Sinopec Shanghai Petrochemical Co Ltd reports 221% EBITDA growth while 27.6% Revenue decline
16/03/2016 • About Sinopec Shanghai Petrochemical Co Ltd (
$338) • By InTwits
Sinopec Shanghai Petrochemical Co 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: 8.2% in 2015, 1.8% in 2014, 4.4% in 2013, -0.1% in 2012, 3.0% in 2011
- Sinopec Shanghai Petrochemical Co Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.4%. At the same time it's a lot of higher than industry average of 5.5%.
- CAPEX is quite volatile: 695 in 2015, 1,089 in 2014, 1,323 in 2013, 4,260 in 2012, 3,481 in 2011
- The company has highly profitable business model: ROIC is at 16.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sinopec Shanghai Petrochemical Co Ltd ($338) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 89,592 | 87,217 | 105,503 | 92,725 | 67,092 | -27.6% |
| Gross Profit | 4,550 | -1,401 | 2,277 | -185 | 7,003 | -3,883.5% |
| SG&A | 3,142 | 650 | 691 | 564 | 2,998 | 431.4% |
| EBITDA | 2,692 | -84 | 4,664 | 1,708 | 5,478 | 220.8% |
| Net Income | 944 | -1,528 | 2,055 | -692 | 3,246 | -568.9% |
Balance Sheet
|
|---|
| Cash | 91 | 161 | 133 | 279 | 1,077 | 285.9% |
| Short Term Debt | 5,528 | 11,024 | 7,094 | 4,078 | 2,070 | -49.2% |
| Long Term Debt | 160 | 1,231 | 628 | 1,633 | 0 | -100.0% |
Cash flow
|
|---|
| Capex | 3,481 | 4,260 | 1,323 | 1,089 | 695 | -36.2% |
Ratios
|
|---|
| Revenue growth | 24.3% | -2.7% | 21.0% | -12.1% | -27.6% | |
| EBITDA growth | -41.8% | -103.1% | -5,629.3% | -63.4% | 220.8% | |
| Gross Margin | 5.1% | -1.6% | 2.2% | -0.2% | 10.4% | 10.6% |
| EBITDA Margin | 3.0% | -0.1% | 4.4% | 1.8% | 8.2% | 6.3% |
| Net Income Margin | 1.1% | -1.8% | 1.9% | -0.7% | 4.8% | 5.6% |
| SG&A, % of revenue | 3.5% | 0.7% | 0.7% | 0.6% | 4.5% | 3.9% |
| CAPEX, % of revenue | 3.9% | 4.9% | 1.3% | 1.2% | 1.0% | -0.1% |
| ROIC | 4.5% | -6.9% | 8.1% | -2.4% | 16.5% | 18.9% |
| ROE | 5.3% | -9.0% | 12.2% | -4.0% | 17.9% | 21.9% |
| Net Debt/EBITDA | 2.1x | | 1.6x | 3.2x | 0.2x | -3.0x |
Revenue and profitability
The company's Revenue dropped on 27.6% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 6.3 pp from 1.8% to 8.2% in 2015.
Gross Margin jumped on 10.6 pp from -0.20% to 10.4% in 2015. SG&A as a % of Revenue increased on 3.9 pp from 0.61% to 4.5% in 2015.
Net Income marign increased on 5.6 pp from -0.75% to 4.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 1.0%. Sinopec Shanghai Petrochemical Co Ltd's CAPEX/Revenue decreased on 3.8 pp from 4.9% in 2012 to 1.0% in 2015. It's average level of CAPEX/Revenue for the last three years was 1.2%.
Return on investment
The company operates at good ROIC (16.52%) and ROE (17.86%). ROIC jumped on 18.9 pp from -2.4% to 16.5% in 2015. ROE surged on 21.9 pp from -4.0% to 17.9% in 2015.
Leverage (Debt)
Debt level is 0.2x Net Debt / EBITDA and 0.4x Debt / EBITDA. Net Debt / EBITDA dropped on 3.0x from 3.2x to 0.2x in 2015. Debt dropped on 63.8% in 2015 while cash jumped on 286% in 2015.
