Huajun Holdings Ltd Net Income jumped on 95.6% in 2015 and Revenue surged on 10.4%
29/06/2015 • About Huajun Holdings Ltd (
$377) • By InTwits
Huajun Holdings Ltd reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Huajun Holdings Ltd doesn't have a profitable business model yet: FY2015 ROIC is 0.7%
- Huajun Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.9%. At the same time it's in pair with industry average of 6.6%.
- CAPEX is quite volatile: 53.7 in FY2015, 27.5 in FY2014, 26.2 in FY2013, 117 in FY2012, 32.0 in FY2011
- The company has potentially unprofitable business model: ROIC is at 0.7%
- It operates with high leverage: Net Debt/EBITDA is 9.9x while industry average is 0.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Huajun Holdings Ltd ($377) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 570.3 | 634.1 | 655.1 | 677.2 | 747.9 | 10.4% |
| Gross Profit | 107.6 | 110.8 | 127.7 | 119.6 | 166.6 | 39.3% |
| SG&A | | 105.4 | 114.0 | 123.9 | 153.4 | 23.8% |
| EBITDA | 50.8 | 47.4 | 54.4 | 38.6 | 56.1 | 45.3% |
| Net Income | 16.3 | 19.1 | -9.0 | 123.8 | 242.2 | 95.6% |
Balance Sheet
|
|---|
| Cash | 100.6 | 88.7 | 87.1 | 99.4 | 1,231.3 | 1,138.1% |
| Short Term Debt | 61.2 | 90.0 | 103.2 | 127.0 | 732.5 | 476.8% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 1,051.9 | |
Cash flow
|
|---|
| Capex | 32.0 | 116.9 | 26.2 | 27.5 | 53.7 | 95.0% |
Ratios
|
|---|
| Revenue growth | 9.8% | 11.2% | 3.3% | 3.4% | 10.4% | |
| EBITDA growth | -27.6% | -6.6% | 14.7% | -29.0% | 45.3% | |
| Gross Margin | 18.9% | 17.5% | 19.5% | 17.7% | 22.3% | 4.6% |
| EBITDA Margin | 8.9% | 7.5% | 8.3% | 5.7% | 7.5% | 1.8% |
| Net Income Margin | 2.9% | 3.0% | -1.4% | 18.3% | 32.4% | 14.1% |
| SG&A, % of revenue | | 16.6% | 17.4% | 18.3% | 20.5% | 2.2% |
| CAPEX, % of revenue | 5.6% | 18.4% | 4.0% | 4.1% | 7.2% | 3.1% |
| ROIC | 2.5% | 1.2% | 2.5% | -0.1% | 0.7% | 0.9% |
| ROE | 4.1% | 4.0% | -1.8% | 22.4% | 25.5% | 3.1% |
| Net Debt/EBITDA | -0.8x | 0.0x | 0.3x | 0.7x | 9.9x | 9.1x |
Revenue and profitability
The company's Revenue surged on 10.4% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.6 pp from -2.5% to -0.90% in FY2015.
Gross Margin increased on 4.6 pp from 17.7% to 22.3% in FY2015. SG&A as a % of Revenue increased on 2.2 pp from 18.3% to 20.5% in FY2015.
Net Income marign jumped on 14.1 pp from 18.3% to 32.4% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 the company had CAPEX/Revenue of 7.2%. CAPEX/Revenue dropped on 11.3 pp from 18.4% in FY2012 to 7.2% in FY2015. It's average CAPEX/Revenue for the last three years was 5.1%.To maintain this fast growth Huajun Holdings Ltd invested a large share of EBITDA (95.7%) to CAPEX.
Return on investment
The company operates at good ROE (25.51%) while ROIC is low (0.72%). ROIC increased slightly on 0.86 pp from -0.13% to 0.72% in FY2015. ROE increased on 3.1 pp from 22.4% to 25.5% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 9.9x and Debt / EBITDA is 31.8x. Net Debt / EBITDA surged on 9.1x from 0.7x to 9.9x in FY2015. Debt surged on 1,305% in FY2015 while cash surged on 1,138% in FY2015.
