Lung Kee Bermuda Holdings EBITDA surged on 23.5% in 2015 and EBITDA Margin increased on 3.5 pp from 11.7% to 15.2%
18/03/2016 • About Lung Kee Bermuda Holdings (
$255) • By InTwits
Lung Kee Bermuda Holdings reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Lung Kee Bermuda Holdings is a company in decline: 2015 revenue growth was -5.2%, 5 years revenue CAGR was -2.7%
- Lung Kee Bermuda Holdings has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.7%. At the same time it's in pair with industry average of 6.1%.
- CAPEX is quite volatile: 103 in 2015, 263 in 2014, 213 in 2013, 278 in 2012, 555 in 2011
- The company has potentially unprofitable business model: ROIC is at 4.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Lung Kee Bermuda Holdings ($255) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,532 | 2,402 | 2,221 | 2,403 | 2,279 | -5.2% |
| EBITDA | 488 | 367 | 329 | 281 | 347 | 23.5% |
| Net Income | 278 | 197 | 145 | 138 | 126 | -8.9% |
Balance Sheet
|
|---|
| Cash | 653 | 805 | 737 | 384 | 505 | 31.6% |
| Short Term Debt | 290 | 253 | 224 | 123 | 24 | -80.9% |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 555 | 278 | 213 | 263 | 103 | -61.0% |
Ratios
|
|---|
| Revenue growth | -3.0% | -5.2% | -7.5% | 8.2% | -5.2% | |
| EBITDA growth | -20.0% | -24.8% | -10.2% | -14.8% | 23.5% | |
| EBITDA Margin | 19.3% | 15.3% | 14.8% | 11.7% | 15.2% | 3.5% |
| Net Income Margin | 11.0% | 8.2% | 6.5% | 5.7% | 5.5% | -0.2% |
| CAPEX, % of revenue | 21.9% | 11.6% | 9.6% | 11.0% | 4.5% | -6.5% |
| ROIC | 12.3% | 6.7% | 4.9% | 3.2% | 4.8% | 1.6% |
| ROE | 12.4% | 8.3% | 5.9% | 5.7% | 5.4% | -0.3% |
| Net Debt/EBITDA | -0.7x | -1.5x | -1.6x | -0.9x | -1.4x | -0.5x |
Revenue and profitability
The company's Revenue decreased on 5.2% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 3.5 pp from 11.7% to 15.2% in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 4.5% in 2015. CAPEX/Revenue decreased on 7.1 pp from 11.6% in 2012 to 4.5% in 2015. Average CAPEX/Revenue for the last three years was 8.3%.
Return on investment
The company operates at low ROIC (4.79%) and ROE (5.40%). ROIC increased slightly on 1.6 pp from 3.2% to 4.8% in 2015. ROE showed almost no change in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.4x and Debt / EBITDA is 0.1x. Net Debt / EBITDA dropped on 0.5x from -0.9x to -1.4x in 2015. Debt dropped on 80.9% in 2015 while cash jumped on 31.6% in 2015.
