China Merchants Land Ltd Net Income dropped on 51.2% in 2015 and Revenue dropped on 14.1%
26/02/2016 • About China Merchants Land Ltd (
$978) • By InTwits
China Merchants Land Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 19.7% in 2015, 24.4% in 2014, 38.4% in 2013, -20.9% in 2012, 567.8% in 2011
- China Merchants Land Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.6%.
- 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.
China Merchants Land Ltd ($978) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 67 | 147 | 6,928 | 7,440 | 6,395 | -14.1% |
| Gross Profit | 2 | -3 | 2,803 | 2,073 | 1,557 | -24.9% |
| SG&A | 36 | 26 | 220 | 265 | 318 | 20.0% |
| EBITDA | 379 | -31 | 2,658 | 1,818 | 1,262 | -30.6% |
| Net Income | 335 | -51 | 459 | 380 | 185 | -51.2% |
Balance Sheet
|
|---|
| Cash | 8 | 27 | 6,618 | 4,184 | 3,697 | -11.6% |
| Short Term Debt | 157 | 151 | 2,000 | 1,745 | 2,923 | 67.5% |
| Long Term Debt | 69 | 15 | 5,043 | 7,838 | 8,874 | 13.2% |
Cash flow
|
|---|
| Capex | 2 | 0 | 1 | 7 | 4 | -40.0% |
Ratios
|
|---|
| Revenue growth | -84.4% | 119.5% | 4,627.1% | 7.4% | -14.1% | |
| EBITDA growth | -158.5% | -108.1% | -8,767.4% | -31.6% | -30.6% | |
| Gross Margin | 3.1% | -1.7% | 40.5% | 27.9% | 24.3% | -3.5% |
| EBITDA Margin | 567.8% | -20.9% | 38.4% | 24.4% | 19.7% | -4.7% |
| Net Income Margin | 501.9% | -35.1% | 6.6% | 5.1% | 2.9% | -2.2% |
| SG&A, % of revenue | 53.2% | 17.8% | 3.2% | 3.6% | 5.0% | 1.4% |
| CAPEX, % of revenue | 2.7% | 0.2% | 0.0% | 0.1% | 0.1% | -0.0% |
| ROIC | 205.7% | -17.3% | 28.4% | 9.3% | 5.7% | -3.6% |
| ROE | | -199.2% | 17.6% | 7.8% | 3.8% | -4.0% |
| Net Debt/EBITDA | 0.6x | | 0.2x | 3.0x | 6.4x | 3.4x |
Revenue and profitability
The company's Revenue dropped on 14.1% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 4.7 pp from 24.4% to 19.7% in 2015.
Gross Margin decreased on 3.5 pp from 27.9% to 24.3% in 2015. SG&A as a % of Revenue increased slightly on 1.4 pp from 3.6% to 5.0% in 2015.
Net Income marign decreased on 2.2 pp from 5.1% to 2.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
China Merchants Land Ltd's CAPEX/Revenue was 0.070% in 2015. The company showed almost no change in CAPEX/Revenue from 2012 to 2015. For the last three years the average CAPEX/Revenue was 0.063%.
Return on investment
The company operates at low ROIC (5.69%) and ROE (3.80%). ROIC decreased on 3.6 pp from 9.3% to 5.7% in 2015. ROE decreased on 4.0 pp from 7.8% to 3.8% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 6.4x and Debt / EBITDA is 9.3x. Net Debt / EBITDA jumped on 3.4x from 3.0x to 6.4x in 2015. Debt jumped on 23.1% in 2015 while cash dropped on 11.6% in 2015.
