd (
$8269) • By InTwits
Wealth Glory Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Wealth Glory Holdings Ltd doesn't have a profitable business model yet: FY2015 ROIC is -43.3%
- The company operates at negative EBITDA Margin: -20.8%
- Wealth Glory Holdings Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2011-FY2015 is 0.0%. Average EBITDA Margin for the same period was -10.1%0
- Wealth Glory Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.6%. At the same time it's a lot of higher than industry average of 21.9%.
- CAPEX is quite volatile: 0.015 in FY2015, 2.9 in FY2014, 2.3 in FY2013, 7.5 in FY2012, 0.049 in FY2011
- The company has unprofitable business model: ROIC is at -43.3%
- It operates with high leverage: Net Debt/EBITDA is 9.1x while industry average is 0.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Wealth Glory Holdings Ltd ($8269) key annual financial indicators
| mln. | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 125.1 | 104.4 | 48.3 | 316.6 | 277.3 | -12.4% |
| Gross Profit | 37.5 | 25.6 | 7.9 | 4.7 | 6.6 | 41.5% |
| SG&A | | | 14.3 | 35.5 | 34.7 | -2.2% |
| EBITDA | 26.1 | 8.4 | -12.8 | -52.3 | -57.6 | 10.0% |
| Net Income | 25.0 | 7.7 | -13.9 | -159.4 | -202.6 | 27.1% |
Balance Sheet
|
|---|
| Cash | 46.8 | 86.7 | 31.5 | 18.9 | 9.4 | -50.2% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 18.8 | 16.8 | -10.4% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 103.4 | 27.6 | -73.3% |
Cash flow
|
|---|
| Capex | 0.0 | 7.5 | 2.3 | 2.9 | 0.0 | -99.5% |
Ratios
|
|---|
| Revenue growth | 22.3% | -16.5% | -53.8% | 555.7% | -12.4% | |
| EBITDA growth | 45.7% | -67.7% | -252.0% | 308.7% | 10.0% | |
| Gross Margin | 30.0% | 24.5% | 16.5% | 1.5% | 2.4% | 0.9% |
| EBITDA Margin | 20.9% | 8.1% | -26.5% | -16.5% | -20.8% | -4.2% |
| Net Income Margin | 20.0% | 7.4% | -28.7% | -50.3% | -73.1% | -22.7% |
| SG&A, % of revenue | | | 29.6% | 11.2% | 12.5% | 1.3% |
| CAPEX, % of revenue | 0.0% | 7.2% | 4.8% | 0.9% | 0.0% | -0.9% |
| ROIC | 59.5% | 9.4% | -11.2% | -37.2% | -43.3% | -6.1% |
| ROE | 58.2% | 9.3% | -11.0% | -147.3% | -238.6% | -91.4% |
| Net Debt/EBITDA | -1.8x | -10.3x | | | | 0.0x |
Revenue and profitability
The company's Revenue dropped on 12.4% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.4 pp from 8.0% to 11.4% in 2015.
Gross Margin increased slightly on 0.91 pp from 1.5% to 2.4% in FY2015. SG&A as a % of Revenue increased slightly on 1.3 pp from 11.2% to 12.5% in FY2015.
Net Income marign dropped on 22.7 pp from -50.3% to -73.1% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Wealth Glory Holdings Ltd had CAPEX/Revenue of 0.0054%. Wealth Glory Holdings Ltd's CAPEX/Revenue decreased on 7.2 pp from 7.2% in FY2012 to 0.0054% in FY2015. It's average level of CAPEX/Revenue for the last three years was 1.9%.
Return on investment
The company operates at negative ROIC (-43.27%) and ROE (-238.65%). ROIC decreased on 6.1 pp from -37.2% to -43.3% in FY2015. ROE dropped on 91.4 pp from -147% to -239% in FY2015.
Leverage (Debt)
Debt level is 9.1x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2015. Debt dropped on 63.6% in FY2015 while cash dropped on 50.2% in FY2015.