Appendix 1: Peers in Packaging&Containers
Below you can find Huajun Holdings Ltd benchmarking vs. other companies in Packaging&Containers 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 |
|---|
| China For You Group Co Ltd ($572) | 19.6% | -46.9% | -99.7% | 36,225.6% | |
| China Aluminum Cans Holdings Ltd ($6898) | 19.6% | 15.5% | -5.0% | 189.1% | |
| Zhengye International Holdings Co Ltd ($3363) | 10.5% | 6.8% | 16.4% | 18.6% | |
| Come Sure Group Holdings Ltd ($794) | 45.8% | 10.7% | -0.7% | 16.8% | |
| Greatview Aseptic Packaging Co Ltd ($468) | 35.7% | 10.8% | 23.8% | 3.3% | |
| |
|---|
| Median (17 companies) | 19.6% | 4.2% | 5.0% | 0.8% | 12.5% |
|---|
| Huajun Holdings Ltd ($377) | | 11.2% | 3.3% | 3.4% | 10.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huaxi Holdings Co Ltd ($1689) | 13.1% | 19.0% | 28.2% | 40.9% | 37.5% |
| Sheen Tai Holdings Grp Co Ltd ($1335) | 36.5% | 36.4% | 37.8% | 39.6% | |
| Jin Cai Holdings Co Ltd ($1250) | 39.6% | 36.6% | 39.1% | 37.7% | |
| China For You Group Co Ltd ($572) | 18.7% | 12.4% | | 34.6% | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 30.2% | 34.3% | 36.5% | 32.8% | |
| |
|---|
| Median (17 companies) | 18.4% | 19.9% | 20.3% | 22.3% | 28.2% |
|---|
| Huajun Holdings Ltd ($377) | 18.9% | 17.5% | 19.5% | 17.7% | 22.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sheen Tai Holdings Grp Co Ltd ($1335) | 35.5% | 31.9% | 32.2% | 32.1% | |
| Jin Cai Holdings Co Ltd ($1250) | 35.7% | 33.2% | 26.1% | 27.6% | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 25.5% | 27.9% | 30.7% | 27.4% | |
| Huaxi Holdings Co Ltd ($1689) | 7.8% | 14.5% | 21.2% | 27.1% | 29.1% |
| Greatview Aseptic Packaging Co Ltd ($468) | 24.1% | 25.9% | 23.1% | 21.6% | |
| |
|---|
| Median (18 companies) | 11.5% | 13.2% | 13.9% | 13.5% | 5.7% |
|---|
| Huajun Holdings Ltd ($377) | 8.9% | 7.5% | 8.3% | 5.7% | 7.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Aluminum Cans Holdings Ltd ($6898) | 1.3% | 6.9% | 9.5% | 20.7% | |
| Lee & Man Paper Manufacturing Ltd ($2314) | 13.5% | 19.7% | 13.7% | 13.1% | |
| Hao Tian Development Group Ltd ($474) | 88.2% | 81.6% | | 13.0% | 25.4% |
| CPMC Holdings Ltd ($906) | 13.7% | 16.7% | 19.7% | 8.6% | |
| Jin Bao Bao Holdings Ltd ($1239) | 3.8% | 5.2% | 3.3% | 8.3% | |
| |
|---|
| Median (18 companies) | 5.2% | 6.1% | 5.1% | 4.7% | 3.6% |
|---|
| Huajun Holdings Ltd ($377) | 5.6% | 18.4% | 4.0% | 4.1% | 7.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huaxi Holdings Co Ltd ($1689) | | 21.4% | 28.5% | 26.2% | 23.6% |
| Sheen Tai Holdings Grp Co Ltd ($1335) | 32.5% | 26.8% | 26.2% | 24.7% | |
| China Aluminum Cans Holdings Ltd ($6898) | 14.8% | 19.7% | 14.6% | 20.2% | |
| Greatview Aseptic Packaging Co Ltd ($468) | 19.6% | 20.2% | 18.9% | 15.7% | |
| Jin Cai Holdings Co Ltd ($1250) | 38.7% | 35.3% | 18.4% | 15.4% | |
| |
|---|
| Median (18 companies) | 11.3% | 7.9% | 6.7% | 6.3% | 3.0% |
|---|
| Huajun Holdings Ltd ($377) | 2.5% | 1.2% | 2.5% | -0.1% | 0.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Zhengye International Holdings Co Ltd ($3363) | 4.0x | 6.2x | 6.4x | 7.8x | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 0.7x | 9.4x | 6.7x | 7.4x | |
| Sino Haijing Holdings Ltd ($1106) | 4.7x | 6.4x | 6.1x | 6.2x | |
| Come Sure Group Holdings Ltd ($794) | -1.1x | 3.6x | 4.1x | 3.8x | |
| Lee & Man Paper Manufacturing Ltd ($2314) | 2.5x | 4.1x | 3.5x | 3.4x | |
| |
|---|
| Median (17 companies) | 0.7x | 1.1x | 0.8x | 0.3x | -0.3x |
|---|
| Huajun Holdings Ltd ($377) | -0.8x | 0.0x | 0.3x | 0.7x | 9.9x |
