Irico Group Electronics Co Ltd reports 179% Net Income growth while 33.0% Revenue decline
20/03/2016 • About Irico Group Electronics Co Ltd (
$438) • By InTwits
Irico Group Electronics Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Irico Group Electronics Co Ltd is a company in decline: 2015 revenue growth was -33.0%, 5 years revenue CAGR was -11.4%
- The company operates at negative EBITDA Margin: -4.7%
- Irico Group Electronics Co 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 -10.5%0
- Irico Group Electronics Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 41.1%. At the same time it's a lot of higher than industry average of 6.4%.
- CAPEX is quite volatile: 383 in 2015, 386 in 2014, 694 in 2013, 1,057 in 2012, 3,008 in 2011
- The company has unprofitable business model: ROIC is at -4.0%
- It operates with high leverage: Net Debt/EBITDA is 16.7x while industry average is 1.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Irico Group Electronics Co Ltd ($438) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 3,270 | 2,645 | 2,280 | 2,218 | 1,486 | -33.0% |
| Gross Profit | 106 | -99 | 66 | -45 | 32 | -171.8% |
| SG&A | | 589 | 535 | 501 | 234 | -53.4% |
| EBITDA | -115 | -539 | -162 | -366 | -69 | -81.1% |
| Net Income | -253 | -1,662 | -226 | -814 | 644 | -179.1% |
Balance Sheet
|
|---|
| Cash | 2,059 | 1,210 | 795 | 256 | 253 | -1.3% |
| Short Term Debt | 1,847 | 3,025 | 3,682 | 4,157 | 1,645 | -60.4% |
| Long Term Debt | 4,308 | 4,927 | 3,263 | 2,097 | 227 | -89.2% |
Cash flow
|
|---|
| Capex | 3,008 | 1,057 | 694 | 386 | 383 | -0.8% |
Ratios
|
|---|
| Revenue growth | 20.3% | -19.1% | -13.8% | -2.7% | -33.0% | |
| EBITDA growth | -148.9% | 370.7% | -70.0% | 126.7% | -81.1% | |
| Gross Margin | 3.2% | -3.7% | 2.9% | -2.0% | 2.2% | 4.2% |
| EBITDA Margin | -3.5% | -20.4% | -7.1% | -16.5% | -4.7% | 11.9% |
| Net Income Margin | -7.7% | -62.8% | -9.9% | -36.7% | 43.3% | 80.0% |
| SG&A, % of revenue | | 22.3% | 23.5% | 22.6% | 15.7% | -6.9% |
| CAPEX, % of revenue | 92.0% | 39.9% | 30.4% | 17.4% | 25.8% | 8.4% |
| ROIC | -2.1% | -6.5% | -3.3% | -7.2% | -4.0% | 3.2% |
| ROE | -12.7% | -161.0% | | | | 0.0% |
Revenue and profitability
Irico Group Electronics Co Ltd's Revenue dropped on 33.0% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin surged on 11.9 pp from -16.5% to -4.7% in 2015.
Gross Margin increased on 4.2 pp from -2.0% to 2.2% in 2015. SG&A as a % of Revenue decreased on 6.9 pp from 22.6% to 15.7% in 2015.
Net Income marign surged on 80.0 pp from -36.7% to 43.3% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Irico Group Electronics Co Ltd had CAPEX/Revenue of 25.8%. The company showed big decline in CAPEX/Revenue of 14.2 pp from 39.9% in 2012 to 25.8% in 2015. For the last three years the average CAPEX/Revenue was 24.5%.
Leverage (Debt)
Debt level is 16.7x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2015. Debt dropped on 70.1% in 2015 while cash decreased slightly on 1.3% in 2015.
