Century Ginwa Retail Holdings Ltd reports 101% Net Income decline and 4.4 pp EBITDA Margin decline from 26.3% to 22.0%
01/03/2016 • About Century Ginwa Retail Holdings Ltd (
$162) • By InTwits
Century Ginwa Retail Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Century Ginwa Retail Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.3%. At the same time it's a lot of higher than industry average of 6.6%.
- CAPEX is quite volatile: 111 in 2015, 270 in 2014, 160 in 2013, 78.1 in 2012, 72.9 in 2011
- The company has potentially unprofitable business model: ROIC is at 2.1%
- It operates with high leverage: Net Debt/EBITDA is 7.3x while industry average is -0.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Century Ginwa Retail Holdings Ltd ($162) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,299 | 1,740 | 1,872 | 1,722 | 1,568 | -9.0% |
| Gross Profit | 902 | 1,157 | 1,225 | 1,062 | 941 | -11.5% |
| EBITDA | 241 | 701 | 630 | 453 | 344 | -24.1% |
| Net Income | 215 | 423 | 444 | 120 | -1 | -101.1% |
Balance Sheet
|
|---|
| Cash | 120 | 628 | 208 | 215 | 165 | -22.9% |
| Short Term Debt | 106 | 837 | 435 | 1,445 | 1,910 | 32.2% |
| Long Term Debt | 1,572 | 1,224 | 1,353 | 945 | 751 | -20.5% |
Cash flow
|
|---|
| Capex | 73 | 78 | 160 | 270 | 111 | -59.0% |
Ratios
|
|---|
| Revenue growth | 85.9% | 34.0% | 7.5% | -8.0% | -9.0% | |
| EBITDA growth | 84.0% | 190.1% | -10.1% | -28.0% | -24.1% | |
| Gross Margin | 69.4% | 66.5% | 65.4% | 61.7% | 60.0% | -1.7% |
| EBITDA Margin | 18.6% | 40.3% | 33.7% | 26.3% | 22.0% | -4.4% |
| Net Income Margin | 16.6% | 24.3% | 23.7% | 7.0% | -0.1% | -7.1% |
| CAPEX, % of revenue | 5.6% | 4.5% | 8.5% | 15.7% | 7.1% | -8.6% |
| ROIC | 6.5% | 11.4% | 6.4% | 3.9% | 2.1% | -1.8% |
| ROE | 26.1% | 15.4% | 9.9% | 2.4% | -0.0% | -2.4% |
| Net Debt/EBITDA | 6.5x | 2.0x | 2.5x | 4.8x | 7.3x | 2.5x |
Revenue and profitability
Century Ginwa Retail Holdings Ltd's Revenue decreased on 9.0% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 4.4 pp from 26.3% to 22.0% in 2015.
Gross Margin decreased slightly on 1.7 pp from 61.7% to 60.0% in 2015.
Net Income marign decreased on 7.1 pp from 7.0% to -0.081% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 7.1%. The company showed CAPEX/Revenue growth of 2.6 pp from 4.5% in 2012 to 7.1% in 2015. It's average level of CAPEX/Revenue for the last three years was 10.4%.
Return on investment
The company operates at low but positive ROIC (2.08%) and negative ROE (-0.02%). ROIC decreased slightly on 1.8 pp from 3.9% to 2.1% in 2015. ROE decreased on 2.4 pp from 2.4% to -0.024% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 7.3x and Debt / EBITDA is 7.7x. Net Debt / EBITDA jumped on 2.5x from 4.8x to 7.3x in 2015. Debt jumped on 11.3% in 2015 while cash dropped on 22.9% in 2015.
