CIMC Enric Holdings Ltd reports 49.5% Net Income decline and 26.9% Revenue decline
21/03/2016 • About CIMC Enric Holdings Ltd (
$3899) • By InTwits
CIMC Enric Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- CIMC Enric Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.3%. At the same time it's in pair with industry average of 5.8%.
- CAPEX is quite volatile: 3,109 in 2015, 1,110 in 2014, 6,356 in 2013, 1,328 in 2012, 222 in 2011
- The company has business model with low profitability: ROIC is at 8.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
CIMC Enric Holdings Ltd ($3899) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 6,829 | 8,083 | 8,063 | 11,267 | 8,241 | -26.9% |
| Gross Profit | 1,279 | 1,578 | 1,645 | 2,123 | 1,533 | -27.8% |
| SG&A | 670 | 824 | 846 | 1,147 | 1,020 | -11.0% |
| EBITDA | 837 | 1,056 | 1,126 | 1,409 | 874 | -38.0% |
| Net Income | 572 | 760 | 776 | 1,028 | 519 | -49.5% |
Balance Sheet
|
|---|
| Cash | 976 | 945 | 1,204 | 1,682 | 2,035 | 21.0% |
| Short Term Debt | 563 | 461 | 670 | 170 | 815 | 378.0% |
| Long Term Debt | 195 | 137 | 28 | 25 | 933 | 3,599.3% |
Cash flow
|
|---|
| Capex | 460 | 428 | 262 | 388 | 209 | -46.0% |
Ratios
|
|---|
| Revenue growth | 70.8% | 18.4% | -0.3% | 39.7% | -26.9% | |
| EBITDA growth | 78.0% | 26.2% | 6.7% | 25.1% | -38.0% | |
| Gross Margin | 18.7% | 19.5% | 20.4% | 18.8% | 18.6% | -0.2% |
| EBITDA Margin | 12.3% | 13.1% | 14.0% | 12.5% | 10.6% | -1.9% |
| Net Income Margin | 8.4% | 9.4% | 9.6% | 9.1% | 6.3% | -2.8% |
| SG&A, % of revenue | 9.8% | 10.2% | 10.5% | 10.2% | 12.4% | 2.2% |
| CAPEX, % of revenue | 6.7% | 5.3% | 3.3% | 3.4% | 2.5% | -0.9% |
| ROIC | 19.4% | 20.3% | 20.0% | 21.3% | 8.9% | -12.4% |
| ROE | 16.4% | 19.6% | 19.0% | 20.1% | 8.4% | -11.8% |
| Net Debt/EBITDA | -0.3x | -0.3x | -0.4x | -1.1x | -0.3x | 0.7x |
Revenue and profitability
CIMC Enric Holdings Ltd's Revenue dropped on 26.9% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.9 pp from 12.5% to 10.6% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue increased on 2.2 pp from 10.2% to 12.4% in 2015.
Net Income marign decreased on 2.8 pp from 9.1% to 6.3% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 CIMC Enric Holdings Ltd had CAPEX/Revenue of 2.5%. The company showed decline in CAPEX/Revenue of 2.8 pp from 5.3% in 2012 to 2.5% in 2015. Average CAPEX/Revenue for the last three years was 3.1%.
Return on investment
The company operates at low ROIC (8.86%) and ROE (8.38%). ROIC dropped on 12.4 pp from 21.3% to 8.9% in 2015. ROE dropped on 11.8 pp from 20.1% to 8.4% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.3x and Debt / EBITDA is 2.0x. Net Debt / EBITDA jumped on 0.7x from -1.1x to -0.3x in 2015. Debt surged on 793% in 2015 while cash surged on 21.0% in 2015.