Appendix 1: Peers in Real Estate
Below we provide China Merchants Land Ltd benchmarking against other companies in Real Estate 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 |
|---|
| Common Splendor International Health Industry Group Ltd ($286) | -0.9% | -0.5% | 1.9% | 4,120.2% | |
| Landsea Green Properties Co Ltd ($106) | -91.1% | -35.1% | -51.2% | 3,097.3% | |
| LVGEM China Real Estate Invest ($95) | -0.1% | -27.5% | -21.9% | 3,008.3% | |
| Rivera Holdings Ltd ($281) | 222.2% | 197.1% | -89.9% | 2,067.2% | |
| Ceneric Holdings Ltd ($542) | -94.0% | -73.9% | -49.8% | 1,922.5% | |
| |
|---|
| Median (172 companies) | 15.5% | 15.2% | 12.4% | 5.0% | 2.3% |
|---|
| China Merchants Land Ltd ($978) | | 119.5% | 4,627.1% | 7.4% | -14.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tern Properties Co Ltd ($277) | 96.9% | 96.7% | 98.4% | 98.4% | 98.7% |
| GR Properties Ltd ($108) | 37.4% | 39.3% | | 98.2% | |
| Renhe Commercial Holdings Co Ltd ($1387) | 71.1% | 79.0% | 95.2% | 97.9% | |
| YT Realty Group Ltd ($75) | 91.5% | 94.4% | 96.6% | 96.7% | |
| ITC Properties Group Ltd ($199) | 29.8% | 22.8% | 92.9% | 95.2% | 62.7% |
| |
|---|
| Median (154 companies) | 43.7% | 42.1% | 40.7% | 39.2% | 53.0% |
|---|
| China Merchants Land Ltd ($978) | 3.1% | -1.7% | 40.5% | 27.9% | 24.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| ITC Properties Group Ltd ($199) | 24.0% | -125.5% | -2,995.7% | 1,685.3% | -525.1% |
| Beijing Properties Holdings Ltd ($925) | 33.2% | -606.3% | 2,162.6% | 224.3% | |
| Chinese Estates Holdings Ltd ($127) | 340.9% | 356.2% | 91.6% | 195.5% | |
| Zall Development Group Ltd ($2098) | 73.6% | 105.3% | 133.1% | 143.2% | |
| Ceneric Holdings Ltd ($542) | -5.9% | -382.7% | -1,024.0% | 126.8% | |
| |
|---|
| Median (172 companies) | 35.2% | 28.9% | 27.9% | 26.9% | 34.5% |
|---|
| China Merchants Land Ltd ($978) | 567.8% | -20.9% | 38.4% | 24.4% | 19.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| LT Commercial Real Estate Ltd ($112) | 0.0% | 0.0% | 18.0% | 27,965.5% | |
| ITC Properties Group Ltd ($199) | 25.6% | 56.2% | 4,202.4% | 1,304.7% | 189.7% |
| Wanda Hotel Development Co Ltd ($169) | | 5.9% | 24.1% | 1,091.1% | |
| Pacific Century Premium Developments Ltd ($432) | 6.5% | 2.9% | 323.1% | 351.2% | 340.6% |
| Liu Chong Hing Investment Ltd ($194) | 9.4% | 18.5% | 6.1% | 269.7% | |
| |
|---|
| Median (173 companies) | 6.0% | 5.6% | 6.1% | 4.7% | 7.7% |
|---|
| China Merchants Land Ltd ($978) | 2.7% | 0.2% | 0.0% | 0.1% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rykadan Capital Ltd ($2288) | 17.2% | -1.8% | -2.6% | 48.4% | -3.7% |
| LVGEM China Real Estate Invest ($95) | 0.2% | -0.2% | -1.1% | 22.1% | |
| Zall Development Group Ltd ($2098) | 39.0% | 19.2% | 17.6% | 18.7% | |
| China Overseas Land & Investment Ltd ($688) | 18.0% | 18.4% | 15.1% | 18.5% | |
| Hong Kong Ferry Holdings Co Ltd ($50) | 4.7% | 3.8% | 0.6% | 18.0% | |
| |
|---|
| Median (176 companies) | 4.6% | 4.0% | 3.8% | 3.8% | 2.2% |
|---|
| China Merchants Land Ltd ($978) | 205.7% | -17.3% | 28.4% | 9.3% | 5.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Properties Group Ltd ($1838) | 16.9x | 43.0x | 21.4x | 1,523.0x | |
| SRE Group Ltd ($1207) | 10.6x | 14.1x | 24.7x | 1,184.6x | |
| Cheuk Nang Holdings Ltd ($131) | 53.2x | | 177.3x | 901.7x | |
| Tian An China Investment Co Ltd ($28) | 2.4x | 13.2x | 15.1x | 486.6x | |
| Greenland Hong Kong Holdings Ltd ($337) | 3.7x | | 6.2x | 49.3x | |
| |
|---|
| Median (139 companies) | 2.1x | 2.4x | 2.8x | 3.0x | 1.5x |
|---|
| China Merchants Land Ltd ($978) | 0.6x | | 0.2x | 3.0x | 6.4x |
