Hailiang International Holdings Ltd reports 99.7% revenue growth in 2015 and 3.2 pp EBITDA Margin growth from -17.2% to -14.0%
18/03/2016 • About Hailiang International Holdings Ltd (
$2336) • By InTwits
Hailiang International Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Hailiang International Holdings Ltd doesn't have a profitable business model yet: 2015 ROIC is -6.9%
- The company operates at negative EBITDA Margin: -14.0%
- Hailiang International Holdings Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 was 0.0%. On average EBITDA Margin was -1.2% for the sames years0
- Hailiang International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.7%.
- The company has unprofitable business model: ROIC is at -6.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Hailiang International Holdings Ltd ($2336) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 304.7 | 334.1 | 231.2 | 71.4 | 142.6 | 99.7% |
| Gross Profit | 26.7 | 24.3 | 8.4 | 2.9 | 2.8 | -0.9% |
| SG&A | | 16.2 | 12.3 | 15.3 | 23.6 | 54.2% |
| EBITDA | 13.6 | 9.2 | -3.9 | -12.2 | -19.9 | 62.8% |
| Net Income | -16.0 | 263.1 | 0.4 | -11.4 | -16.4 | 43.3% |
Balance Sheet
|
|---|
| Cash | 10.4 | 81.9 | 121.2 | 131.4 | 208.3 | 58.5% |
| Short Term Debt | 28.0 | 0.0 | 0.0 | 0.0 | 0.1 | |
| Long Term Debt | 0.0 | 7.2 | 0.0 | 0.0 | 0.2 | |
Cash flow
|
|---|
| Capex | 0.8 | 2.2 | 1.0 | 1.3 | 0.6 | -50.8% |
Ratios
|
|---|
| Revenue growth | 70.7% | 9.7% | -30.8% | -69.1% | 99.7% | |
| EBITDA growth | 152.2% | -32.2% | -141.8% | 216.9% | 62.8% | |
| Gross Margin | 8.8% | 7.3% | 3.6% | 4.0% | 2.0% | -2.0% |
| EBITDA Margin | 4.5% | 2.8% | -1.7% | -17.2% | -14.0% | 3.2% |
| Net Income Margin | -5.2% | 78.8% | 0.2% | -16.0% | -11.5% | 4.5% |
| SG&A, % of revenue | | 4.9% | 5.3% | 21.4% | 16.5% | -4.9% |
| CAPEX, % of revenue | 0.3% | 0.7% | 0.4% | 1.8% | 0.4% | -1.4% |
| ROIC | | | -2.8% | -8.0% | -6.9% | 1.1% |
| ROE | | | 0.2% | -7.6% | -5.6% | 2.0% |
| Net Debt/EBITDA | 1.3x | -8.1x | | | | 0.0x |
Revenue and profitability
The company's Revenue surged on 99.7% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.61 pp from 14.4% to 15.0% in 2015.
Gross Margin decreased on 2.0 pp from 4.0% to 2.0% in 2015. SG&A as a % of Revenue decreased on 4.9 pp from 21.4% to 16.5% in 2015.
Net Income marign increased on 4.5 pp from -16.0% to -11.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.45% in 2015. CAPEX/Revenue showed almost no change from 2012 to 2015. It's average CAPEX/Revenue for the last three years was 0.90%.
Return on investment
The company operates at negative ROIC (-6.92%) and ROE (-5.56%). ROIC increased slightly on 1.1 pp from -8.0% to -6.9% in 2015. ROE increased on 2.0 pp from -7.6% to -5.6% in 2015.
Leverage (Debt)
Debt level is -0.0x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2015. Debt jumped while cash surged on 58.5% in 2015.
