China Everbright International Ltd reports 206% CAPEX growth and 34.3% Revenue growth
29/02/2016 • About China Everbright International Ltd (
$257) • By InTwits
China Everbright International Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Everbright International Ltd is a growth stock: 2015 revenue growth was 34.3%, 5 year revenue CAGR was 23.8% at 2015 ROIC 10.8%
- China Everbright International Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.1%. At the same time it's in pair with industry average of 3.5%.
- CAPEX is quite volatile: 661 in 2015, 216 in 2014, 56.4 in 2013, 628 in 2012, 518 in 2011
- The company has business model with average profitability: ROIC is at 10.8%
- It operates with high leverage: Net Debt/EBITDA is 2.6x while industry average is 0.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Everbright International Ltd ($257) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 3,487 | 3,410 | 5,320 | 6,355 | 8,535 | 34.3% |
| Gross Profit | 1,438 | 1,684 | 2,375 | 2,969 | 3,909 | 31.7% |
| SG&A | 236 | 297 | 392 | 540 | 768 | 42.4% |
| EBITDA | 1,299 | 1,522 | 2,167 | 2,769 | 3,764 | 35.9% |
| Net Income | 801 | 1,123 | 1,325 | 1,703 | 2,085 | 22.4% |
Balance Sheet
|
|---|
| Cash | 1,684 | 2,750 | 5,771 | 4,918 | 6,118 | 24.4% |
| Short Term Debt | 1,064 | 1,635 | 1,780 | 2,611 | 3,410 | 30.6% |
| Long Term Debt | 4,206 | 4,369 | 5,141 | 6,525 | 12,411 | 90.2% |
Cash flow
|
|---|
| Capex | 518 | 628 | 56 | 216 | 661 | 205.6% |
Ratios
|
|---|
| Revenue growth | 19.0% | -2.2% | 56.0% | 19.5% | 34.3% | |
| EBITDA growth | 23.0% | 17.1% | 42.4% | 27.8% | 35.9% | |
| Gross Margin | 41.3% | 49.4% | 44.7% | 46.7% | 45.8% | -0.9% |
| EBITDA Margin | 37.3% | 44.6% | 40.7% | 43.6% | 44.1% | 0.5% |
| Net Income Margin | 23.0% | 32.9% | 24.9% | 26.8% | 24.4% | -2.4% |
| SG&A, % of revenue | 6.8% | 8.7% | 7.4% | 8.5% | 9.0% | 0.5% |
| CAPEX, % of revenue | 14.9% | 18.4% | 1.1% | 3.4% | 7.7% | 4.3% |
| ROIC | 11.1% | 10.4% | 11.2% | 10.5% | 10.8% | 0.3% |
| ROE | 13.9% | 15.5% | 12.2% | 11.5% | 12.5% | 1.0% |
| Net Debt/EBITDA | 2.8x | 2.1x | 0.5x | 1.5x | 2.6x | 1.1x |
Revenue and profitability
China Everbright International Ltd's Revenue jumped on 34.3% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.8 pp from 7.2% to 10.0% in 2015.
Gross Margin decreased slightly on 0.91 pp from 46.7% to 45.8% in 2015. SG&A as a % of Revenue increased slightly on 0.51 pp from 8.5% to 9.0% in 2015.
Net Income marign decreased on 2.4 pp from 26.8% to 24.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
China Everbright International Ltd's CAPEX/Revenue was 7.7% in 2015. China Everbright International Ltd's CAPEX/Revenue dropped on 10.7 pp from 18.4% in 2012 to 7.7% in 2015. For the last three years the average CAPEX/Revenue was 4.1%.
Return on investment
The company operates at good ROE (12.46%) while ROIC is low (10.75%). ROIC showed almost no change in 2015. ROE increased slightly on 0.97 pp from 11.5% to 12.5% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.6x and Debt / EBITDA is 4.2x. Net Debt / EBITDA jumped on 1.1x from 1.5x to 2.6x in 2015. Debt surged on 73.2% in 2015 while cash surged on 24.4% in 2015.
Management team
Chen Xiaoping is a China Everbright International Ltd's CEO. Chen Xiaoping has spent 17 years at the company. The company's CFO Wong Kam Chung "Raymond" has spent 15 years at the company.
