China Resources Power Holdings Co Ltd reports 31.3% CAPEX decline while 1.1% Revenue growth
21/03/2016 • About China Resources Power Holdings Co Ltd (
$836) • By InTwits
China Resources Power Holdings Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Resources Power Holdings Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 25.7%. At the same time it's a lot of higher than industry average of 5.5%.
- CAPEX is quite volatile: 16,811 in 2015, 24,483 in 2014, 23,258 in 2013, 10,374 in 2012, 12,373 in 2011
- The company has business model with average profitability: ROIC is at 11.0%
- It operates with high leverage: Net Debt/EBITDA is 2.7x while industry average is -0.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Resources Power Holdings Co Ltd ($836) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 60,709 | 62,436 | 69,582 | 70,681 | 71,436 | 1.1% |
| EBITDA | 13,535 | 17,805 | 23,587 | 23,467 | 29,937 | 27.6% |
| Net Income | 4,720 | 7,897 | 11,437 | 9,637 | 10,447 | 8.4% |
Balance Sheet
|
|---|
| Cash | 4,497 | 4,397 | 5,878 | 8,285 | 7,274 | -12.2% |
| Short Term Debt | 28,173 | 23,506 | 19,131 | 20,897 | 27,404 | 31.1% |
| Long Term Debt | 56,569 | 59,876 | 73,438 | 79,536 | 61,114 | -23.2% |
Cash flow
|
|---|
| Capex | 12,373 | 10,374 | 23,258 | 24,483 | 16,811 | -31.3% |
Ratios
|
|---|
| Revenue growth | 25.0% | 2.8% | 11.4% | 1.6% | 1.1% | |
| EBITDA growth | 11.9% | 31.5% | 32.5% | -0.5% | 27.6% | |
| EBITDA Margin | 22.3% | 28.5% | 33.9% | 33.2% | 41.9% | 8.7% |
| Net Income Margin | 7.8% | 12.6% | 16.4% | 13.6% | 14.6% | 1.0% |
| CAPEX, % of revenue | 20.4% | 16.6% | 33.4% | 34.6% | 23.5% | -11.1% |
| ROIC | 5.9% | 7.7% | 9.7% | 8.0% | 11.0% | 3.0% |
| ROE | 9.9% | 14.7% | 18.5% | 13.6% | 14.1% | 0.6% |
| Net Debt/EBITDA | 5.9x | 4.4x | 3.7x | 3.9x | 2.7x | -1.2x |
Revenue and profitability
China Resources Power Holdings Co Ltd's Revenue increased slightly on 1.1% in 2015. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 8.7 pp from 33.2% to 41.9% in 2015.
Net Income marign increased slightly on 0.99 pp from 13.6% to 14.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 23.5%. China Resources Power Holdings Co Ltd showed CAPEX/Revenue growth of 6.9 pp from 16.6% in 2012 to 23.5% in 2015. It's average level of CAPEX/Revenue for the last three years was 30.5%.The company maintained rich investment policy and has spent a big chunk of EBITDA (56.2%) to CAPEX.
Return on investment
The company operates at good ROE (14.15%) while ROIC is low (11.03%). ROIC increased on 3.0 pp from 8.0% to 11.0% in 2015. ROE increased slightly on 0.58 pp from 13.6% to 14.1% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.7x and Debt / EBITDA is 3.0x. Net Debt / EBITDA dropped on 1.2x from 3.9x to 2.7x in 2015. Debt dropped on 11.9% in 2015 while cash dropped on 12.2% in 2015.