Appendix 1: Peers in Metal Fabricate/Hardware
Below we provide Lung Kee Bermuda Holdings benchmarking against other companies in Metal Fabricate/Hardware 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 |
|---|
| Burwill Holdings Ltd ($24) | 25.4% | -35.5% | -9.2% | 39.2% | |
| Chu Kong Petroleum & Natural Gas Steel Pipe Holdings Ltd ($1938) | 100.8% | 16.3% | -48.4% | 32.2% | |
| EVA Precision Industrial Holdings Ltd ($838) | 16.1% | 19.7% | 12.2% | 30.1% | |
| China Zhongwang Holdings Ltd ($1333) | -2.1% | 31.0% | 6.0% | 11.6% | |
| Shougang Concord Century Holdings Ltd ($103) | 6.7% | -4.9% | 10.0% | -3.8% | |
| |
|---|
| Median (8 companies) | 27.9% | 10.8% | 11.1% | 3.9% | |
|---|
| Lung Kee Bermuda Holdings ($255) | | -5.2% | -7.5% | 8.2% | -5.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 21.6% | 24.2% | 26.8% | 28.0% | |
| EVA Precision Industrial Holdings Ltd ($838) | 24.7% | 21.6% | 24.1% | 26.2% | |
| New Times Energy Corp Ltd ($166) | 1.0% | -2.7% | 0.8% | 22.6% | |
| Ka Shui International Holdings Ltd ($822) | 19.4% | 22.5% | 22.1% | 19.6% | |
| Chu Kong Petroleum & Natural Gas Steel Pipe Holdings Ltd ($1938) | 15.1% | 17.0% | 15.4% | 11.6% | |
| |
|---|
| Median (8 companies) | 12.2% | 10.3% | 13.5% | 15.6% | |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 22.0% | 22.3% | 24.3% | 24.2% | |
| EVA Precision Industrial Holdings Ltd ($838) | 16.8% | 10.4% | 9.9% | 16.7% | |
| Ka Shui International Holdings Ltd ($822) | 12.6% | 14.3% | 9.5% | 12.0% | |
| Shougang Concord Century Holdings Ltd ($103) | 8.8% | -0.2% | 11.2% | 5.2% | |
| Burwill Holdings Ltd ($24) | 0.6% | -0.8% | -0.6% | -0.4% | |
| |
|---|
| Median (8 companies) | 9.9% | 8.9% | 7.7% | 2.4% | |
|---|
| Lung Kee Bermuda Holdings ($255) | 19.3% | 15.3% | 14.8% | 11.7% | 15.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 25.1% | 56.3% | 41.6% | 54.8% | |
| New Times Energy Corp Ltd ($166) | 9.0% | 11.4% | 1.7% | 52.1% | |
| Chu Kong Petroleum & Natural Gas Steel Pipe Holdings Ltd ($1938) | 20.3% | 25.9% | 71.7% | 31.4% | |
| Ka Shui International Holdings Ltd ($822) | 5.0% | 9.3% | 7.4% | 11.1% | |
| EVA Precision Industrial Holdings Ltd ($838) | 15.3% | 9.2% | 6.3% | 6.3% | |
| |
|---|
| Median (8 companies) | 12.1% | 10.3% | 6.8% | 8.7% | |
|---|
| Lung Kee Bermuda Holdings ($255) | 21.9% | 11.6% | 9.6% | 11.0% | 4.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| EVA Precision Industrial Holdings Ltd ($838) | 10.5% | 3.3% | 1.9% | 9.1% | |
| Ka Shui International Holdings Ltd ($822) | 10.5% | 14.6% | 7.1% | 7.6% | |
| China Zhongwang Holdings Ltd ($1333) | 7.8% | 9.5% | 8.8% | 7.4% | |
| Burwill Holdings Ltd ($24) | 0.8% | -1.8% | -1.5% | -1.6% | |
| Shougang Concord Century Holdings Ltd ($103) | 0.6% | -4.8% | 1.6% | -1.9% | |
| |
|---|
| Median (8 companies) | 5.9% | 2.9% | 1.8% | -1.7% | |
|---|
| Lung Kee Bermuda Holdings ($255) | 12.3% | 6.7% | 4.9% | 3.2% | 4.8% |
Top companies by Net Debt / EBITDA
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shougang Concord Century Holdings Ltd ($103) | 7.6x | | 6.2x | 13.2x | |
| China Zhongwang Holdings Ltd ($1333) | -0.8x | 1.3x | 2.6x | 4.1x | |
| Ka Shui International Holdings Ltd ($822) | 0.7x | 0.9x | 1.3x | 1.7x | |
| EVA Precision Industrial Holdings Ltd ($838) | -0.4x | 1.1x | 1.8x | 1.2x | |
| |
|---|
| Median (4 companies) | 1.9x | 1.3x | 4.4x | 2.9x | |
|---|
| Lung Kee Bermuda Holdings ($255) | -0.7x | -1.5x | -1.6x | -0.9x | -1.4x |
