Hong Kong Food Investment Holdings Ltd Net Income dropped on 14.7% in 2015 while EBITDA Margin increased slightly on 1.6 pp from -9.1% to -7.5%
29/06/2015 • About Hong Kong Food Investment Holdings Ltd (
$60) • By InTwits
Hong Kong Food Investment Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Hong Kong Food Investment Holdings Ltd is a company in decline: FY2015 revenue growth was -6.4%, 5 years revenue CAGR was -17.3%
- The company operates at negative EBITDA Margin: -7.5%
- Hong Kong Food Investment 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 -7.8%0
- Hong Kong Food Investment Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.6%. At the same time it's in pair with industry average of 3.7%.
- CAPEX is quite volatile: 0.94 in FY2015, 8.0 in FY2014, 15.1 in FY2013, 0.20 in FY2012, 0.61 in FY2011
- The company has unprofitable business model: ROIC is at -3.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Hong Kong Food Investment Holdings Ltd ($60) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 439.5 | 711.9 | 386.1 | 231.6 | 216.8 | -6.4% |
| Gross Profit | 0.7 | -14.0 | -7.6 | 24.6 | 21.9 | -11.2% |
| SG&A | | | 45.5 | 52.5 | 45.7 | -13.0% |
| EBITDA | -26.8 | -41.2 | -48.6 | -21.2 | -16.3 | -23.1% |
| Net Income | -5.9 | -37.2 | -23.6 | 25.3 | 21.6 | -14.7% |
Balance Sheet
|
|---|
| Cash | 64.4 | 64.0 | 65.9 | 42.3 | 49.4 | 16.7% |
| Short Term Debt | 148.2 | 255.3 | 183.8 | 147.8 | 164.2 | 11.1% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.6 | 0.2 | 15.1 | 8.0 | 0.9 | -88.2% |
Ratios
|
|---|
| Revenue growth | -21.4% | 62.0% | -45.8% | -40.0% | -6.4% | |
| EBITDA growth | -768.9% | 53.5% | 17.9% | -56.4% | -23.1% | |
| Gross Margin | 0.2% | -2.0% | -2.0% | 10.6% | 10.1% | -0.5% |
| EBITDA Margin | -6.1% | -5.8% | -12.6% | -9.1% | -7.5% | 1.6% |
| Net Income Margin | -1.3% | -5.2% | -6.1% | 10.9% | 9.9% | -1.0% |
| SG&A, % of revenue | | | 11.8% | 22.7% | 21.1% | -1.6% |
| CAPEX, % of revenue | 0.1% | 0.0% | 3.9% | 3.4% | 0.4% | -3.0% |
| ROIC | -5.2% | -6.8% | -8.2% | -4.7% | -3.9% | 0.8% |
| ROE | -1.2% | -8.3% | -5.7% | 6.1% | 4.9% | -1.1% |
Revenue and profitability
Hong Kong Food Investment Holdings Ltd's Revenue decreased on 6.4% in FY2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.6 pp from -9.1% to -7.5% in FY2015.
Gross Margin decreased slightly on 0.55 pp from 10.6% to 10.1% in FY2015. SG&A as a % of Revenue decreased slightly on 1.6 pp from 22.7% to 21.1% in FY2015.
Net Income marign decreased slightly on 0.97 pp from 10.9% to 9.9% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 0.43%. The company showed almost no change in CAPEX/Revenue from FY2012 to FY2015. It's average CAPEX/Revenue for the last three years was 2.6%.
Return on investment
The company operates at negative ROIC (-3.88%) and low but positive ROE (4.95%). ROIC increased slightly on 0.84 pp from -4.7% to -3.9% in FY2015. ROE decreased slightly on 1.1 pp from 6.1% to 4.9% in FY2015.
Leverage (Debt)
Debt level is -2.0x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2015. Debt jumped on 11.1% in FY2015 while cash jumped on 16.7% in FY2015.
Appendix 1: Peers in Food
Below you can find Hong Kong Food Investment Holdings Ltd benchmarking vs. other companies in Food 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 |
|---|
| Wealth Glory Holdings Ltd ($8269) | | -16.5% | -53.8% | 555.7% | -12.4% |
| 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% |
| |
|---|
| Median (37 companies) | 22.5% | 9.4% | 6.4% | 2.7% | -0.1% |
|---|
| Hong Kong Food Investment Holdings Ltd ($60) | | 62.0% | -45.8% | -40.0% | -6.4% |
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) | 18.1% | 16.8% | 19.7% | 20.0% | 22.7% |
|---|
| Hong Kong Food Investment Holdings Ltd ($60) | 0.2% | -2.0% | -2.0% | 10.6% | 10.1% |
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) | 8.8% | 7.9% | 6.7% | 7.6% | 8.0% |
|---|
| Hong Kong Food Investment Holdings Ltd ($60) | -6.1% | -5.8% | -12.6% | -9.1% | -7.5% |
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% | 6.0% | 6.2% | 5.1% | 2.6% |
|---|
| Hong Kong Food Investment Holdings Ltd ($60) | 0.1% | 0.0% | 3.9% | 3.4% | 0.4% |
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) | 11.9% | 7.6% | 6.5% | 5.6% | 6.0% |
|---|
| Hong Kong Food Investment Holdings Ltd ($60) | -5.2% | -6.8% | -8.2% | -4.7% | -3.9% |
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) | 0.0x | -0.4x | 0.8x | 0.7x | 2.2x |
|---|
