Orient Overseas International Ltd revenue decreased on 8.7% in 2015 while EBITDA Margin increased slightly on 1.2 pp from 9.1% to 10.3%
07/03/2016 • About Orient Overseas International Ltd (
$316) • By InTwits
Orient Overseas International Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Orient Overseas International Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.9%. At the same time it's a lot of higher than industry average of 6.2%.
- CAPEX is quite volatile: 174 in 2015, 142 in 2014, 39.9 in 2013, 13.1 in 2012, 14.8 in 2011
- The company has potentially unprofitable business model: ROIC is at 3.3%
- It operates with high leverage: Net Debt/EBITDA is 3.9x while industry average is 2.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Orient Overseas International Ltd ($316) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 6,012 | 6,459 | 6,232 | 6,522 | 5,953 | -8.7% |
| Gross Profit | 528 | 652 | 460 | 646 | 691 | 7.0% |
| SG&A | 402 | 441 | 415 | 432 | 442 | 2.2% |
| EBITDA | 375 | 479 | 352 | 592 | 613 | 3.5% |
| Net Income | 182 | 295 | 47 | 271 | 284 | 4.9% |
Balance Sheet
|
|---|
| Cash | 1,909 | 1,597 | 1,720 | 1,943 | 1,738 | -10.6% |
| Short Term Debt | 439 | 556 | 268 | 389 | 439 | 12.8% |
| Long Term Debt | 2,233 | 2,326 | 3,266 | 3,596 | 3,663 | 1.9% |
Cash flow
|
|---|
| Capex | 738 | 732 | 574 | 361 | 366 | 1.5% |
Ratios
|
|---|
| Revenue growth | -0.4% | 7.4% | -3.5% | 4.7% | -8.7% | |
| EBITDA growth | -67.6% | 27.5% | -26.4% | 68.1% | 3.5% | |
| Gross Margin | 8.8% | 10.1% | 7.4% | 9.9% | 11.6% | 1.7% |
| EBITDA Margin | 6.2% | 7.4% | 5.7% | 9.1% | 10.3% | 1.2% |
| Net Income Margin | 3.0% | 4.6% | 0.8% | 4.1% | 4.8% | 0.6% |
| SG&A, % of revenue | 6.7% | 6.8% | 6.7% | 6.6% | 7.4% | 0.8% |
| CAPEX, % of revenue | 12.3% | 11.3% | 9.2% | 5.5% | 6.2% | 0.6% |
| ROIC | 1.6% | 3.2% | 0.5% | 3.1% | 3.3% | 0.2% |
| ROE | 3.7% | 6.8% | 1.1% | 5.9% | 6.0% | 0.1% |
| Net Debt/EBITDA | 2.0x | 2.7x | 5.1x | 3.4x | 3.9x | 0.4x |
Revenue and profitability
Orient Overseas International Ltd's Revenue decreased on 8.7% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 1.2 pp from 9.1% to 10.3% in 2015.
Gross Margin increased slightly on 1.7 pp from 9.9% to 11.6% in 2015. SG&A as a % of Revenue increased slightly on 0.79 pp from 6.6% to 7.4% in 2015.
Net Income marign increased slightly on 0.62 pp from 4.1% to 4.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
Orient Overseas International Ltd's CAPEX/Revenue was 6.2% in 2015. Orient Overseas International Ltd showed decline in CAPEX/Revenue of 5.2 pp from 11.3% in 2012 to 6.2% in 2015. It's average level of CAPEX/Revenue for the last three years was 7.0%.Battling declining revenue the company invested a large share of EBITDA (59.7%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at low ROIC (3.32%) and ROE (6.02%). ROIC showed almost no change in 2015. ROE showed almost no change in 2015.
Leverage (Debt)
Debt level is 3.9x Net Debt / EBITDA and 6.7x Debt / EBITDA. Net Debt / EBITDA surged on 0.4x from 3.4x to 3.9x in 2015. Debt increased on 2.9% in 2015 while cash dropped on 10.6% in 2015.
Management team
The company's CEO Tung Chee Chen has spent 22 years at the company. Orient Overseas International Ltd's CFO is Tung Lieh Sing "Alan". Tung Lieh Sing "Alan" has 5 years tenure at the company.
