Swire Properties Ltd reports 47.9% Net Income growth and 27.1 pp EBITDA Margin growth from 73.2% to 100%
10/03/2016 • About Swire Properties Ltd (
$1972) • By InTwits
Swire Properties 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: 100.3% in 2015, 73.2% in 2014, 114.6% in 2013, 154.5% in 2012, 283.7% in 2011
- Swire Properties Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 35.2%. At the same time it's a lot of higher than industry average of 3.3%.
- CAPEX is quite volatile: 4,504 in 2015, 2,754 in 2014, 1,936 in 2013, 1,039 in 2012, 303 in 2011
- The company has potentially unprofitable business model: ROIC is at 6.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Swire Properties Ltd ($1972) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 9,581 | 14,052 | 12,935 | 15,387 | 16,447 | 6.9% |
| Gross Profit | 7,247 | 10,282 | 9,404 | 10,211 | 10,666 | 4.5% |
| SG&A | 1,029 | 885 | 974 | 1,010 | 1,166 | 15.4% |
| EBITDA | 27,178 | 21,717 | 14,820 | 11,265 | 16,497 | 46.4% |
| Net Income | 25,126 | 18,753 | 12,525 | 9,516 | 14,072 | 47.9% |
Balance Sheet
|
|---|
| Cash | 1,180 | 1,940 | 2,521 | 2,874 | 4,358 | 51.6% |
| Short Term Debt | 8,855 | 5,014 | 8,354 | 4,851 | 7,881 | 62.5% |
| Long Term Debt | 20,250 | 26,197 | 26,946 | 32,744 | 30,474 | -6.9% |
Cash flow
|
|---|
| Capex | 5,265 | 3,004 | 5,458 | 4,951 | 4,174 | -15.7% |
Ratios
|
|---|
| Revenue growth | 8.0% | 46.7% | -7.9% | 19.0% | 6.9% | |
| EBITDA growth | -0.0% | -20.1% | -31.8% | -24.0% | 46.4% | |
| Gross Margin | 75.6% | 73.2% | 72.7% | 66.4% | 64.9% | -1.5% |
| EBITDA Margin | 283.7% | 154.5% | 114.6% | 73.2% | 100.3% | 27.1% |
| Net Income Margin | 262.2% | 133.5% | 96.8% | 61.8% | 85.6% | 23.7% |
| SG&A, % of revenue | 10.7% | 6.3% | 7.5% | 6.6% | 7.1% | 0.5% |
| CAPEX, % of revenue | 55.0% | 21.4% | 42.2% | 32.2% | 25.4% | -6.8% |
| ROIC | 13.1% | 9.8% | 6.1% | 4.4% | 6.3% | 1.9% |
| ROE | 15.0% | 10.2% | 6.3% | 4.6% | 6.6% | 2.0% |
| Net Debt/EBITDA | 1.0x | 1.3x | 2.2x | 3.1x | 2.1x | -1.0x |
Revenue and profitability
Swire Properties Ltd's Revenue increased on 6.9% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 11.3 pp from 42.3% to 53.6% in 2015.
Gross Margin decreased slightly on 1.5 pp from 66.4% to 64.9% in 2015. SG&A as a % of Revenue increased slightly on 0.53 pp from 6.6% to 7.1% in 2015.
Net Income marign surged on 23.7 pp from 61.8% to 85.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Swire Properties Ltd had CAPEX/Revenue of 25.4%. The company's CAPEX/Revenue increased on 4.0 pp from 21.4% in 2012 to 25.4% in 2015. Average CAPEX/Revenue for the last three years was 33.3%.
Return on investment
The company operates at low ROIC (6.28%) and ROE (6.64%). ROIC increased slightly on 1.9 pp from 4.4% to 6.3% in 2015. ROE increased slightly on 2.0 pp from 4.6% to 6.6% in 2015.
Leverage (Debt)
Debt level is 2.1x Net Debt / EBITDA and 2.3x Debt / EBITDA. Net Debt / EBITDA dropped on 1.0x from 3.1x to 2.1x in 2015. Debt increased on 2.0% in 2015 while cash surged on 51.6% in 2015.
Management team
Guy Martin Coutts Bradley is a Swire Properties Ltd's CEO. Guy Martin Coutts Bradley has spent 3 years at the company.
Appendix 1: Peers in Real Estate
Below you can find Swire Properties Ltd benchmarking vs. other companies in Real Estate 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 |
|---|
| 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 (173 companies) | 15.0% | 15.4% | 13.1% | 5.0% | 4.0% |
|---|
| Swire Properties Ltd ($1972) | | 46.7% | -7.9% | 19.0% | 6.9% |
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 (155 companies) | 43.6% | 41.9% | 40.5% | 39.1% | 48.3% |
|---|
| Swire Properties Ltd ($1972) | 75.6% | 73.2% | 72.7% | 66.4% | 64.9% |
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 (173 companies) | 35.1% | 28.9% | 28.0% | 26.4% | 34.2% |
|---|
| Swire Properties Ltd ($1972) | 283.7% | 154.5% | 114.6% | 73.2% | 100.3% |
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% | 0.9% |
| |
|---|
| Median (174 companies) | 5.8% | 5.4% | 6.1% | 4.6% | 7.2% |
|---|
| Swire Properties Ltd ($1972) | 55.0% | 21.4% | 42.2% | 32.2% | 25.4% |
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% |
| Colour Life Services Group Co Ltd ($1778) | | 44.2% | 47.9% | 29.3% | 14.5% |
| 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% | |
| |
|---|
| Median (177 companies) | 4.6% | 4.0% | 3.8% | 3.8% | 2.9% |
|---|
| Swire Properties Ltd ($1972) | 13.1% | 9.8% | 6.1% | 4.4% | 6.3% |
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 (140 companies) | 2.1x | 2.4x | 2.8x | 2.9x | 2.2x |
|---|
| Swire Properties Ltd ($1972) | 1.0x | 1.3x | 2.2x | 3.1x | 2.1x |