Appendix 1: Peers in Oil&Gas Services
Below we provide CIMC Enric Holdings Ltd benchmarking against other companies in Oil&Gas Services 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 |
|---|
| Yuan Heng Gas Holdings Ltd ($332) | | 196.3% | 207.4% | 105.9% | -36.4% |
| TSC Group Holdings Ltd ($206) | -2.8% | 31.7% | 9.9% | 34.0% | |
| China Oilfield Services Ltd ($2883) | 4.9% | 20.0% | 23.8% | 20.6% | |
| Sinopec Engineering Group Co Ltd ($2386) | | 25.9% | 13.1% | 13.3% | -7.8% |
| Jutal Offshore Oil Services Ltd ($3303) | 15.3% | 23.4% | 46.2% | 6.9% | |
| |
|---|
| Median (12 companies) | 15.3% | 28.8% | 11.5% | 0.5% | -7.8% |
|---|
| CIMC Enric Holdings Ltd ($3899) | | 18.4% | -0.3% | 39.7% | -26.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hilong Holding Ltd ($1623) | 41.0% | 39.5% | 40.3% | 39.6% | 32.6% |
| Anton Oilfield Services Group/Hong Kong ($3337) | 41.5% | 45.0% | 44.3% | 31.2% | |
| TSC Group Holdings Ltd ($206) | 38.0% | 30.7% | 31.6% | 27.8% | |
| Jutal Offshore Oil Services Ltd ($3303) | 20.3% | 21.7% | 25.1% | 19.6% | |
| Sinopec Engineering Group Co Ltd ($2386) | 16.6% | 14.3% | 14.7% | 12.7% | 13.5% |
| |
|---|
| Median (9 companies) | 20.3% | 14.3% | 14.7% | 12.7% | 13.5% |
|---|
| CIMC Enric Holdings Ltd ($3899) | 18.7% | 19.5% | 20.4% | 18.8% | 18.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hans Energy Co Ltd ($554) | -38.3% | 40.4% | 45.0% | 42.8% | 42.7% |
| China Oilfield Services Ltd ($2883) | 43.7% | 39.8% | 40.0% | 37.0% | |
| Hilong Holding Ltd ($1623) | 28.5% | 25.9% | 27.8% | 28.8% | 22.7% |
| SPT Energy Group Inc ($1251) | 24.7% | 23.8% | 19.8% | 14.1% | -36.0% |
| TSC Group Holdings Ltd ($206) | 11.7% | 11.4% | 14.0% | 13.2% | |
| |
|---|
| Median (12 companies) | 12.6% | 15.4% | 16.9% | 11.0% | 9.3% |
|---|
| CIMC Enric Holdings Ltd ($3899) | 12.3% | 13.1% | 14.0% | 12.5% | 10.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Petro-King Oilfield Services Ltd ($2178) | 8.2% | 13.3% | 13.3% | 75.4% | |
| Hilong Holding Ltd ($1623) | 17.1% | 16.7% | 18.9% | 48.1% | 9.6% |
| China Oilfield Services Ltd ($2883) | 24.9% | 16.5% | 30.9% | 29.8% | |
| Anton Oilfield Services Group/Hong Kong ($3337) | 13.3% | 12.6% | 32.2% | 22.8% | |
| Jutal Offshore Oil Services Ltd ($3303) | 6.6% | 12.8% | 8.4% | 12.9% | |
| |
|---|
| Median (12 companies) | 6.7% | 10.0% | 6.3% | 7.3% | 4.8% |
|---|
| CIMC Enric Holdings Ltd ($3899) | 6.7% | 5.3% | 3.3% | 3.4% | 2.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Yuan Heng Gas Holdings Ltd ($332) | | -59.8% | -0.0% | 25.6% | 3.9% |
| Sinopec Engineering Group Co Ltd ($2386) | 59.6% | 77.5% | 33.3% | 18.6% | 15.3% |
| Hilong Holding Ltd ($1623) | 19.0% | 15.5% | 14.8% | 12.0% | 6.0% |
| China Oilfield Services Ltd ($2883) | 8.6% | 8.9% | 11.2% | 11.6% | |
| TSC Group Holdings Ltd ($206) | 5.2% | 6.7% | 9.1% | 10.5% | |
| |
|---|
| Median (12 companies) | 8.3% | 7.8% | 10.1% | 7.9% | 3.9% |
|---|
| CIMC Enric Holdings Ltd ($3899) | 19.4% | 20.3% | 20.0% | 21.3% | 8.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hans Energy Co Ltd ($554) | | 14.0x | 11.9x | 12.9x | 11.3x |
| Anton Oilfield Services Group/Hong Kong ($3337) | -0.5x | 0.0x | 0.9x | 7.4x | |
| Yuan Heng Gas Holdings Ltd ($332) | | | | 2.7x | 8.9x |
| Hilong Holding Ltd ($1623) | 0.8x | 0.9x | 1.1x | 2.6x | 3.3x |
| Sinopec Kantons Holdings Ltd ($934) | -1.2x | -7.1x | -7.4x | 2.5x | |
| |
|---|
| Median (11 companies) | 0.2x | 0.1x | -0.0x | 1.8x | 6.1x |
|---|
| CIMC Enric Holdings Ltd ($3899) | -0.3x | -0.3x | -0.4x | -1.1x | -0.3x |
