Zhejiang Yonglong Enterprises Co Ltd reports 18.9% EBITDA decline and 2.5 pp EBITDA Margin decline from 12.4% to 9.9%
10/03/2016 • About Zhejiang Yonglong Enterprises Co Ltd (
$8211) • By InTwits
Zhejiang Yonglong Enterprises 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: 9.9% in 2015 vs. 12.4% in 2014 vs. 203.0% in 2011
- EBITDA Margin is quite volatile: 9.9% in 2015, 12.4% in 2014, 14.0% in 2013, 19.9% in 2012, 203.0% in 2011
- Zhejiang Yonglong Enterprises Co Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.9%.
- The company has potentially unprofitable business model: ROIC is at 3.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Zhejiang Yonglong Enterprises Co Ltd ($8211) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 195.4 | 130.0 | 206.4 | 188.6 | 192.0 | 1.8% |
| Gross Profit | 14.2 | 15.2 | 26.1 | 22.6 | 23.0 | 1.5% |
| SG&A | | 14.1 | 10.7 | 11.1 | 13.5 | 21.7% |
| EBITDA | 396.8 | 25.9 | 28.8 | 23.5 | 19.0 | -18.9% |
| Net Income | 397.6 | -17.6 | 43.7 | -7.3 | -17.2 | 134.9% |
Balance Sheet
|
|---|
| Cash | 31.3 | 43.3 | 168.9 | 127.9 | 195.3 | 52.7% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 127.9 | 151.3 | 172.9 | 197.5 | 219.9 | 11.3% |
Cash flow
|
|---|
| Capex | 6.0 | 1.1 | 0.4 | 0.5 | 0.3 | -48.0% |
Ratios
|
|---|
| Revenue growth | 128.1% | -33.5% | 58.8% | -8.6% | 1.8% | |
| EBITDA growth | -1,844.2% | -93.5% | 11.2% | -18.6% | -18.9% | |
| Gross Margin | 7.3% | 11.7% | 12.6% | 12.0% | 12.0% | -0.0% |
| EBITDA Margin | 203.0% | 19.9% | 14.0% | 12.4% | 9.9% | -2.5% |
| Net Income Margin | 203.4% | -13.6% | 21.2% | -3.9% | -8.9% | -5.1% |
| SG&A, % of revenue | | 10.8% | 5.2% | 5.9% | 7.0% | 1.2% |
| CAPEX, % of revenue | 3.1% | 0.9% | 0.2% | 0.3% | 0.1% | -0.1% |
| ROIC | 196.6% | 2.4% | 7.5% | 5.0% | 3.5% | -1.5% |
| ROE | | -25.3% | 51.2% | -6.9% | -17.3% | -10.4% |
| Net Debt/EBITDA | 0.2x | 4.2x | 0.1x | 3.0x | 1.3x | -1.7x |
Revenue and profitability
Zhejiang Yonglong Enterprises Co Ltd's Revenue increased slightly on 1.8% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 6.7 pp from 13.2% to 6.5% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue increased slightly on 1.2 pp from 5.9% to 7.0% in 2015.
Net Income marign decreased on 5.1 pp from -3.9% to -8.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.13% in 2015. CAPEX/Revenue decreased slightly on 0.72 pp from 0.85% in 2012 to 0.13% in 2015. It's average level of CAPEX/Revenue for the last three years was 0.20%.
Return on investment
The company operates at low but positive ROIC (3.52%) and negative ROE (-17.29%). ROIC decreased slightly on 1.5 pp from 5.0% to 3.5% in 2015. ROE dropped on 10.4 pp from -6.9% to -17.3% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.3x and Debt / EBITDA is 11.6x. Net Debt / EBITDA dropped on 1.7x from 3.0x to 1.3x in 2015. Debt jumped on 11.3% in 2015 while cash surged on 52.7% in 2015.
