Perfect Shape PRC Holdings Ltd demonstrated healthy growth over the last few years
06/07/2015 • About Perfect Shape PRC Holdings Ltd (
$1830) • By InTwits
Perfect Shape PRC Holdings Ltd is a fast-growing stock in Leisure Time industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.
Growth story
Perfect Shape PRC Holdings Ltd showed growth in the last financial year. The company's revenue surged on 55.0% in FY2015. At the same time Perfect Shape PRC Holdings Ltd well managed its profitability and showed even faster growth in EBITDA of 74.3% for the same period.
In the longer period the company showed fast revenue growth of 24.1% from FY2012 to FY2015 annualy. EBITDA surged on 27.4% from FY2012 to FY2015 annualy.
Perfect Shape PRC Holdings Ltd ($1830) financials for the last 5 years
| mln. HKD | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Revenue | 309 | 381 | 443 | 470 | 729 |
|---|
| Revenue growth, % | | 23.4% | 16.2% | 6.1% | 55.0% |
|---|
| SG&A, % | | | | | 10.1% |
|---|
| EBITDA | 81 | 105 | 129 | 124 | 217 |
|---|
| EBITDA growth, % | | 29.1% | 23.0% | -3.5% | 74.3% |
|---|
| EBITDA margin, % | 26.3% | 27.5% | 29.1% | 26.5% | 29.8% |
|---|
| Net Income | 50 | 69 | 78 | 83 | 135 |
|---|
| Net Income margin, % | 16.3% | 18.0% | 17.6% | 17.7% | 18.5% |
|---|
| |
| CAPEX | 24 | 23 | 39 | 36 | 181 |
|---|
| CAPEX/Revenue, % | 7.89% | 6.12% | 8.89% | 7.74% | 24.8% |
|---|
| Debt | 0 | 0 | 0 | 0 | 0 |
|---|
| Cash | 74 | 206 | 109 | 179 | 387 |
|---|
| Net Debt/EBITDA | -0.9x | -2.0x | -0.8x | -1.4x | -1.8x |
|---|
| |
| ROIC, % | 140.4% | 62.8% | 44.1% | 37.7% | 44.1% |
|---|
| ROE, % | 116.4% | 50.9% | 33.7% | 34.6% | 36.9% |
|---|
Profitability and return on investment
EBITDA growth was partly attributed to margin expansion. EBITDA margin surged on 3.30 pp from 26.5% to 29.8% in FY2015. In the longer period EBITDA margin increased on 2.30 pp from 27.5% in FY2012 to 29.8% in FY2015.
We call Perfect Shape PRC Holdings Ltd an attractive growth stock as together with the growth it delivers high ROIC at 44.1%. Three years ago it was considerably higher at 62.8%. It's average level of ROIC for the last three years was 42.0%.
The company's Net Income margin increased slightly on 0.800 pp from 17.7% to 18.5% in FY2015. In the longer period Perfect Shape PRC Holdings Ltd's Net Income margin increased slightly on 0.500 pp from 18% in FY2012 to 18.5% in FY2015.
Perfect Shape PRC Holdings Ltd operates at ROE of 36.9%. It's average ROE for the last three years was 35.1%.
Capital expenditures (CAPEX)
To fuel this fast growth the company had to invest in CAPEX.The company's CAPEX/Revenue was 24.8% in FY2015. The company's CAPEX/Revenue surged on 18.7 pp from 6.12% in FY2012 to 24.8% in FY2015. It's average CAPEX/Revenue for the last three years was 13.8%.
Leverage (Debt)
Having such a fast growth profile Perfect Shape PRC Holdings Ltd keeps negative net debt at -1.8x Net Debt/EBITDA. In the longer period Perfect Shape PRC Holdings Ltd's leverage surged on 0.18x from -1.96x in FY2012 to -1.79x in FY2015.
Valuation vs. comparable companies
The company trades at 6.5x EV/EBITDA which is 81.3% lower than 34.6x Leisure Time industry avearge calculated based on 12 companies. The market closed today at 13.3x P/E for Perfect Shape PRC Holdings Ltd which is 21.2% higher than 10.9x Leisure Time peer group avearge calculated on the basis of 3 companies.
For capital intensive compnanies it's worth taking a look at EV/(EBITDA-CAPEX) multiple. The company trades at 38.7x EV/(EBITDA-CAPEX) which is higher vs. -5.7x Leisure Time industry avearge calculated based on 3 companies.
