Theme International Holdings Ltd reports 29.0% revenue decline in 2015 and 11.6 pp EBITDA Margin decline from -25.0% to -36.6%
18/03/2016 • About Theme International Holdings Ltd (
$990) • By InTwits
Theme International Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Theme International Holdings Ltd is a company in decline: 2015 revenue growth was -29.0%, 5 years revenue CAGR was -10.3%
- The company operates at negative EBITDA Margin: -36.6%
- Theme International Holdings Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 is 0.0%. Average EBITDA Margin for the same period was -35.1%0
- Theme International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.3%. At the same time it's a lot of higher than industry average of 5.3%.
- CAPEX is quite volatile: 2.0 in 2015, 3.3 in 2014, 3.1 in 2013, 1.2 in 2012, 3.8 in 2011
- The company has unprofitable business model: ROIC is at -40.1%
- It operates with high leverage: Net Debt/EBITDA is 4.4x while industry average is -0.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Theme International Holdings Ltd ($990) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 99.730 | 89.762 | 87.274 | 77.492 | 55.044 | -29.0% |
| Gross Profit | 56.518 | 44.629 | 49.394 | 43.196 | 12.626 | -70.8% |
| SG&A | | 79.633 | 64.387 | 65.298 | 35.880 | -45.1% |
| EBITDA | -60.717 | -31.373 | -11.968 | -19.390 | -20.136 | 3.8% |
| Net Income | -64.681 | -43.286 | -15.341 | -22.253 | -23.383 | 5.1% |
Balance Sheet
|
|---|
| Cash | 38.436 | 25.978 | 29.712 | 25.221 | 12.272 | -51.3% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 35.000 | 0.000 | -100.0% |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 3.842 | 1.232 | 3.131 | 3.275 | 1.988 | -39.3% |
Ratios
|
|---|
| Revenue growth | 5.4% | -10.0% | -2.8% | -11.2% | -29.0% | |
| EBITDA growth | 30.9% | -48.3% | -61.9% | 62.0% | 3.8% | |
| Gross Margin | 56.7% | 49.7% | 56.6% | 55.7% | 22.9% | -32.8% |
| EBITDA Margin | -60.9% | -35.0% | -13.7% | -25.0% | -36.6% | -11.6% |
| Net Income Margin | -64.9% | -48.2% | -17.6% | -28.7% | -42.5% | -13.8% |
| SG&A, % of revenue | | 88.7% | 73.8% | 84.3% | 65.2% | -19.1% |
| CAPEX, % of revenue | 3.9% | 1.4% | 3.6% | 4.2% | 3.6% | -0.6% |
| ROIC | -100.3% | -83.3% | -74.3% | -114.4% | -40.1% | 74.2% |
| ROE | -102.0% | -104.2% | -77.1% | | | 0.0% |
Revenue and profitability
Theme International Holdings Ltd's Revenue dropped on 29.0% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 33.1 pp from -39.0% to -5.9% in FY2015.
Gross Margin dropped on 32.8 pp from 55.7% to 22.9% in 2015. SG&A as a % of Revenue dropped on 19.1 pp from 84.3% to 65.2% in 2015.
Net Income marign dropped on 13.8 pp from -28.7% to -42.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 3.6%. The company's CAPEX/Revenue increased on 2.2 pp from 1.4% in 2012 to 3.6% in 2015. For the last three years the average CAPEX/Revenue was 3.8%.
Leverage (Debt)
The company paid down all the debt in 2015. Cash dropped on 51.3% in 2015.
