CEC International Holdings Ltd CAPEX jumped on 116% in 2015 and Revenue surged on 32.3%
30/07/2015 • About CEC International Holdings Ltd (
$759) • By InTwits
CEC International 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: 4.7% in FY2015, 5.6% in FY2014, 4.5% in FY2013, 7.8% in FY2012, 11.1% in FY2011
- CEC International Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.2%. At the same time it's a lot of higher than industry average of 13.7%.
- CAPEX is quite volatile: 168 in FY2015, 77.9 in FY2014, 129 in FY2013, 70.2 in FY2012, 68.3 in FY2011
- The company has potentially unprofitable business model: ROIC is at 3.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
CEC International Holdings Ltd ($759) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 642 | 796 | 1,280 | 1,831 | 2,422 | 32.3% |
| Gross Profit | 119 | 188 | 357 | 547 | 771 | 40.9% |
| SG&A | | | 120 | 136 | 155 | 14.2% |
| EBITDA | 71 | 62 | 57 | 103 | 114 | 10.4% |
| Net Income | 29 | 16 | 20 | 24 | 28 | 16.6% |
Balance Sheet
|
|---|
| Cash | 21 | 39 | 81 | 79 | 68 | -14.0% |
| Short Term Debt | 197 | 279 | 431 | 499 | 623 | 24.8% |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 68 | 70 | 129 | 78 | 168 | 115.8% |
Ratios
|
|---|
| Revenue growth | 19.5% | 23.9% | 60.8% | 43.0% | 32.3% | |
| EBITDA growth | -21.1% | -12.8% | -8.1% | 80.2% | 10.4% | |
| Gross Margin | 18.5% | 23.6% | 27.9% | 29.9% | 31.8% | 1.9% |
| EBITDA Margin | 11.1% | 7.8% | 4.5% | 5.6% | 4.7% | -0.9% |
| Net Income Margin | 4.5% | 1.9% | 1.6% | 1.3% | 1.1% | -0.2% |
| SG&A, % of revenue | | | 9.4% | 7.4% | 6.4% | -1.0% |
| CAPEX, % of revenue | 10.6% | 8.8% | 10.1% | 4.3% | 6.9% | 2.7% |
| ROIC | 3.3% | 2.7% | 0.9% | 4.3% | 3.5% | -0.9% |
| ROE | 6.5% | 3.3% | 4.1% | 4.6% | 5.1% | 0.5% |
| Net Debt/EBITDA | 2.5x | 3.9x | 6.1x | 4.1x | 4.9x | 0.8x |
Revenue and profitability
CEC International Holdings Ltd's Revenue jumped on 32.3% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 6.1 pp from 28.8% to 22.7% in 2015.
Gross Margin increased slightly on 1.9 pp from 29.9% to 31.8% in FY2015. SG&A as a % of Revenue decreased slightly on 1.0 pp from 7.4% to 6.4% in FY2015.
Net Income marign showed almost no change in FY2015.
Capital expenditures (CAPEX) and working capital investments
CEC International Holdings Ltd's CAPEX/Revenue was 6.9% in FY2015. CEC International Holdings Ltd showed small CAPEX/Revenue decline of 1.9 pp from 8.8% in FY2012 to 6.9% in FY2015. For the last three years the average CAPEX/Revenue was 7.1%.CEC International Holdings Ltd has spent a lot to CAPEX (148% of EBITDA) to secure its growth.
Return on investment
The company operates at low ROIC (3.45%) and ROE (5.08%). ROIC decreased slightly on 0.86 pp from 4.3% to 3.5% in FY2015. ROE showed almost no change in FY2015.
Leverage (Debt)
Debt level is 4.9x Net Debt / EBITDA and 5.5x Debt / EBITDA. Net Debt / EBITDA jumped on 0.8x from 4.1x to 4.9x in FY2015. Debt surged on 24.8% in FY2015 while cash dropped on 14.0% in FY2015.