Peers in Leisure Time
Below we provide Perfect Shape PRC Holdings Ltd benchmarking against other companies in Leisure Time 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, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Travel Expert Asia Enterprises Ltd ($1235) | | 11.9% | 15.3% | 19.5% | 18.9% |
| Water Oasis Group Ltd ($1161) | 8.1% | -16.3% | -23.7% | 8.0% | |
| Genting Hong Kong Ltd ($678) | 23.6% | 5.3% | 6.6% | 2.9% | |
| Vietnam Manufacturing & Export Processing Holdings Ltd ($422) | 9.5% | -24.4% | -15.5% | 2.8% | |
| China Travel International Investment Hong Kong Ltd ($308) | -2.5% | 7.2% | -6.6% | 2.6% | |
| |
|---|
| Median (9 companies) | 4.8% | 5.3% | -6.6% | 2.6% | 18.9% |
|---|
| Perfect Shape PRC Holdings Ltd ($1830) | | 23.4% | 16.2% | 6.1% | 55.0% |
Top companies by Gross margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Sino Splendid Holdings Ltd ($8006) | 55.1% | 51.7% | 51.4% | 51.9% | |
| China Travel International Investment Hong Kong Ltd ($308) | 48.2% | 46.1% | 47.8% | 46.0% | |
| China Jiuhao Health Industry Corp Ltd ($419) | 15.5% | 57.0% | 13.5% | 23.4% | |
| Sino Golf Holdings Ltd ($361) | 15.7% | 11.7% | 17.4% | 18.1% | |
| Vietnam Manufacturing & Export Processing Holdings Ltd ($422) | 17.5% | 10.9% | 7.8% | 6.7% | |
| |
|---|
| Median (6 companies) | 17.5% | 46.1% | 17.4% | 20.7% | 90.7% |
|---|
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| China Travel International Investment Hong Kong Ltd ($308) | 25.6% | 28.2% | 29.1% | 48.5% | |
| Travel Expert Asia Enterprises Ltd ($1235) | 20.1% | 17.4% | 16.2% | 18.3% | 15.0% |
| Water Oasis Group Ltd ($1161) | 11.3% | 6.5% | 4.7% | 11.4% | |
| Genting Hong Kong Ltd ($678) | 24.2% | 23.1% | 8.5% | 8.6% | |
| Sino Golf Holdings Ltd ($361) | 5.7% | 4.3% | 10.4% | 7.8% | |
| |
|---|
| Median (9 companies) | 7.5% | 6.5% | 4.7% | 7.8% | 15.0% |
|---|
| Perfect Shape PRC Holdings Ltd ($1830) | 26.3% | 27.5% | 29.1% | 26.5% | 29.8% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| China Jiuhao Health Industry Corp Ltd ($419) | 4.2% | 2.1% | 31.8% | 67.3% | |
| Genting Hong Kong Ltd ($678) | 7.3% | 16.6% | 25.4% | 33.0% | |
| China Travel International Investment Hong Kong Ltd ($308) | 14.6% | 13.4% | 28.3% | 29.9% | |
| Sino Golf Holdings Ltd ($361) | 1.8% | 3.0% | 2.8% | 3.2% | |
| Water Oasis Group Ltd ($1161) | 2.7% | 3.7% | 4.0% | 2.8% | |
| |
|---|
| Median (9 companies) | 2.7% | 3.0% | 4.0% | 2.8% | 2.8% |
|---|
| Perfect Shape PRC Holdings Ltd ($1830) | 7.9% | 6.1% | 8.9% | 7.7% | 24.8% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Travel Expert Asia Enterprises Ltd ($1235) | 179.4% | 50.9% | 26.7% | 29.8% | 23.0% |
| Water Oasis Group Ltd ($1161) | 21.6% | 5.3% | 1.7% | 15.7% | |
| China Travel International Investment Hong Kong Ltd ($308) | 4.6% | 5.6% | 5.0% | 9.6% | |
| Sino Golf Holdings Ltd ($361) | -0.5% | -1.9% | 6.8% | 3.8% | |
| Genting Hong Kong Ltd ($678) | 2.1% | 2.0% | -1.0% | -1.1% | |
| |
|---|
| Median (9 companies) | 2.1% | 0.3% | -1.0% | -1.1% | 23.0% |
|---|
| Perfect Shape PRC Holdings Ltd ($1830) | 140.4% | 62.8% | 44.1% | 37.7% | 44.1% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Sino Golf Holdings Ltd ($361) | 7.3x | 10.0x | 1.9x | 3.0x | |
| China Travel International Investment Hong Kong Ltd ($308) | -2.4x | -1.7x | -1.1x | -1.1x | |
| Travel Expert Asia Enterprises Ltd ($1235) | -2.3x | -1.3x | -1.2x | -1.7x | -0.3x |
| Water Oasis Group Ltd ($1161) | -2.2x | -3.2x | -5.1x | -2.8x | |
| Genting Hong Kong Ltd ($678) | 1.6x | 3.3x | -4.0x | -5.3x | |
| |
|---|
| Median (5 companies) | -2.3x | 1.0x | -1.2x | -1.7x | -0.3x |
|---|
| Perfect Shape PRC Holdings Ltd ($1830) | -0.9x | -2.0x | -0.8x | -1.4x | -1.8x |