Appendix 1: Peers in Retail
Below you can find Century Ginwa Retail Holdings Ltd benchmarking vs. other companies in Retail 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 Household Holdings Ltd ($692) | -87.0% | -32.8% | 5,357.9% | 76.2% | |
| Ming Fung Jewellery Group Ltd ($860) | | 3.3% | -14.9% | 54.3% | -70.8% |
| Merry Garden Holdings Ltd ($1237) | 53.9% | 37.1% | 12.8% | 47.6% | |
| Luk Fook Holdings International Ltd ($590) | | 47.2% | 12.6% | 43.3% | -17.1% |
| NewOcean Energy Holdings Ltd ($342) | 19.3% | 23.1% | 15.9% | 36.0% | |
| |
|---|
| Median (109 companies) | 23.9% | 10.0% | 5.9% | 3.1% | -2.6% |
|---|
| Century Ginwa Retail Holdings Ltd ($162) | | 34.0% | 7.5% | -8.0% | -9.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Culture Landmark Investment Ltd ($674) | 77.5% | 91.1% | 99.4% | 99.5% | |
| Modern Beauty Salon Holdings Ltd ($919) | 97.3% | 97.4% | 95.9% | 96.8% | 96.7% |
| Vongroup Ltd ($318) | | | | 95.1% | 99.1% |
| Nanjing Sinolife United Co Ltd ($3332) | 80.6% | 86.5% | 89.3% | 90.9% | |
| Embry Holdings Ltd ($1388) | 82.3% | 81.2% | 80.4% | 82.3% | |
| |
|---|
| Median (98 companies) | 39.4% | 37.2% | 36.4% | 35.1% | 45.3% |
|---|
| Century Ginwa Retail Holdings Ltd ($162) | 69.4% | 66.5% | 65.4% | 61.7% | 60.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Maoye International Holdings Ltd ($848) | 45.5% | 47.4% | 46.3% | 73.2% | |
| China Dongxiang Group Co Ltd ($3818) | 5.6% | 6.0% | 5.6% | 58.3% | |
| Nanjing Sinolife United Co Ltd ($3332) | 47.8% | 51.6% | 56.9% | 54.4% | |
| Lifestyle International Holdings Ltd ($1212) | 49.6% | 47.5% | 47.0% | 44.7% | 43.4% |
| Golden Eagle Retail Group Ltd ($3308) | 52.1% | 48.5% | 47.3% | 42.8% | |
| |
|---|
| Median (109 companies) | 13.1% | 9.6% | 7.1% | 7.9% | 7.1% |
|---|
| Century Ginwa Retail Holdings Ltd ($162) | 18.6% | 40.3% | 33.7% | 26.3% | 22.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Intime Retail Group Co Ltd ($1833) | 58.4% | 28.3% | 55.4% | 37.0% | |
| Future Bright Holdings Ltd ($703) | 6.2% | 2.6% | 3.7% | 36.8% | |
| Sage International Group Ltd ($8082) | 20.4% | 236.6% | 28.2% | 35.4% | |
| Maoye International Holdings Ltd ($848) | 30.9% | 32.8% | 24.1% | 31.5% | |
| Tsui Wah Holdings Ltd ($1314) | 5.2% | 8.3% | 9.3% | 30.5% | 10.6% |
| |
|---|
| Median (109 companies) | 3.8% | 4.0% | 3.6% | 3.4% | 2.5% |
|---|
| Century Ginwa Retail Holdings Ltd ($162) | 5.6% | 4.5% | 8.5% | 15.7% | 7.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Modern Beauty Salon Holdings Ltd ($919) | 48.1% | 50.7% | -4.6% | 81.3% | 71.8% |
| Starbucks Corp ($4337) | 36.4% | 36.4% | -6.0% | 52.8% | 51.4% |
| Sa Sa International Holdings Ltd ($178) | 45.7% | 53.5% | 52.7% | 49.0% | 39.8% |
| Coach Inc ($6388) | 82.0% | 82.3% | 68.7% | 45.0% | 20.8% |
| Nanjing Sinolife United Co Ltd ($3332) | 57.4% | 67.3% | 68.1% | 32.2% | |
| |
|---|
| Median (109 companies) | 17.2% | 12.0% | 8.2% | 8.4% | 5.3% |
|---|
| Century Ginwa Retail Holdings Ltd ($162) | 6.5% | 11.4% | 6.4% | 3.9% | 2.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sparkle Roll Group Ltd ($970) | -0.8x | 0.6x | 4.0x | 9.3x | 23.5x |
| China Yongda Automobiles Services Holdings Ltd ($3669) | 3.3x | 3.4x | 4.7x | 5.5x | |
| Zhongsheng Group Holdings Ltd ($881) | 2.2x | 4.6x | 4.5x | 5.3x | |
| NewOcean Energy Holdings Ltd ($342) | 35.2x | 6.2x | 6.1x | 5.3x | |
| China ZhengTong Auto Services Holdings Ltd ($1728) | 6.5x | 3.9x | 3.7x | 4.7x | |
| |
|---|
| Median (85 companies) | -0.8x | -0.6x | -0.9x | -0.3x | -0.6x |
|---|
| Century Ginwa Retail Holdings Ltd ($162) | 6.5x | 2.0x | 2.5x | 4.8x | 7.3x |