Appendix 1: Peers in Textiles
Below you can find Zhejiang Yonglong Enterprises Co Ltd benchmarking vs. other companies in Textiles 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 |
|---|
| Victory City International Holdings Ltd ($539) | | -5.2% | 6.5% | 31.5% | -4.4% |
| Guangdong Tannery Ltd ($1058) | 12.7% | 6.1% | -4.5% | 29.0% | |
| Kingdom Holding Co Ltd ($528) | 13.1% | 1.1% | 6.0% | 20.0% | |
| Pacific Textiles Holdings Ltd ($1382) | | -10.6% | 3.6% | 11.6% | -7.0% |
| Kam Hing International Holdings Ltd ($2307) | 24.4% | 0.9% | -4.3% | 1.6% | |
| |
|---|
| Median (19 companies) | 17.3% | 0.1% | -4.3% | -11.5% | -5.4% |
|---|
| Zhejiang Yonglong Enterprises Co Ltd ($8211) | | -33.5% | 58.8% | -8.6% | 1.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| TAI Ping Carpet International Ltd ($146) | 40.4% | 41.0% | 45.4% | 46.7% | |
| Ping Shan Tea Group Ltd ($364) | 15.3% | 11.2% | 20.8% | 42.9% | |
| Texwinca Holdings Ltd ($321) | 33.7% | 29.6% | 30.9% | 33.3% | 34.1% |
| CECEP COSTIN New Materials Group Ltd ($2228) | 30.3% | 31.1% | 32.5% | 32.5% | |
| Kingdom Holding Co Ltd ($528) | 32.1% | 29.1% | 27.2% | 26.8% | |
| |
|---|
| Median (19 companies) | 18.0% | 17.1% | 16.6% | 14.4% | 18.6% |
|---|
| Zhejiang Yonglong Enterprises Co Ltd ($8211) | 7.3% | 11.7% | 12.6% | 12.0% | 12.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ping Shan Tea Group Ltd ($364) | 14.9% | 11.2% | | 39.3% | |
| CECEP COSTIN New Materials Group Ltd ($2228) | 26.2% | 28.1% | 28.7% | 30.2% | |
| Kingdom Holding Co Ltd ($528) | 29.3% | 26.3% | 25.3% | 24.8% | |
| Weiqiao Textile Co ($2698) | 10.2% | 17.5% | 20.2% | 21.4% | |
| Pacific Textiles Holdings Ltd ($1382) | 19.5% | 19.1% | 19.0% | 19.5% | 18.4% |
| |
|---|
| Median (19 companies) | 13.3% | 9.4% | 8.8% | 11.7% | 10.2% |
|---|
| Zhejiang Yonglong Enterprises Co Ltd ($8211) | 203.0% | 19.9% | 14.0% | 12.4% | 9.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hua Lien International Holding Co Ltd ($969) | 0.0% | 19.7% | 40.5% | 79.6% | |
| Ping Shan Tea Group Ltd ($364) | 18.1% | 32.0% | | 14.0% | |
| Kingdom Holding Co Ltd ($528) | 6.2% | 8.4% | 18.8% | 10.9% | |
| Victory City International Holdings Ltd ($539) | 2.3% | 4.2% | 10.1% | 8.6% | 6.8% |
| Silverman Holdings Ltd ($1616) | 8.7% | 6.5% | 18.0% | 8.4% | |
| |
|---|
| Median (19 companies) | 2.6% | 4.2% | 2.1% | 5.6% | 6.1% |
|---|
| Zhejiang Yonglong Enterprises Co Ltd ($8211) | 3.1% | 0.9% | 0.2% | 0.3% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pacific Textiles Holdings Ltd ($1382) | 28.8% | 23.7% | 26.4% | 31.6% | 25.9% |
| CECEP COSTIN New Materials Group Ltd ($2228) | 24.2% | 22.3% | 20.1% | 17.6% | |
| Yongsheng Advanced Materials Co Ltd ($3608) | 7.9% | 6.2% | 13.2% | 15.4% | |
| Kingdom Holding Co Ltd ($528) | 16.3% | 13.8% | 12.7% | 13.8% | |
| TAI Ping Carpet International Ltd ($146) | | | 2.6% | 5.7% | |
| |
|---|
| Median (19 companies) | 7.3% | 5.2% | 3.8% | 3.5% | 5.0% |
|---|
| Zhejiang Yonglong Enterprises Co Ltd ($8211) | 196.6% | 2.4% | 7.5% | 5.0% | 3.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Guangdong Tannery Ltd ($1058) | 8.9x | 6.5x | 5.8x | 11.6x | |
| Sijia Group Co ($1863) | -0.1x | 1.6x | 5.3x | 6.4x | |
| China Weaving Materials Holdings Ltd ($3778) | 1.3x | 3.6x | 3.0x | 5.3x | |
| Co-Prosperity Holdings Ltd ($707) | 8.3x | 34.8x | | 4.5x | |
| Victory City International Holdings Ltd ($539) | 1.8x | 1.5x | 2.0x | 3.2x | 2.5x |
| |
|---|
| Median (17 companies) | 1.3x | 1.5x | 2.0x | 0.7x | 0.5x |
|---|
| Zhejiang Yonglong Enterprises Co Ltd ($8211) | 0.2x | 4.2x | 0.1x | 3.0x | 1.3x |