Appendix 1: Peers in Electrical Compo&Equip
Below you can find CEC International Holdings Ltd benchmarking vs. other companies in Electrical Compo&Equip 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 |
|---|
| Enterprise Development Holdings Ltd ($1808) | 225.9% | 2.5% | 37.3% | 83.9% | |
| FDG Electric Vehicles Ltd ($729) | | -23.1% | -7.0% | 54.0% | 270.8% |
| Boer Power Holdings Ltd ($1685) | 11.4% | 20.4% | 10.9% | 51.3% | |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | -27.0% | -12.0% | 8.7% | 44.1% | |
| Solartech International Hldgs Ltd ($1166) | -6.5% | -13.4% | -1.8% | 33.7% | |
| |
|---|
| Median (31 companies) | 12.4% | -6.3% | 8.3% | 15.0% | 136.3% |
|---|
| CEC International Holdings Ltd ($759) | | 23.9% | 60.8% | 43.0% | 32.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Boer Power Holdings Ltd ($1685) | 37.1% | 36.8% | 36.0% | 35.3% | |
| China Titans Energy Technology Group Co Ltd ($2188) | 45.4% | 41.4% | 27.3% | 33.7% | |
| Sun King Power Electronics Group ($580) | 16.2% | 25.4% | 30.0% | 30.8% | |
| Johnson Electric Holdings Ltd ($179) | 27.5% | 27.3% | 28.0% | 29.5% | 29.6% |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | 16.1% | 14.2% | 20.1% | 26.0% | |
| |
|---|
| Median (30 companies) | 20.6% | 18.6% | 16.7% | 15.9% | 26.4% |
|---|
| CEC International Holdings Ltd ($759) | 18.5% | 23.6% | 27.9% | 29.9% | 31.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shougang Concord Technology Holdings ($521) | 22.7% | 12.3% | 28.1% | 31.9% | |
| Boer Power Holdings Ltd ($1685) | 28.1% | 26.3% | 27.8% | 28.5% | |
| China High Speed Transmission Equipment Group Co Ltd ($658) | 21.0% | 20.2% | 19.2% | 20.8% | |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | 9.2% | 5.7% | 7.4% | 16.9% | |
| Johnson Electric Holdings Ltd ($179) | 14.9% | 14.2% | 14.5% | 15.5% | 15.4% |
| |
|---|
| Median (32 companies) | 10.5% | 7.5% | 7.2% | 3.3% | -27.3% |
|---|
| CEC International Holdings Ltd ($759) | 11.1% | 7.8% | 4.5% | 5.6% | 4.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Applied Development Holdings Ltd ($519) | 46.4% | 79.7% | | 1,285.3% | |
| FDG Electric Vehicles Ltd ($729) | 177.5% | 374.3% | 82.3% | 71.1% | 417.0% |
| Sun King Power Electronics Group ($580) | 9.2% | 16.5% | 7.7% | 15.5% | |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | 23.7% | 23.1% | 50.7% | 13.5% | |
| Coslight Technology International Group Co Ltd ($1043) | 11.0% | 9.3% | 11.4% | 11.5% | |
| |
|---|
| Median (32 companies) | 9.3% | 5.7% | 4.9% | 3.6% | 211.3% |
|---|
| CEC International Holdings Ltd ($759) | 10.6% | 8.8% | 10.1% | 4.3% | 6.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Boer Power Holdings Ltd ($1685) | 18.2% | 18.0% | 17.0% | 21.2% | |
| Jiangnan Group Ltd ($1366) | 17.0% | 14.9% | 14.1% | 13.5% | |
| Johnson Electric Holdings Ltd ($179) | 13.1% | 11.7% | 11.6% | 12.7% | 11.2% |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | 5.1% | 1.8% | 3.0% | 10.4% | |
| Hengxin Technology Ltd ($1085) | 13.9% | 8.1% | 9.3% | 9.0% | |
| |
|---|
| Median (32 companies) | 6.2% | 2.8% | 3.0% | 0.6% | -0.7% |
|---|
| CEC International Holdings Ltd ($759) | 3.3% | 2.7% | 0.9% | 4.3% | 3.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tianneng Power International Ltd ($819) | 0.7x | 1.8x | 4.0x | 162.7x | |
| Coslight Technology International Group Co Ltd ($1043) | 11.2x | 51.9x | 8.7x | 54.7x | |
| China Titans Energy Technology Group Co Ltd ($2188) | 0.2x | 1.5x | | 16.9x | |
| Shougang Concord Technology Holdings ($521) | 12.7x | 16.3x | 4.9x | 13.8x | |
| Sun King Power Electronics Group ($580) | | 1.7x | 1.4x | 10.0x | |
| |
|---|
| Median (24 companies) | 0.3x | 1.5x | -0.2x | 1.5x | -1.5x |
|---|
| CEC International Holdings Ltd ($759) | 2.5x | 3.9x | 6.1x | 4.1x | 4.9x |