Appendix 1: Peers in Retail
Below we provide Theme International Holdings Ltd benchmarking against other companies in Retail 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 |
|---|
| China Household Holdings Ltd ($692) | -87.0% | -32.8% | 5,357.9% | 76.2% | |
| Ming Fung Jewellery Group Ltd ($860) | | 3.3% | -14.9% | 54.3% | -70.8% |
| Merry Garden Holdings Ltd ($1237) | 53.9% | 37.1% | 12.8% | 47.6% | |
| Luk Fook Holdings International Ltd ($590) | | 47.2% | 12.6% | 43.3% | -17.1% |
| NewOcean Energy Holdings Ltd ($342) | | 23.1% | 15.9% | 36.0% | -21.0% |
| |
|---|
| Median (112 companies) | 25.6% | 10.7% | 6.3% | 3.3% | -0.8% |
|---|
| Theme International Holdings Ltd ($990) | | -10.0% | -2.8% | -11.2% | -29.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Culture Landmark Investment Ltd ($674) | 77.5% | 91.1% | 99.4% | 99.5% | |
| Modern Beauty Salon Holdings Ltd ($919) | 97.3% | 97.4% | 95.9% | 96.8% | 96.7% |
| Vongroup Ltd ($318) | | | | 95.1% | 99.1% |
| Nanjing Sinolife United Co Ltd ($3332) | 80.6% | 86.5% | 89.3% | 90.9% | |
| Embry Holdings Ltd ($1388) | 82.3% | 81.2% | 80.4% | 82.3% | |
| |
|---|
| Median (101 companies) | 38.8% | 36.7% | 36.4% | 35.3% | 42.0% |
|---|
| Theme International Holdings Ltd ($990) | 56.7% | 49.7% | 56.6% | 55.7% | 22.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Maoye International Holdings Ltd ($848) | 45.5% | 47.4% | 46.3% | 73.2% | 39.6% |
| China Dongxiang Group Co Ltd ($3818) | 5.6% | 6.0% | 5.6% | 58.3% | |
| Nanjing Sinolife United Co Ltd ($3332) | 47.8% | 51.6% | 56.9% | 54.4% | |
| Lifestyle International Holdings Ltd ($1212) | 49.6% | 47.5% | 47.0% | 44.7% | 43.4% |
| Golden Eagle Retail Group Ltd ($3308) | 52.1% | 48.5% | 47.3% | 42.8% | |
| |
|---|
| Median (111 companies) | 13.2% | 9.9% | 7.3% | 8.8% | 8.2% |
|---|
| Theme International Holdings Ltd ($990) | -60.9% | -35.0% | -13.7% | -25.0% | -36.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Intime Retail Group Co Ltd ($1833) | 58.4% | 28.3% | 55.4% | 37.0% | |
| Future Bright Holdings Ltd ($703) | 6.2% | 2.6% | 3.7% | 36.8% | 24.9% |
| Sage International Group Ltd ($8082) | 20.4% | 236.6% | 28.2% | 35.4% | |
| Maoye International Holdings Ltd ($848) | 30.9% | 32.8% | 24.1% | 31.5% | 17.7% |
| Tsui Wah Holdings Ltd ($1314) | 5.2% | 8.3% | 9.3% | 30.5% | 10.6% |
| |
|---|
| Median (112 companies) | 3.8% | 4.0% | 3.6% | 3.4% | 2.7% |
|---|
| Theme International Holdings Ltd ($990) | 3.9% | 1.4% | 3.6% | 4.2% | 3.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Modern Beauty Salon Holdings Ltd ($919) | 48.1% | 50.7% | -4.6% | 81.3% | 71.8% |
| Starbucks Corp ($4337) | 36.4% | 36.4% | -6.0% | 52.8% | 51.4% |
| Sa Sa International Holdings Ltd ($178) | 45.7% | 53.5% | 52.7% | 49.0% | 39.8% |
| Coach Inc ($6388) | 82.0% | 82.3% | 68.7% | 45.0% | 20.8% |
| Nanjing Sinolife United Co Ltd ($3332) | 57.4% | 67.3% | 68.1% | 32.2% | |
| |
|---|
| Median (112 companies) | 17.2% | 12.3% | 8.4% | 8.4% | 7.0% |
|---|
| Theme International Holdings Ltd ($990) | -100.3% | -83.3% | -74.3% | -114.4% | -40.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sparkle Roll Group Ltd ($970) | -0.8x | 0.6x | 4.0x | 9.3x | 23.5x |
| China Yongda Automobiles Services Holdings Ltd ($3669) | 3.3x | 3.4x | 4.7x | 5.5x | |
| Zhongsheng Group Holdings Ltd ($881) | 2.2x | 4.6x | 4.5x | 5.3x | |
| NewOcean Energy Holdings Ltd ($342) | 35.2x | 6.2x | 6.1x | 5.3x | 2.6x |
| Century Ginwa Retail Holdings Ltd ($162) | 6.5x | 2.0x | 2.5x | 4.8x | 7.3x |
| |
|---|
| Median (88 companies) | -0.8x | -0.5x | -0.8x | -0.2x | -0.5x |
|---|