Appendix 1: Peers in Electric
Below we provide China Resources Power Holdings Co Ltd benchmarking against other companies in Electric 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 |
|---|
| Tianjin Development Hldgs Ltd ($882) | 9.1% | 10.6% | 27.3% | 37.6% | |
| CGN Meiya Power Holdings Co Ltd ($1811) | | 23.4% | 11.2% | 30.8% | -16.5% |
| Enerchina Holdings Ltd ($622) | | -15.4% | 6.8% | 28.5% | -3.5% |
| Amber Energy Ltd ($90) | | -14.7% | 21.2% | 20.1% | -56.4% |
| CGN Power Co Ltd ($1816) | | 10.7% | -1.2% | 19.3% | 12.3% |
| |
|---|
| Median (16 companies) | 17.0% | 8.8% | 11.5% | 6.1% | -8.0% |
|---|
| China Resources Power Holdings Co Ltd ($836) | | 2.8% | 11.4% | 1.6% | 1.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Power Assets Holdings Ltd ($6) | 60.5% | 60.0% | 63.5% | 85.6% | 99.4% |
| China Power New Energy Development Co Ltd ($735) | 57.1% | 73.3% | 70.8% | 72.0% | |
| HK Electric Investments & HK Electric Investments Ltd ($2638) | 60.5% | 60.1% | 58.6% | 54.0% | 53.7% |
| CGN Power Co Ltd ($1816) | 48.3% | 46.5% | 46.9% | 48.6% | 47.9% |
| Huadian Power International Corp Ltd ($1071) | 8.9% | | | 27.1% | |
| |
|---|
| Median (8 companies) | 48.3% | 46.5% | 52.8% | 37.9% | 53.7% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Power Assets Holdings Ltd ($6) | 64.6% | 66.2% | 68.0% | 2,533.1% | 71.2% |
| Huaneng Renewables Corp Ltd ($958) | 110.2% | 94.0% | 80.5% | 91.3% | 93.1% |
| China Datang Corp Renewable Power Co Ltd ($1798) | 100.2% | 90.5% | 82.8% | 87.0% | |
| HK Electric Investments & HK Electric Investments Ltd ($2638) | 72.8% | 72.6% | 77.6% | 73.3% | 71.7% |
| CGN Power Co Ltd ($1816) | 64.2% | 66.0% | 62.6% | 60.5% | 59.4% |
| |
|---|
| Median (16 companies) | 25.3% | 27.3% | 34.6% | 38.2% | 47.7% |
|---|
| China Resources Power Holdings Co Ltd ($836) | 22.3% | 28.5% | 33.9% | 33.2% | 41.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huaneng Renewables Corp Ltd ($958) | 240.9% | 163.4% | 124.0% | 217.8% | 171.9% |
| China Power New Energy Development Co Ltd ($735) | 21.5% | 82.2% | 80.1% | 119.5% | |
| China Datang Corp Renewable Power Co Ltd ($1798) | 273.4% | 157.1% | 81.7% | 106.3% | |
| CGN Power Co Ltd ($1816) | 78.4% | 47.5% | 57.2% | 94.5% | 50.0% |
| Huadian Fuxin Energy Corp Ltd ($816) | 78.6% | 62.2% | 54.3% | 91.8% | |
| |
|---|
| Median (16 companies) | 24.3% | 29.6% | 25.1% | 16.9% | 16.7% |
|---|
| China Resources Power Holdings Co Ltd ($836) | 20.4% | 16.6% | 33.4% | 34.6% | 23.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Power Assets Holdings Ltd ($6) | 5.4% | 5.5% | 6.1% | 46.5% | 0.7% |
| Huaneng Power International Inc ($902) | 4.0% | 7.3% | 10.3% | 11.3% | |
| Huadian Power International Corp Ltd ($1071) | 2.7% | 5.0% | 8.4% | 10.4% | |
| CLP Holdings Ltd ($2) | 7.8% | 7.0% | 4.8% | 8.5% | 12.8% |
| China Power International Development Ltd ($2380) | 4.0% | 5.7% | 7.5% | 8.0% | |
| |
|---|
| Median (16 companies) | 4.6% | 5.2% | 6.0% | 6.0% | 5.3% |
|---|
| China Resources Power Holdings Co Ltd ($836) | 5.9% | 7.7% | 9.7% | 8.0% | 11.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Datang Corp Renewable Power Co Ltd ($1798) | 8.1x | 9.1x | 8.2x | 8.7x | |
| CGN Power Co Ltd ($1816) | 4.7x | 6.5x | 6.7x | 7.8x | 8.4x |
| Amber Energy Ltd ($90) | 3.0x | 5.8x | 6.4x | 7.3x | 5.2x |
| Huaneng Renewables Corp Ltd ($958) | 6.0x | 7.7x | 6.6x | 7.3x | 7.1x |
| Huadian Fuxin Energy Corp Ltd ($816) | 9.3x | 6.9x | 6.2x | 6.5x | |
| |
|---|
| Median (15 companies) | 5.9x | 5.8x | 5.6x | 5.1x | 5.2x |
|---|
| China Resources Power Holdings Co Ltd ($836) | 5.9x | 4.4x | 3.7x | 3.9x | 2.7x |
