China Vanke Co Ltd reports 28.7% revenue growth in 2015 and 3.7 pp EBITDA Margin decline from 21.1% to 17.3%
13/03/2016 • About China Vanke Co Ltd (
$2202) • By InTwits
China Vanke Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Vanke Co Ltd is a fast growth stock: 2015 revenue growth was 28.7%, 5 year revenue CAGR was 31.5% at 2015 ROIC 14.1%
- China Vanke Co Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.0%.
- The company has highly profitable business model: ROIC is at 14.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Vanke Co Ltd ($2202) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 67,709 | 96,860 | 123,874 | 137,994 | 177,569 | 28.7% |
| Gross Profit | 24,460 | 31,406 | 31,076 | 34,635 | 39,418 | 13.8% |
| SG&A | 5,223 | 5,902 | 6,868 | 8,508 | 8,884 | 4.4% |
| EBITDA | 19,386 | 25,662 | 24,327 | 29,048 | 30,754 | 5.9% |
| Net Income | 9,625 | 12,551 | 15,119 | 15,746 | 18,119 | 15.1% |
Balance Sheet
|
|---|
| Cash | 33,614 | 51,120 | 43,004 | 61,653 | 51,748 | -16.1% |
| Short Term Debt | 23,570 | 35,557 | 47,408 | 22,832 | 43,391 | 90.0% |
| Long Term Debt | 26,822 | 36,036 | 44,082 | 46,149 | 52,844 | 14.5% |
Cash flow
|
|---|
| Capex | 262 | 151 | 2,439 | 1,831 | 2,063 | 12.7% |
Ratios
|
|---|
| Revenue growth | 50.2% | 43.1% | 27.9% | 11.4% | 28.7% | |
| EBITDA growth | 65.2% | 32.4% | -5.2% | 19.4% | 5.9% | |
| Gross Margin | 36.1% | 32.4% | 25.1% | 25.1% | 22.2% | -2.9% |
| EBITDA Margin | 28.6% | 26.5% | 19.6% | 21.1% | 17.3% | -3.7% |
| Net Income Margin | 14.2% | 13.0% | 12.2% | 11.4% | 10.2% | -1.2% |
| SG&A, % of revenue | 7.7% | 6.1% | 5.5% | 6.2% | 5.0% | -1.2% |
| CAPEX, % of revenue | 0.4% | 0.2% | 2.0% | 1.3% | 1.2% | -0.2% |
| ROIC | 16.8% | 17.8% | 13.5% | 14.6% | 14.1% | -0.5% |
| ROE | 19.8% | 21.5% | 21.5% | 19.1% | 19.2% | 0.2% |
| Net Debt/EBITDA | 0.9x | 0.8x | 2.0x | 0.3x | 1.4x | 1.2x |
Revenue and profitability
The company's Revenue surged on 28.7% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.1 pp from 15.2% to 16.3% in 2015.
Gross Margin decreased on 2.9 pp from 25.1% to 22.2% in 2015. SG&A as a % of Revenue decreased slightly on 1.2 pp from 6.2% to 5.0% in 2015.
Net Income marign decreased slightly on 1.2 pp from 11.4% to 10.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 1.2% in 2015. CAPEX/Revenue increased slightly on 1.0 pp from 0.16% in 2012 to 1.2% in 2015. It's average CAPEX/Revenue for the last three years was 1.5%.
Return on investment
The company operates at good ROIC (14.10%) and ROE (19.24%). ROIC decreased slightly on 0.54 pp from 14.6% to 14.1% in 2015. ROE showed almost no change in 2015.
Leverage (Debt)
Debt level is 1.4x Net Debt / EBITDA and 3.1x Debt / EBITDA. Net Debt / EBITDA jumped on 1.2x from 0.3x to 1.4x in 2015. Debt surged on 39.5% in 2015 while cash dropped on 16.1% in 2015.
Appendix 1: Peers in Real Estate
Below you can find China Vanke Co 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) | 12.6% | 15.4% | 13.0% | 5.0% | 4.0% |
|---|
| China Vanke Co Ltd ($2202) | | 43.1% | 27.9% | 11.4% | 28.7% |
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) | 43.8% | 42.2% | 41.8% | 39.3% | 48.6% |
|---|
| China Vanke Co Ltd ($2202) | 36.1% | 32.4% | 25.1% | 25.1% | 22.2% |
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) | 35.3% | 29.1% | 28.2% | 27.3% | 34.5% |
|---|
| China Vanke Co Ltd ($2202) | 28.6% | 26.5% | 19.6% | 21.1% | 17.3% |
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) | 5.9% | 5.5% | 6.2% | 4.7% | 7.2% |
|---|
| China Vanke Co Ltd ($2202) | 0.4% | 0.2% | 2.0% | 1.3% | 1.2% |
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% |
|---|
| China Vanke Co Ltd ($2202) | 16.8% | 17.8% | 13.5% | 14.6% | 14.1% |
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 | 2.4x | 2.8x | 3.0x | 2.1x |
|---|
| China Vanke Co Ltd ($2202) | 0.9x | 0.8x | 2.0x | 0.3x | 1.4x |
