Yuexiu Property Co Ltd reports 230% CAPEX growth and 40.8% Revenue growth
29/02/2016 • About Yuexiu Property Co Ltd (
$123) • By InTwits
Yuexiu Property Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 17.0% in 2015 vs. 29.2% in 2014 vs. 85.2% in 2011
- EBITDA Margin is quite volatile: 17.0% in 2015, 29.2% in 2014, 35.5% in 2013, 60.1% in 2012, 85.2% in 2011
- Yuexiu Property Co Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.0%. At the same time it's a lot of higher than industry average of 3.2%.
- CAPEX is quite volatile: 1,505 in 2015, 456 in 2014, 486 in 2013, 932 in 2012, 1,489 in 2011
- The company has potentially unprofitable business model: ROIC is at 5.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Yuexiu Property Co Ltd ($123) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 9,569 | 8,120 | 14,209 | 15,702 | 22,116 | 40.8% |
| Gross Profit | 4,004 | 3,858 | 4,104 | 4,138 | 4,659 | 12.6% |
| SG&A | 976 | 1,249 | 1,310 | 1,492 | 1,613 | 8.1% |
| EBITDA | 8,149 | 4,881 | 5,048 | 4,583 | 3,752 | -18.1% |
| Net Income | 5,236 | 2,482 | 2,880 | 2,471 | 1,013 | -59.0% |
Balance Sheet
|
|---|
| Cash | 4,821 | 7,060 | 5,055 | 7,883 | 9,546 | 21.1% |
| Short Term Debt | 10,591 | 6,829 | 8,331 | 8,415 | 5,512 | -34.5% |
| Long Term Debt | 11,191 | 13,302 | 15,535 | 23,644 | 32,653 | 38.1% |
Cash flow
|
|---|
| Capex | 1,489 | 932 | 486 | 456 | 1,505 | 230.4% |
Ratios
|
|---|
| Revenue growth | 69.8% | -15.1% | 75.0% | 10.5% | 40.8% | |
| EBITDA growth | 336.8% | -40.1% | 3.4% | -9.2% | -18.1% | |
| Gross Margin | 41.8% | 47.5% | 28.9% | 26.4% | 21.1% | -5.3% |
| EBITDA Margin | 85.2% | 60.1% | 35.5% | 29.2% | 17.0% | -12.2% |
| Net Income Margin | 54.7% | 30.6% | 20.3% | 15.7% | 4.6% | -11.2% |
| SG&A, % of revenue | 10.2% | 15.4% | 9.2% | 9.5% | 7.3% | -2.2% |
| CAPEX, % of revenue | 15.6% | 11.5% | 3.4% | 2.9% | 6.8% | 3.9% |
| ROIC | 18.5% | 9.7% | 9.3% | 7.1% | 5.0% | -2.1% |
| ROE | 29.0% | 11.7% | 12.4% | 9.3% | 3.4% | -5.8% |
| Net Debt/EBITDA | 2.1x | 2.7x | 3.7x | 5.3x | 7.6x | 2.4x |
Revenue and profitability
The company's Revenue jumped on 40.8% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 7.0 pp from 11.6% to 18.7% in 2015.
Gross Margin decreased on 5.3 pp from 26.4% to 21.1% in 2015. SG&A as a % of Revenue decreased on 2.2 pp from 9.5% to 7.3% in 2015.
Net Income marign dropped on 11.2 pp from 15.7% to 4.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Yuexiu Property Co Ltd had CAPEX/Revenue of 6.8%. CAPEX/Revenue decreased on 4.7 pp from 11.5% in 2012 to 6.8% in 2015. For the last three years the average CAPEX/Revenue was 4.4%.
Return on investment
The company operates at low ROIC (5.03%) and ROE (3.45%). ROIC decreased on 2.1 pp from 7.1% to 5.0% in 2015. ROE decreased on 5.8 pp from 9.3% to 3.4% in 2015.
Leverage (Debt)
Debt level is 7.6x Net Debt / EBITDA and 10.2x Debt / EBITDA. Net Debt / EBITDA surged on 2.4x from 5.3x to 7.6x in 2015. Debt surged on 19.0% in 2015 while cash surged on 21.1% in 2015.
Appendix 1: Peers in Real Estate
Below we provide Yuexiu Property Co 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) | 15.0% | 15.6% | 12.4% | 5.0% | 1.7% |
|---|
| Yuexiu Property Co Ltd ($123) | | -15.1% | 75.0% | 10.5% | 40.8% |
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% | 41.9% | 41.1% | 39.2% | 50.8% |
|---|
| Yuexiu Property Co Ltd ($123) | 41.8% | 47.5% | 28.9% | 26.4% | 21.1% |
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% | 26.4% | 34.3% |
|---|
| Yuexiu Property Co Ltd ($123) | 85.2% | 60.1% | 35.5% | 29.2% | 17.0% |
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) | 5.9% | 5.3% | 6.1% | 4.7% | 7.7% |
|---|
| Yuexiu Property Co Ltd ($123) | 15.6% | 11.5% | 3.4% | 2.9% | 6.8% |
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% | 3.9% | 3.8% | 3.8% | 2.2% |
|---|
| Yuexiu Property Co Ltd ($123) | 18.5% | 9.7% | 9.3% | 7.1% | 5.0% |
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 | 2.3x | 2.7x | 3.0x | 1.5x |
|---|
| Yuexiu Property Co Ltd ($123) | 2.1x | 2.7x | 3.7x | 5.3x | 7.6x |