Appendix 1: Peers in Electronics
Below you can find Irico Group Electronics Co Ltd benchmarking vs. other companies in Electronics 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 |
|---|
| China Netcom Technology Holdings Ltd ($8071) | -22.0% | 11.6% | -23.0% | 104.1% | |
| Technovator International Ltd ($1206) | 31.6% | 27.4% | 34.1% | 35.9% | |
| Tongda Group Holdings Ltd ($698) | | 8.3% | 6.4% | 32.1% | 26.8% |
| Advanced Card Systems Holdings Ltd ($8210) | 25.3% | 36.9% | 20.8% | 26.7% | |
| Alltronics Holdings Ltd ($833) | 33.9% | -1.6% | -1.6% | 23.4% | |
| |
|---|
| Median (48 companies) | 7.0% | -1.0% | 3.6% | 5.0% | 0.4% |
|---|
| Irico Group Electronics Co Ltd ($438) | | -19.1% | -13.8% | -2.7% | -33.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Advanced Card Systems Holdings Ltd ($8210) | 51.4% | 54.0% | 58.1% | 49.5% | |
| AAC Technologies Holdings Inc ($2018) | 44.0% | 44.2% | 42.7% | 41.4% | |
| TeleEye Holdings Ltd ($8051) | 51.6% | 44.0% | 42.1% | 38.5% | 37.0% |
| Wasion Group Holdings Ltd ($3393) | 30.3% | 32.8% | 35.1% | 34.2% | 30.2% |
| Datronix Holdings Ltd ($889) | 41.3% | 32.9% | 32.0% | 34.1% | |
| |
|---|
| Median (46 companies) | 15.0% | 14.6% | 13.8% | 14.1% | 17.3% |
|---|
| Irico Group Electronics Co Ltd ($438) | 3.2% | -3.7% | 2.9% | -2.0% | 2.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AAC Technologies Holdings Inc ($2018) | 35.2% | 35.8% | 35.8% | 34.9% | |
| Nanjing Sample Technology Co Ltd ($1708) | 31.5% | 26.8% | 21.1% | 22.3% | |
| Wasion Group Holdings Ltd ($3393) | 18.9% | 18.8% | 21.2% | 22.0% | 19.3% |
| Technovator International Ltd ($1206) | 19.2% | 19.0% | 19.0% | 20.8% | |
| Trigiant Group Ltd ($1300) | 17.0% | 17.6% | 18.2% | 18.5% | 16.2% |
| |
|---|
| Median (48 companies) | 9.3% | 7.4% | 6.0% | 4.6% | 5.1% |
|---|
| Irico Group Electronics Co Ltd ($438) | -3.5% | -20.4% | -7.1% | -16.5% | -4.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AKM Industrial Co Ltd ($1639) | 7.4% | 5.0% | 17.4% | 25.2% | |
| AAC Technologies Holdings Inc ($2018) | 25.9% | 18.7% | 8.7% | 19.6% | |
| Tech Pro Technology Development Ltd ($3823) | 32.8% | 7.6% | 13.1% | 15.4% | |
| Nanjing Sample Technology Co Ltd ($1708) | 3.7% | 23.9% | 15.5% | 12.0% | |
| Tongda Group Holdings Ltd ($698) | 5.7% | 7.8% | 4.9% | 11.4% | 16.2% |
| |
|---|
| Median (48 companies) | 3.3% | 3.7% | 3.0% | 3.7% | 3.0% |
|---|
| Irico Group Electronics Co Ltd ($438) | 92.0% | 39.9% | 30.4% | 17.4% | 25.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AAC Technologies Holdings Inc ($2018) | 22.3% | 29.1% | 30.0% | 26.0% | |
| Advanced Card Systems Holdings Ltd ($8210) | 15.5% | 26.7% | 24.7% | 20.2% | |
| Alltronics Holdings Ltd ($833) | 19.3% | 13.1% | 15.2% | 19.8% | |
| Tongda Group Holdings Ltd ($698) | 14.3% | 15.2% | 13.5% | 16.5% | 16.3% |
| Trigiant Group Ltd ($1300) | 17.9% | 17.8% | 18.3% | 15.2% | 11.2% |
| |
|---|
| Median (48 companies) | 5.9% | 4.3% | 3.5% | 3.0% | 1.8% |
|---|
| Irico Group Electronics Co Ltd ($438) | -2.1% | -6.5% | -3.3% | -7.2% | -4.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| National Electronic Hldgs ($213) | 43.0x | 16.3x | 30.2x | 84.8x | 19.9x |
| Sino-Tech International Holdings Ltd ($724) | | | 15.7x | 24.7x | |
| Eyang Holdings Group Co Ltd ($117) | 4.2x | 3.3x | 3.7x | 17.9x | |
| SAS Dragon Hldg Ltd ($1184) | 2.8x | 7.1x | 2.0x | 6.4x | |
| Willas-Array Electronics Holdings Ltd ($854) | 2.8x | 2.2x | 2.6x | 5.7x | 5.4x |
| |
|---|
| Median (35 companies) | 0.7x | 1.0x | 1.1x | 1.2x | 1.3x |
|---|