Appendix 1: Peers in Environmental Control
Below you can find China Everbright International Ltd benchmarking vs. other companies in Environmental Control 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 Environmental Technology Holdings Ltd ($646) | -58.7% | 138.4% | -89.9% | 509.7% | |
| Capital Environment Holdings Ltd ($3989) | -89.7% | -12.6% | 1,503.8% | 241.2% | |
| CT Environmental Group Ltd ($1363) | 21.9% | -18.7% | 23.1% | 112.9% | |
| Asia Energy Logistics Group Ltd ($351) | | | | 92.2% | |
| Green Energy Group Ltd ($979) | 57.8% | -75.7% | 92.3% | 43.5% | |
| |
|---|
| Median (19 companies) | 17.3% | -12.6% | 7.5% | 3.5% | -7.7% |
|---|
| China Everbright International Ltd ($257) | | -2.2% | 56.0% | 19.5% | 34.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| EverChina International Holdings Co Ltd ($202) | 40.2% | 51.8% | 53.4% | 95.3% | 95.4% |
| China Environmental Resources Group Ltd ($1130) | 12.3% | 17.2% | 11.3% | 73.7% | 34.1% |
| CT Environmental Group Ltd ($1363) | 57.7% | 65.8% | 63.1% | 56.4% | |
| New Universe International Group Ltd ($8068) | 51.9% | 47.9% | 47.7% | 45.0% | |
| China Water Affairs Group Ltd ($855) | 42.7% | 44.0% | 43.1% | 41.8% | 47.3% |
| |
|---|
| Median (18 companies) | 32.8% | 25.3% | 30.3% | 28.8% | 34.1% |
|---|
| China Everbright International Ltd ($257) | 41.3% | 49.4% | 44.7% | 46.7% | 45.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CT Environmental Group Ltd ($1363) | 52.2% | 63.6% | 62.8% | 58.7% | |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 55.9% | 57.5% | 56.6% | 57.8% | |
| New Universe International Group Ltd ($8068) | 42.0% | 40.2% | 37.8% | 39.3% | |
| China Water Affairs Group Ltd ($855) | 38.8% | 38.2% | 38.1% | 37.1% | 40.3% |
| Sound Global Ltd ($967) | 25.5% | 24.2% | 23.8% | 24.0% | |
| |
|---|
| Median (19 companies) | 5.6% | 3.7% | 0.1% | -5.7% | -8.2% |
|---|
| China Everbright International Ltd ($257) | 37.3% | 44.6% | 40.7% | 43.6% | 44.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CT Environmental Group Ltd ($1363) | 31.8% | 65.0% | 27.1% | 51.4% | |
| New Universe International Group Ltd ($8068) | 103.4% | 16.4% | 16.6% | 44.9% | |
| Green Energy Group Ltd ($979) | 7.5% | 169.0% | 270.8% | 41.9% | |
| Integrated Waste Solutions Group Holdings Ltd ($923) | 25.4% | 13.2% | 10.6% | 41.7% | 88.1% |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 42.2% | 43.1% | 46.5% | 38.6% | |
| |
|---|
| Median (19 companies) | 11.0% | 13.2% | 16.1% | 16.2% | 17.1% |
|---|
| China Everbright International Ltd ($257) | 14.9% | 18.4% | 1.1% | 3.4% | 7.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CT Environmental Group Ltd ($1363) | 34.4% | 25.9% | 20.5% | 20.8% | |
| Sound Global Ltd ($967) | 15.0% | 12.8% | 11.5% | 10.8% | |
| Dongjiang Environmental Co Ltd ($895) | 17.0% | 14.3% | 7.4% | 9.4% | |
| New Universe International Group Ltd ($8068) | 5.8% | 6.3% | 6.8% | 8.9% | |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 7.4% | 7.1% | 6.8% | 7.8% | |
| |
|---|
| Median (19 companies) | 2.3% | -1.3% | -1.2% | -2.8% | -2.3% |
|---|
| China Everbright International Ltd ($257) | 11.1% | 10.4% | 11.2% | 10.5% | 10.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Water Affairs Group Ltd ($855) | 2.8x | 2.6x | 2.7x | 3.2x | 3.4x |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 4.1x | 4.2x | 3.1x | 2.9x | |
| Sound Global Ltd ($967) | -0.7x | -0.1x | 0.3x | 1.9x | |
| CT Environmental Group Ltd ($1363) | 1.8x | 2.4x | 0.5x | 1.9x | |
| Dongjiang Environmental Co Ltd ($895) | 1.0x | -1.7x | -1.5x | 0.9x | |
| |
|---|
| Median (9 companies) | 1.0x | 2.3x | 0.0x | 0.9x | 1.6x |
|---|
| China Everbright International Ltd ($257) | 2.8x | 2.1x | 0.5x | 1.5x | 2.6x |
