Wai Kee Holdings Ltd EBITDA jumped on 68.9% in 2015 and EBITDA Margin increased slightly on 0.98 pp from 3.4% to 4.4%
20/03/2016 • About Wai Kee Holdings Ltd (
$610) • By InTwits
Wai Kee Holdings 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: 4.4% in 2015, 3.4% in 2014, 1.9% in 2013, -0.6% in 2012, 4.9% in 2011
- Wai Kee Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.5%. At the same time it's in pair with industry average of 3.7%.
- CAPEX is quite volatile: 232 in 2015, 99.6 in 2014, 53.3 in 2013, 35.5 in 2012, 81.6 in 2011
- The company has potentially unprofitable business model: ROIC is at 2.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Wai Kee Holdings Ltd ($610) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,248 | 2,418 | 2,546 | 3,833 | 5,019 | 31.0% |
| Gross Profit | 113 | 194 | 240 | 377 | 441 | 17.2% |
| SG&A | 211 | 238 | 266 | 334 | 353 | 5.4% |
| EBITDA | 61 | -15 | 49 | 129 | 219 | 68.9% |
| Net Income | 291 | 327 | 440 | 543 | 421 | -22.4% |
Balance Sheet
|
|---|
| Cash | 124 | 175 | 341 | 453 | 882 | 94.6% |
| Short Term Debt | 183 | 219 | 224 | 283 | 325 | 14.9% |
| Long Term Debt | 14 | 0 | 15 | 12 | 169 | 1,306.0% |
Cash flow
|
|---|
| Capex | 82 | 36 | 53 | 100 | 232 | 132.4% |
Ratios
|
|---|
| Revenue growth | 70.0% | 93.7% | 5.3% | 50.5% | 31.0% | |
| EBITDA growth | -188.5% | -124.3% | -429.7% | 164.6% | 68.9% | |
| Gross Margin | 9.1% | 8.0% | 9.4% | 9.8% | 8.8% | -1.0% |
| EBITDA Margin | 4.9% | -0.6% | 1.9% | 3.4% | 4.4% | 1.0% |
| Net Income Margin | 23.3% | 13.5% | 17.3% | 14.2% | 8.4% | -5.8% |
| SG&A, % of revenue | 16.9% | 9.8% | 10.5% | 8.7% | 7.0% | -1.7% |
| CAPEX, % of revenue | 6.5% | 1.5% | 2.1% | 2.6% | 4.6% | 2.0% |
| ROIC | 0.6% | -1.0% | 0.1% | 1.4% | 2.7% | 1.3% |
| ROE | 6.9% | 7.1% | 8.8% | 10.0% | 7.4% | -2.6% |
| Net Debt/EBITDA | 1.2x | | -2.1x | -1.2x | -1.8x | -0.6x |
Revenue and profitability
The company's Revenue jumped on 31.0% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin jumped on 13.8 pp from 16.6% to 30.5% in 2015.
Gross Margin decreased slightly on 1.0 pp from 9.8% to 8.8% in 2015. SG&A as a % of Revenue decreased slightly on 1.7 pp from 8.7% to 7.0% in 2015.
Net Income marign decreased on 5.8 pp from 14.2% to 8.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Wai Kee Holdings Ltd had CAPEX/Revenue of 4.6%. The company's CAPEX/Revenue increased on 3.1 pp from 1.5% in 2012 to 4.6% in 2015. For the last three years the average CAPEX/Revenue was 3.1%.Wai Kee Holdings Ltd has spent a lot to CAPEX (106% of EBITDA) to fuel its growth.
Return on investment
The company operates at low ROIC (2.67%) and ROE (7.44%). ROIC increased slightly on 1.3 pp from 1.4% to 2.7% in 2015. ROE decreased on 2.6 pp from 10.0% to 7.4% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.8x and Debt / EBITDA is 2.3x. Net Debt / EBITDA dropped on 0.6x from -1.2x to -1.8x in 2015. Debt surged on 67.4% in 2015 while cash jumped on 94.6% in 2015.