Appendix 1: Peers in Chemicals
Below you can find Sinopec Shanghai Petrochemical Co Ltd benchmarking vs. other companies in Chemicals 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 |
|---|
| Bestway International Holdings Ltd ($718) | | -25.4% | -62.1% | 330.3% | 238.4% |
| Jilin Qifeng Chemical Fiber Co Ltd ($549) | 39.7% | -33.6% | 5.5% | 29.1% | |
| China XLX Fertiliser Ltd ($1866) | | 7.0% | 0.6% | 28.0% | 13.9% |
| Century Sunshine Group Holdings Ltd ($509) | 49.2% | 68.7% | 32.0% | 26.4% | |
| Landing International Development Ltd ($582) | -50.7% | 2.1% | 15.9% | 23.3% | |
| |
|---|
| Median (31 companies) | 34.7% | 2.1% | 9.4% | 2.2% | -0.6% |
|---|
| Sinopec Shanghai Petrochemical Co Ltd ($338) | | -2.7% | 21.0% | -12.1% | -27.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 74.3% | 70.5% | 69.1% | 70.8% | 69.9% |
| China Flavors & Fragrances Co Ltd ($3318) | 41.3% | 46.8% | 48.6% | 47.8% | 48.9% |
| Smartac Group China Holdings Ltd ($395) | 17.3% | -1.8% | 11.2% | 40.4% | |
| Bracell Ltd ($1768) | 40.1% | 30.5% | 37.3% | 37.3% | 38.4% |
| Yingde Gases Group Co Ltd ($2168) | 34.2% | 31.7% | 31.0% | 32.1% | |
| |
|---|
| Median (31 companies) | 19.8% | 19.5% | 18.5% | 17.7% | 28.2% |
|---|
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 5.1% | -1.6% | 2.2% | -0.2% | 10.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 66.4% | 63.8% | 59.1% | 60.0% | 58.3% |
| Bracell Ltd ($1768) | 30.1% | 22.3% | 30.8% | 38.2% | 35.9% |
| Yingde Gases Group Co Ltd ($2168) | 32.3% | 29.4% | 29.8% | 32.3% | |
| China First Chemical Holdings Ltd ($2121) | 29.7% | 26.6% | 30.0% | 29.6% | |
| Century Sunshine Group Holdings Ltd ($509) | 15.5% | 24.2% | 28.1% | 27.6% | |
| |
|---|
| Median (31 companies) | 15.5% | 15.8% | 14.5% | 13.8% | 15.4% |
|---|
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 3.0% | -0.1% | 4.4% | 1.8% | 8.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Landing International Development Ltd ($582) | 27.9% | 7.2% | 29.6% | 419.5% | |
| China Zenith Chemical Group Ltd ($362) | 36.8% | 147.3% | 55.7% | 67.4% | 152.2% |
| Smartac Group China Holdings Ltd ($395) | 22.5% | 14.0% | 4.7% | 49.3% | |
| China Flavors & Fragrances Co Ltd ($3318) | 16.4% | 15.8% | 20.1% | 42.4% | 35.8% |
| Bracell Ltd ($1768) | 24.4% | 22.3% | 64.3% | 35.4% | 11.7% |
| |
|---|
| Median (31 companies) | 8.7% | 9.6% | 8.7% | 5.9% | 8.1% |
|---|
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 3.9% | 4.9% | 1.3% | 1.2% | 1.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 34.6% | 28.7% | 25.2% | 26.2% | 23.3% |
| Tiande Chemical Holdings Ltd ($609) | 24.4% | 26.2% | 29.4% | 20.7% | 20.6% |
| Century Sunshine Group Holdings Ltd ($509) | 3.5% | 11.3% | 15.9% | 16.4% | |
| Fufeng Group Ltd ($546) | 13.9% | 9.6% | 10.8% | 11.6% | 10.3% |
| Yingde Gases Group Co Ltd ($2168) | 14.7% | 10.6% | 11.5% | 11.5% | |
| |
|---|
| Median (31 companies) | 8.2% | 6.9% | 7.4% | 5.9% | 6.6% |
|---|
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 4.5% | -6.9% | 8.1% | -2.4% | 16.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Sanjiang Fine Chemicals Co Ltd ($2198) | 2.4x | 2.2x | 4.6x | 18.1x | |
| China XLX Fertiliser Ltd ($1866) | 2.4x | 2.6x | 5.1x | 5.8x | 5.1x |
| Ngai Hing Hong Co Ltd ($1047) | 4.8x | 11.7x | 5.3x | 5.4x | 5.3x |
| Jilin Qifeng Chemical Fiber Co Ltd ($549) | 4.3x | 14.1x | 6.5x | 5.3x | |
| Sinofert Holdings Ltd ($297) | 4.3x | 2.9x | 32.4x | 5.0x | |
| |
|---|
| Median (24 companies) | 1.3x | 1.6x | 2.5x | 1.4x | 0.3x |
|---|
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 2.1x | | 1.6x | 3.2x | 0.2x |