Appendix 1: Peers in Distribution/Wholesale
Below we provide Hailiang International Holdings Ltd benchmarking against other companies in Distribution/Wholesale 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 |
|---|
| Forefront Group Ltd ($885) | | | 504.6% | 3,871.0% | |
| China LNG Group Ltd ($931) | -84.5% | 694.8% | 13.6% | 1,341.3% | |
| Sheng Yuan Holdings Ltd ($851) | | -86.1% | 756.9% | 567.2% | -2.1% |
| China Infrastructure Investment Ltd ($600) | 346.9% | 412.1% | -50.9% | 557.9% | |
| China-Hongkong Photo Products Holdings Ltd ($1123) | | 24.9% | 9.0% | 81.2% | 12.2% |
| |
|---|
| Median (37 companies) | 6.1% | 2.6% | 2.1% | 1.4% | -1.0% |
|---|
| Hailiang International Holdings Ltd ($2336) | | 9.7% | -30.8% | -69.1% | 99.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Goldin Financial Holdings Ltd ($530) | 67.0% | 75.3% | 71.7% | 74.8% | 73.8% |
| Forefront Group Ltd ($885) | | | | 69.8% | |
| YGM Trading Ltd ($375) | 67.1% | 66.5% | 67.4% | 64.0% | 62.5% |
| Goldlion Holdings Ltd ($533) | 57.3% | 56.4% | 54.1% | 55.7% | 60.0% |
| Sincere Watch Hong Kong Ltd ($444) | 34.2% | 35.6% | 39.7% | 38.8% | 38.3% |
| |
|---|
| Median (33 companies) | 16.4% | 17.5% | 18.2% | 19.3% | 22.8% |
|---|
| Hailiang International Holdings Ltd ($2336) | 8.8% | 7.3% | 3.6% | 4.0% | 2.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Goldin Financial Holdings Ltd ($530) | -134.6% | 163.7% | 613.4% | 285.7% | 364.1% |
| China LNG Group Ltd ($931) | 195.2% | 95.1% | 76.4% | 97.9% | |
| Forefront Group Ltd ($885) | | -2,113.8% | -803.1% | 57.7% | |
| China Infrastructure Investment Ltd ($600) | -1,171.2% | -274.9% | 120.0% | 52.0% | |
| GA Holdings Ltd ($8126) | -4.5% | 8.0% | 19.7% | 22.9% | |
| |
|---|
| Median (37 companies) | 2.2% | 2.1% | 2.5% | 4.6% | 4.4% |
|---|
| Hailiang International Holdings Ltd ($2336) | 4.5% | 2.8% | -1.7% | -17.2% | -14.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| C Y Foundation Group Ltd ($1182) | 9.8% | 2.5% | 5.2% | 82.2% | 9.3% |
| Inspur International Ltd ($596) | 0.9% | 8.4% | 12.2% | 33.6% | |
| SIS International Holdings ($529) | 0.2% | 13.4% | 31.8% | 14.8% | 49.8% |
| HKC International Holdings Ltd ($248) | 0.9% | 5.5% | 0.8% | 11.4% | 0.5% |
| Tan Chong International Ltd ($693) | 7.6% | 6.0% | 7.6% | 7.0% | |
| |
|---|
| Median (36 companies) | 1.5% | 1.4% | 1.8% | 1.6% | 1.2% |
|---|
| Hailiang International Holdings Ltd ($2336) | 0.3% | 0.7% | 0.4% | 1.8% | 0.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China LNG Group Ltd ($931) | 2.2% | 8.4% | 7.4% | 87.0% | |
| Yestar International Holdings Co Ltd ($2393) | 29.4% | 28.8% | 24.1% | 26.2% | 25.4% |
| Powerwell Pacific Holdings Ltd ($8265) | 27.8% | 6.4% | 6.4% | 23.6% | 27.1% |
| Forefront Group Ltd ($885) | -37.7% | -4.9% | -11.0% | 19.5% | |
| Sincere Watch Hong Kong Ltd ($444) | 46.4% | 51.7% | 27.7% | 14.6% | 5.5% |
| |
|---|
| Median (38 companies) | 2.5% | 2.4% | 1.7% | 3.2% | 2.5% |
|---|
| Hailiang International Holdings Ltd ($2336) | | | -2.8% | -8.0% | -6.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sheng Yuan Holdings Ltd ($851) | | | | 19.3x | 15.4x |
| Takson Holdings Ltd ($918) | | | 11.5x | 11.7x | 15.7x |
| Huiyin Household Appliances Holdings Co Ltd ($1280) | 10.1x | | | 10.9x | |
| Pacific Andes International Holdings Ltd ($1174) | 4.9x | 5.1x | 9.1x | 7.8x | |
| SIS International Holdings ($529) | -62.1x | -1.8x | 7.0x | 7.2x | 16.8x |
| |
|---|
| Median (27 companies) | -0.4x | -0.1x | -0.6x | -0.0x | -0.2x |
|---|