Appendix 1: Peers in Food
Below we provide Wealth Glory Holdings Ltd benchmarking against other companies in Food 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 |
|---|
| Natural Dairy NZ Holdings Ltd ($462) | 12.0% | -47.2% | 19.1% | 76.6% | |
| China Modern Dairy Holdings Ltd ($1117) | 88.8% | 50.7% | 96.1% | 52.8% | |
| China Huishan Dairy Holdings Co Ltd ($6863) | | 256.3% | 91.5% | 38.3% | 11.1% |
| Asia Cassava Resources Holdings Ltd ($841) | | -3.0% | 99.6% | 32.6% | -28.4% |
| YuanShengTai Dairy Farm Ltd ($1431) | 44,049.9% | 363.2% | 27.8% | 32.0% | |
| |
|---|
| Median (37 companies) | 21.5% | 9.8% | 6.4% | 0.4% | 1.1% |
|---|
| Wealth Glory Holdings Ltd ($8269) | | -16.5% | -53.8% | 555.7% | -12.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Honworld Group Ltd ($2226) | 42.2% | 57.2% | 59.0% | 57.8% | |
| Shenguan Holdings Group Ltd ($829) | 61.9% | 58.2% | 58.5% | 54.9% | |
| Yashili International Holdings Ltd ($1230) | 52.0% | 53.7% | 53.5% | 51.2% | |
| Natural Dairy NZ Holdings Ltd ($462) | 16.3% | -13.7% | 27.5% | 48.8% | |
| Christine International Holdings Ltd ($1210) | 51.3% | 50.2% | 49.7% | 47.2% | |
| |
|---|
| Median (37 companies) | 17.7% | 16.5% | 19.7% | 20.0% | 22.7% |
|---|
| Wealth Glory Holdings Ltd ($8269) | 30.0% | 24.5% | 16.5% | 1.5% | 2.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shenguan Holdings Group Ltd ($829) | 57.2% | 58.7% | 59.2% | 54.5% | |
| YuanShengTai Dairy Farm Ltd ($1431) | 147.8% | 40.3% | 48.4% | 47.1% | |
| China Huishan Dairy Holdings Co Ltd ($6863) | 109.2% | 45.1% | 47.9% | 47.1% | 37.2% |
| Honworld Group Ltd ($2226) | 28.4% | 44.4% | 42.1% | 42.0% | |
| China Modern Dairy Holdings Ltd ($1117) | 33.9% | 33.5% | 27.0% | 25.3% | |
| |
|---|
| Median (37 companies) | 8.5% | 7.8% | 6.7% | 7.6% | 9.5% |
|---|
| Wealth Glory Holdings Ltd ($8269) | 20.9% | 8.1% | -26.5% | -16.5% | -20.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Huishan Dairy Holdings Co Ltd ($6863) | 453.6% | 98.2% | 29.8% | 132.0% | 109.8% |
| Honworld Group Ltd ($2226) | 25.3% | 6.0% | 10.8% | 50.8% | |
| YuanShengTai Dairy Farm Ltd ($1431) | 182.5% | 26.1% | 18.3% | 43.4% | |
| Yashili International Holdings Ltd ($1230) | 3.6% | 8.2% | 7.1% | 20.1% | |
| Vedan International Holdings Ltd ($2317) | 2.8% | 2.5% | 2.4% | 18.8% | |
| |
|---|
| Median (37 companies) | 3.9% | 5.9% | 6.2% | 5.1% | 2.6% |
|---|
| Wealth Glory Holdings Ltd ($8269) | 0.0% | 7.2% | 4.8% | 0.9% | 0.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Honworld Group Ltd ($2226) | 22.1% | 50.4% | 44.5% | 23.6% | |
| Want Want China Holdings Ltd ($151) | 24.9% | 27.9% | 29.4% | 22.8% | |
| Shenguan Holdings Group Ltd ($829) | 40.6% | 40.0% | 33.2% | 21.4% | |
| Huisheng International Holdings Ltd ($1340) | 63.0% | 31.9% | 23.7% | 16.3% | |
| Asia Cassava Resources Holdings Ltd ($841) | 13.8% | 4.2% | 5.9% | 13.6% | 11.6% |
| |
|---|
| Median (37 companies) | 11.4% | 6.7% | 6.5% | 5.6% | 6.0% |
|---|
| Wealth Glory Holdings Ltd ($8269) | 59.5% | 9.4% | -11.2% | -37.2% | -43.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Yurun Food Group Ltd ($1068) | 0.4x | 40.7x | 6.9x | 9.4x | |
| Beijing Jingkelong Co Ltd ($814) | 3.4x | 5.0x | 4.8x | 5.3x | |
| CP Lotus Corp ($121) | 2.3x | | 6.5x | 5.1x | |
| DaChan Food Asia Ltd ($3999) | -0.3x | 0.1x | 1.3x | 4.8x | |
| First Pacific Co Ltd/Hong Kong ($142) | 1.3x | 1.8x | 3.8x | 4.5x | |
| |
|---|
| Median (30 companies) | 0.2x | -0.3x | 0.8x | 0.7x | 3.7x |
|---|