Appendix 1: Peers in Transportation
Below you can find Orient Overseas International Ltd benchmarking vs. other companies in Transportation 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 |
|---|
| Frontier Services Group Ltd ($500) | -90.5% | -10.8% | -49.9% | 1,021.1% | |
| China Best Group Holding Ltd ($370) | 333.1% | 202.4% | -53.6% | 459.4% | |
| Guangdong Yueyun Transportation Co Ltd-H ($3399) | 11.7% | -4.2% | -5.9% | 60.4% | |
| Tianjin Port Development Holdings Ltd ($3382) | 9.8% | 8.7% | 24.9% | 51.9% | |
| CIG Yangtze Ports PLC ($8233) | 71.2% | 17.9% | 30.6% | 23.5% | |
| |
|---|
| Median (28 companies) | 10.7% | 5.1% | 4.6% | 5.6% | -5.7% |
|---|
| Orient Overseas International Ltd ($316) | | 7.4% | -3.5% | 4.7% | -8.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CIG Yangtze Ports PLC ($8233) | 51.0% | 51.3% | 44.8% | 46.6% | |
| Frontier Services Group Ltd ($500) | 80.7% | 83.8% | 65.9% | 44.8% | |
| Qinhuangdao Port Co Ltd ($3369) | 43.2% | 43.1% | 42.4% | 43.3% | |
| Chu Kong Shipping Enterprise Group Co Ltd ($560) | 21.5% | 23.1% | 25.1% | 24.1% | |
| Kwoon Chung Bus Holdings Ltd ($306) | 17.6% | 18.9% | 20.4% | 22.7% | 26.8% |
| |
|---|
| Median (25 companies) | 18.7% | 13.0% | 10.9% | 10.3% | -0.3% |
|---|
| Orient Overseas International Ltd ($316) | 8.8% | 10.1% | 7.4% | 9.9% | 11.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Qinhuangdao Port Co Ltd ($3369) | 45.3% | 46.0% | 44.6% | 46.5% | |
| MTR Corp Ltd ($66) | 49.1% | 42.7% | 37.6% | 45.2% | |
| CIG Yangtze Ports PLC ($8233) | 29.9% | 30.2% | 27.6% | 38.5% | |
| Great Harvest Maeta Group Holdings Ltd ($3683) | 61.3% | 56.3% | 18.7% | 32.6% | -8.5% |
| China Shipping Development Co Ltd ($1138) | 24.7% | 12.5% | 3.0% | 24.7% | |
| |
|---|
| Median (29 companies) | 16.5% | 10.0% | 8.2% | 7.8% | -1.2% |
|---|
| Orient Overseas International Ltd ($316) | 6.2% | 7.4% | 5.7% | 9.1% | 10.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Noble Century Investment Holdings Ltd ($2322) | | 0.0% | | 296.6% | 1.4% |
| Frontier Services Group Ltd ($500) | 5.4% | 6.3% | 3.6% | 63.3% | |
| China Shipping Development Co Ltd ($1138) | 68.9% | 55.8% | 34.0% | 54.9% | |
| Courage Marine Group Ltd ($1145) | 78.9% | 235.0% | 37.7% | 50.4% | 9.2% |
| Qinhuangdao Port Co Ltd ($3369) | 47.2% | 57.9% | 35.8% | 46.3% | |
| |
|---|
| Median (29 companies) | 11.1% | 7.9% | 10.2% | 7.4% | 9.2% |
|---|
| Orient Overseas International Ltd ($316) | 12.3% | 11.3% | 9.2% | 5.5% | 6.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Changan Minsheng APLL Logistics Co Ltd ($1292) | 34.2% | 21.1% | 20.9% | 19.1% | |
| ASR Logistics Holdings Ltd ($1803) | 79.6% | 54.7% | 38.9% | 13.4% | |
| CIG Yangtze Ports PLC ($8233) | 4.3% | 4.9% | 5.7% | 11.0% | |
| Kerry Logistics Network Ltd ($636) | 11.3% | 12.0% | 13.4% | 10.5% | |
| Guangdong Yueyun Transportation Co Ltd-H ($3399) | 8.9% | 5.6% | 7.2% | 9.6% | |
| |
|---|
| Median (29 companies) | 5.3% | 3.2% | 2.8% | 3.7% | -4.5% |
|---|
| Orient Overseas International Ltd ($316) | 1.6% | 3.2% | 0.5% | 3.1% | 3.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jinhui Holdings Co Ltd ($137) | 2.8x | 5.0x | 4.2x | 17.5x | |
| China Shipping Development Co Ltd ($1138) | 7.2x | 20.2x | 92.8x | 12.8x | |
| Tianjin Binhai Teda Logistics Group Corp Ltd ($8348) | -0.5x | 9.7x | 9.3x | 9.5x | |
| China COSCO Holdings Co Ltd ($1919) | | | 18.8x | 9.0x | |
| AMS Public Transport Holdings Ltd ($77) | 0.7x | 1.2x | 11.6x | 7.7x | 4.5x |
| |
|---|
| Median (22 companies) | -0.0x | 1.2x | 1.5x | 0.8x | 4.5x |
|---|
| Orient Overseas International Ltd ($316) | 2.0x | 2.7x | 5.1x | 3.4x | 3.9x |
