Chong Hing Bank Ltd Net Income dropped on 56.5% in 2015 and Revenue dropped on 17.4%
24/02/2016 • About Chong Hing Bank Ltd (
$1111) • By InTwits
Chong Hing Bank Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Chong Hing Bank Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.1%. At the same time it's a lot of higher than industry average of 3.4%.
- CAPEX is quite volatile: 72.2 in 2015, 33.9 in 2014, 33.1 in 2013, 70.1 in 2012, 248 in 2011
- The company has potentially unprofitable business model: ROIC is at 5.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Chong Hing Bank Ltd ($1111) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,933 | 2,127 | 2,103 | 4,649 | 3,842 | -17.4% |
| Net Income | 561 | 543 | 557 | 2,742 | 1,193 | -56.5% |
Balance Sheet
|
|---|
| Cash | 9,941 | 6,859 | 4,356 | 4,555 | 8,938 | 96.2% |
| Short Term Debt | 1,087 | 1,843 | 1,674 | 4,414 | 5,728 | 29.8% |
| Long Term Debt | 1,852 | 1,899 | 1,766 | 1,816 | 1,820 | 0.2% |
Cash flow
|
|---|
| Capex | 248 | 70 | 33 | 34 | 72 | 113.0% |
Ratios
|
|---|
| Revenue growth | 14.2% | 10.0% | -1.2% | 121.1% | -17.4% | |
| Net Income Margin | 29.0% | 25.5% | 26.5% | 59.0% | 31.1% | -27.9% |
| CAPEX, % of revenue | 12.8% | 3.3% | 1.6% | 0.7% | 1.9% | 1.1% |
| ROIC | 6.3% | 5.5% | 5.2% | 16.4% | 5.7% | -10.7% |
| ROE | 8.3% | 7.6% | 7.4% | 33.8% | 9.8% | -24.1% |
Revenue and profitability
Chong Hing Bank Ltd's Revenue dropped on 17.4% in 2015.
Net Income marign dropped on 27.9 pp from 59.0% to 31.1% in 2015.
Capital expenditures (CAPEX) and working capital investments
Chong Hing Bank Ltd's CAPEX/Revenue was 1.9% in 2015. CAPEX/Revenue decreased slightly on 1.4 pp from 3.3% in 2012 to 1.9% in 2015. Average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at low ROIC (5.72%) and ROE (9.80%). ROIC dropped on 10.7 pp from 16.4% to 5.7% in 2015. ROE dropped on 24.1 pp from 33.8% to 9.8% in 2015.
Leverage (Debt)
Debt jumped on 21.2% in 2015 while cash jumped on 96.2% in 2015.
Appendix 1: Peers in Banks
Below we provide Chong Hing Bank Ltd benchmarking against other companies in Banks 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 |
|---|
| China Merchants Bank Co Ltd ($3968) | 42.3% | 24.0% | 18.6% | 33.9% | |
| Harbin Bank Co Ltd ($6138) | 104.6% | 58.3% | 12.1% | 29.2% | |
| Dah Sing Financial Holdings Ltd ($440) | 15.3% | 9.9% | -0.1% | 29.0% | |
| China CITIC Bank Corp Ltd ($998) | 46.7% | 30.5% | 19.5% | 29.0% | |
| Bank of Chongqing Co Ltd ($1963) | 51.8% | 38.4% | 26.6% | 28.4% | |
| |
|---|
| Median (20 companies) | 36.1% | 21.6% | 10.4% | 13.8% | -5.3% |
|---|
| Chong Hing Bank Ltd ($1111) | | 10.0% | -1.2% | 121.1% | -17.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Minsheng Banking Corp Ltd ($1988) | 5.0% | 5.2% | 6.8% | 7.6% | |
| Harbin Bank Co Ltd ($6138) | 20.0% | 19.8% | 9.9% | 6.5% | |
| Industrial & Commercial Bank of China Ltd ($1398) | 3.2% | 3.8% | 4.9% | 5.4% | |
| Bank of Communications Co Ltd ($3328) | 3.1% | 3.6% | 5.1% | 5.3% | |
| China CITIC Bank Corp Ltd ($998) | 1.7% | 2.3% | 2.9% | 4.8% | |
| |
|---|
| Median (20 companies) | 3.2% | 3.6% | 4.1% | 3.1% | 1.6% |
|---|
| Chong Hing Bank Ltd ($1111) | 12.8% | 3.3% | 1.6% | 0.7% | 1.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Construction Bank Corp ($939) | 11.6% | 11.1% | 11.7% | 10.8% | |
| Industrial & Commercial Bank of China Ltd ($1398) | 10.6% | 9.9% | 10.2% | 9.9% | |
| Agricultural Bank of China Ltd ($1288) | 10.3% | 9.9% | 10.0% | 9.3% | |
| Hang Seng Bank Ltd ($11) | 9.0% | 8.6% | 9.5% | 9.0% | 8.3% |
| Bank of China Ltd ($3988) | 6.3% | 6.2% | 6.3% | 6.2% | |
| |
|---|
| Median (20 companies) | 6.4% | 6.1% | 6.3% | 5.3% | 3.1% |
|---|
| Chong Hing Bank Ltd ($1111) | 6.3% | 5.5% | 5.2% | 16.4% | 5.7% |
