Shun Ho Resources Holdings Ltd Net Income dropped on 75.2% in 2015 and EBITDA Margin decreased on 6.3 pp from 59.8% to 53.5%
11/03/2016 • About Shun Ho Resources Holdings Ltd (
$253) • By InTwits
Shun Ho Resources Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 53.5% in 2015 vs. 59.8% in 2014 vs. 64.6% in 2011
- Shun Ho Resources Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 24.4%. At the same time it's a lot of higher than industry average of 3.6%.
- CAPEX is quite volatile: 56.4 in 2015, 121 in 2014, 53.2 in 2013, 155 in 2012, 224 in 2011
- The company has potentially unprofitable business model: ROIC is at 3.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Shun Ho Resources Holdings Ltd ($253) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 401.6 | 520.5 | 688.7 | 648.4 | 561.8 | -13.4% |
| Gross Profit | 281.9 | 362.7 | 456.7 | 420.4 | 327.3 | -22.1% |
| SG&A | | | | 33.4 | 34.2 | 2.6% |
| EBITDA | 259.5 | 332.6 | 430.1 | 387.8 | 300.7 | -22.5% |
| Net Income | 173.5 | 197.3 | 229.7 | 344.8 | 85.4 | -75.2% |
Balance Sheet
|
|---|
| Cash | 100.7 | 180.7 | 316.1 | 1,166.2 | 1,065.4 | -8.6% |
| Short Term Debt | 1,170.9 | 1,135.6 | 730.5 | 678.3 | 606.2 | -10.6% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 224.1 | 155.5 | 53.2 | 121.3 | 56.4 | -53.5% |
Ratios
|
|---|
| Revenue growth | 31.9% | 29.6% | 32.3% | -5.9% | -13.4% | |
| EBITDA growth | 38.1% | 28.2% | 29.3% | -9.8% | -22.5% | |
| Gross Margin | 70.2% | 69.7% | 66.3% | 64.8% | 58.3% | -6.6% |
| EBITDA Margin | 64.6% | 63.9% | 62.5% | 59.8% | 53.5% | -6.3% |
| Net Income Margin | 43.2% | 37.9% | 33.3% | 53.2% | 15.2% | -38.0% |
| SG&A, % of revenue | | | | 5.1% | 6.1% | 0.9% |
| CAPEX, % of revenue | 55.8% | 29.9% | 7.7% | 18.7% | 10.0% | -8.7% |
| ROIC | 4.2% | 5.0% | 5.7% | 4.7% | 3.1% | -1.6% |
| ROE | 11.1% | 10.1% | 10.6% | 13.8% | 3.0% | -10.8% |
| Net Debt/EBITDA | 4.1x | 2.9x | 1.0x | -1.3x | -1.5x | -0.3x |
Revenue and profitability
Shun Ho Resources Holdings Ltd's Revenue dropped on 13.4% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 6.3 pp from 59.8% to 53.5% in 2015.
Gross Margin decreased on 6.6 pp from 64.8% to 58.3% in 2015. SG&A as a % of Revenue increased slightly on 0.94 pp from 5.1% to 6.1% in 2015.
Net Income marign dropped on 38.0 pp from 53.2% to 15.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Shun Ho Resources Holdings Ltd had CAPEX/Revenue of 10.0%. Shun Ho Resources Holdings Ltd's CAPEX/Revenue dropped on 19.8 pp from 29.9% in 2012 to 10.0% in 2015. It's average CAPEX/Revenue for the last three years was 12.2%.
Return on investment
The company operates at low ROIC (3.15%) and ROE (3.03%). ROIC decreased slightly on 1.6 pp from 4.7% to 3.1% in 2015. ROE dropped on 10.8 pp from 13.8% to 3.0% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.5x and Debt / EBITDA is 2.0x. Net Debt / EBITDA dropped on 0.3x from -1.3x to -1.5x in 2015. Debt dropped on 10.6% in 2015 while cash decreased on 8.6% in 2015.
Appendix 1: Peers in Real Estate
Below we provide Shun Ho Resources Holdings 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 (173 companies) | 13.8% | 15.4% | 13.0% | 5.2% | 4.2% |
|---|
| Shun Ho Resources Holdings Ltd ($253) | | 29.6% | 32.3% | -5.9% | -13.4% |
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% | 48.5% |
|---|
| Shun Ho Resources Holdings Ltd ($253) | 70.2% | 69.7% | 66.3% | 64.8% | 58.3% |
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% | 34.3% |
|---|
| Shun Ho Resources Holdings Ltd ($253) | 64.6% | 63.9% | 62.5% | 59.8% | 53.5% |
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% | 6.8% |
|---|
| Shun Ho Resources Holdings Ltd ($253) | 55.8% | 29.9% | 7.7% | 18.7% | 10.0% |
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% | 3.0% |
|---|
| Shun Ho Resources Holdings Ltd ($253) | 4.2% | 5.0% | 5.7% | 4.7% | 3.1% |
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 | 2.2x | 2.8x | 3.0x | 2.2x |
|---|
| Shun Ho Resources Holdings Ltd ($253) | 4.1x | 2.9x | 1.0x | -1.3x | -1.5x |