Appendix 1: Peers in Engineering&Construction
Below you can find Wai Kee Holdings Ltd benchmarking vs. other companies in Engineering&Construction 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 |
|---|
| Richly Field China Development Ltd ($313) | | | -45.0% | 464.2% | -65.7% |
| Junefield Department Store Group Ltd ($758) | 22.9% | -20.3% | -24.9% | 126.6% | |
| CNQC International Holdings Ltd ($1240) | 401.9% | 21.6% | 91.0% | 103.7% | |
| Wison Engineering Services Co Ltd ($2236) | 1.2% | -2.9% | -24.9% | 90.3% | |
| China Resources and Transportation Group Ltd ($269) | | 939.8% | 3,196.3% | 87.9% | -41.6% |
| |
|---|
| Median (41 companies) | 12.5% | 9.2% | 21.3% | 11.7% | 11.9% |
|---|
| Wai Kee Holdings Ltd ($610) | | 93.7% | 5.3% | 50.5% | 31.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huayu Expressway Group Ltd ($1823) | 2.2% | 43.6% | 65.6% | 64.0% | |
| HNA Infrastructure Company Ltd ($357) | 61.6% | 66.4% | 62.1% | 62.4% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 50.1% | 54.1% | 54.3% | 41.5% | |
| Kingbo Strike Ltd ($1421) | 22.9% | 32.4% | 44.4% | 40.3% | 30.7% |
| Grand Ming Group Holdings Ltd ($1271) | 20.4% | 11.0% | 18.1% | 35.7% | 19.7% |
| |
|---|
| Median (36 companies) | 11.5% | 12.8% | 12.9% | 13.3% | 12.9% |
|---|
| Wai Kee Holdings Ltd ($610) | 9.1% | 8.0% | 9.4% | 9.8% | 8.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huayu Expressway Group Ltd ($1823) | -0.5% | 46.2% | 73.8% | 77.1% | |
| HNA Infrastructure Company Ltd ($357) | 60.0% | 62.8% | 63.7% | 62.8% | |
| Beijing Capital International Airport Co Ltd ($694) | 55.1% | 53.4% | 52.9% | 50.3% | |
| Cheung Kong Infrastructure Holdings Ltd ($1038) | 39.8% | 31.2% | 20.6% | 36.2% | 60.9% |
| Grand Ming Group Holdings Ltd ($1271) | 17.5% | 10.0% | 15.8% | 31.0% | 19.0% |
| |
|---|
| Median (42 companies) | 9.2% | 9.8% | 8.2% | 7.1% | 6.2% |
|---|
| Wai Kee Holdings Ltd ($610) | 4.9% | -0.6% | 1.9% | 3.4% | 4.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HNA Infrastructure Company Ltd ($357) | 43.3% | 36.8% | 5.7% | 85.4% | |
| PYI Corp Ltd ($498) | 6.6% | 3.7% | 4.2% | 24.5% | 13.1% |
| Shun Cheong Holdings ($650) | 7.2% | 16.4% | 8.0% | 23.9% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 6.1% | 4.2% | 7.7% | 20.2% | |
| KFM Kingdom Holdings Ltd ($3816) | 6.5% | 4.6% | 11.5% | 14.9% | 9.6% |
| |
|---|
| Median (42 companies) | 4.4% | 2.5% | 3.1% | 1.7% | 2.4% |
|---|
| Wai Kee Holdings Ltd ($610) | 6.5% | 1.5% | 2.1% | 2.6% | 4.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chun Sing Engineering Holdings Ltd ($2277) | | | 98.3% | 54.9% | 43.7% |
| Kingbo Strike Ltd ($1421) | | 56.9% | 125.4% | 48.9% | 11.4% |
| Ngai Shun Holdings Ltd ($1246) | | 68.8% | 77.2% | 45.2% | 31.0% |
| CNQC International Holdings Ltd ($1240) | 23.1% | 12.2% | 22.3% | 40.4% | |
| China Saite Group Co Ltd ($153) | 46.3% | 64.0% | 53.2% | 35.3% | |
| |
|---|
| Median (43 companies) | 7.0% | 6.1% | 5.5% | 4.3% | 2.5% |
|---|
| Wai Kee Holdings Ltd ($610) | 0.6% | -1.0% | 0.1% | 1.4% | 2.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Resources and Transportation Group Ltd ($269) | | | | 66.7x | 29.7x |
| CNC Holdings Ltd ($8356) | -0.7x | | 22.0x | 21.9x | 24.3x |
| Deson Development International Holdings ($262) | 3.1x | 3.8x | 4.9x | 13.7x | 47.0x |
| Chun Wo Development Holdings Ltd ($711) | | 14.3x | 8.1x | 12.6x | 15.9x |
| Hsin Chong Construction Group Ltd ($404) | 4.3x | 1.8x | 8.0x | 10.2x | |
| |
|---|
| Median (35 companies) | 0.5x | 1.5x | 1.9x | 2.6x | 2.7x |
|---|
| Wai Kee Holdings Ltd ($610) | 1.2x | | -2.1x | -1.2x | -1.8x |
