Eagle Legend Asia Ltd CAPEX jumped on 130% in 2015 while Revenue dropped on 21.5%
21/03/2016 • About Eagle Legend Asia Ltd (
$936) • By InTwits
Eagle Legend Asia Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Eagle Legend Asia Ltd doesn't have a profitable business model yet: 2015 ROIC is -3.1%
- Eagle Legend Asia Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.4%. At the same time it's a lot of higher than industry average of 8.7%.
- CAPEX is quite volatile: 15.2 in 2015, 6.6 in 2014, 14.9 in 2013, 34.9 in 2012, 40.4 in 2011
- The company has unprofitable business model: ROIC is at -3.1%
- It operates with high leverage: Net Debt/EBITDA is 6.2x while industry average is -21.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Eagle Legend Asia Ltd ($936) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 154.1 | 201.1 | 291.0 | 305.3 | 239.8 | -21.5% |
| Gross Profit | 74.9 | 105.5 | 135.3 | 138.3 | 94.4 | -31.8% |
| SG&A | | 58.3 | 68.1 | 81.1 | 69.2 | -14.7% |
| EBITDA | 33.7 | 48.7 | 63.4 | 69.2 | 31.4 | -54.7% |
| Net Income | -1.1 | -1.7 | 9.3 | -11.1 | -42.0 | 279.4% |
Balance Sheet
|
|---|
| Cash | 25.2 | 125.7 | 149.1 | 111.6 | 84.3 | -24.4% |
| Short Term Debt | 69.5 | 88.3 | 264.9 | 123.4 | 203.3 | 64.8% |
| Long Term Debt | 101.1 | 231.2 | 134.6 | 215.6 | 74.2 | -65.6% |
Cash flow
|
|---|
| Capex | 40.4 | 34.9 | 14.9 | 6.6 | 15.2 | 130.4% |
Ratios
|
|---|
| Revenue growth | 10.6% | 30.5% | 44.7% | 4.9% | -21.5% | |
| EBITDA growth | 48.5% | 44.5% | 30.0% | 9.3% | -54.7% | |
| Gross Margin | 48.6% | 52.5% | 46.5% | 45.3% | 39.4% | -6.0% |
| EBITDA Margin | 21.9% | 24.2% | 21.8% | 22.7% | 13.1% | -9.6% |
| Net Income Margin | -0.7% | -0.8% | 3.2% | -3.6% | -17.5% | -13.9% |
| SG&A, % of revenue | | 29.0% | 23.4% | 26.6% | 28.9% | 2.3% |
| CAPEX, % of revenue | 26.2% | 17.3% | 5.1% | 2.2% | 6.3% | 4.2% |
| ROIC | 0.2% | 2.0% | 3.0% | 3.2% | -3.1% | -6.3% |
| ROE | -0.6% | -0.9% | 4.6% | -5.6% | -25.3% | -19.7% |
| Net Debt/EBITDA | 4.3x | 4.0x | 4.0x | 3.3x | 6.2x | 2.9x |
Revenue and profitability
Eagle Legend Asia Ltd's Revenue dropped on 21.5% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 9.6 pp from 22.7% to 13.1% in 2015.
Gross Margin decreased on 6.0 pp from 45.3% to 39.4% in 2015. SG&A as a % of Revenue increased on 2.3 pp from 26.6% to 28.9% in 2015.
Net Income marign dropped on 13.9 pp from -3.6% to -17.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 6.3%. CAPEX/Revenue dropped on 11.0 pp from 17.3% in 2012 to 6.3% in 2015. Average CAPEX/Revenue for the last three years was 4.5%.
Return on investment
The company operates at negative ROIC (-3.08%) and ROE (-25.33%). ROIC decreased on 6.3 pp from 3.2% to -3.1% in 2015. ROE dropped on 19.7 pp from -5.6% to -25.3% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 6.2x and Debt / EBITDA is 8.8x. Net Debt / EBITDA jumped on 2.9x from 3.3x to 6.2x in 2015. Debt dropped on 18.1% in 2015 while cash dropped on 24.4% in 2015.
Appendix 1: Peers in Commercial Services
Below we provide Eagle Legend Asia Ltd benchmarking against other companies in Commercial 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 |
|---|
| Global Energy Resources International Group Ltd ($8192) | 429.3% | -61.9% | -27.8% | 2,912.9% | |
| Dingyi Group Investment Ltd ($508) | | 8.8% | -95.9% | 1,361.2% | -32.6% |
| China Smartpay Group Holdings Ltd ($8325) | | 60.0% | 274.7% | 75.6% | 124.5% |
| Goldpac Group Ltd ($3315) | | 52.3% | 64.4% | 36.8% | 10.8% |
| Wonderful Sky Financial Group Holdings Ltd ($1260) | | 21.3% | 4.5% | 33.5% | 14.2% |
| |
|---|
| Median (60 companies) | 21.4% | 8.0% | 4.7% | 9.4% | 6.7% |
|---|
| Eagle Legend Asia Ltd ($936) | | 30.5% | 44.7% | 4.9% | -21.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HC International Inc ($2280) | 84.7% | 87.5% | 91.9% | 92.5% | |
| Fu Shou Yuan International Group Ltd ($1448) | 81.6% | 80.5% | 80.4% | 80.0% | 77.6% |
| China Communication Telecom Services Co Ltd ($8206) | -56.6% | 61.6% | 58.6% | 69.1% | 70.2% |
| Dingyi Group Investment Ltd ($508) | 76.5% | 75.8% | | 64.5% | 86.0% |
| Yuexiu Transport Infrastructure Ltd ($1052) | 67.1% | 66.2% | 66.8% | 62.8% | 65.2% |
| |
|---|
| Median (56 companies) | 32.9% | 31.0% | 29.2% | 30.8% | 28.6% |
|---|
| Eagle Legend Asia Ltd ($936) | 48.6% | 52.5% | 46.5% | 45.3% | 39.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shenzhen International Holdings Ltd ($152) | 69.3% | 60.2% | 65.8% | 97.1% | |
| Shenzhen Expressway Co Ltd ($548) | 80.4% | 74.3% | 79.4% | 76.6% | 53.0% |
| Yuexiu Transport Infrastructure Ltd ($1052) | 74.3% | 78.3% | 74.5% | 74.0% | 71.6% |
| Anhui Expressway Co Ltd ($995) | 62.7% | 56.9% | 54.1% | 60.4% | |
| Dragon Crown Group Holdings Ltd ($935) | 57.8% | 67.3% | 62.9% | 60.2% | |
| |
|---|
| Median (60 companies) | 16.4% | 16.0% | 13.4% | 10.9% | 5.4% |
|---|
| Eagle Legend Asia Ltd ($936) | 21.9% | 24.2% | 21.8% | 22.7% | 13.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Kai Yuan Holdings Ltd ($1215) | 16.8% | 3.9% | 7.0% | 59.8% | |
| COSCO Pacific Ltd ($1199) | 111.3% | 96.6% | 66.6% | 43.3% | |
| Finet Group Ltd ($8317) | 3.9% | 10.3% | 9.1% | 26.0% | 8.4% |
| HC International Inc ($2280) | 15.1% | 8.5% | 28.7% | 24.7% | |
| Dragon Crown Group Holdings Ltd ($935) | 2.5% | 37.2% | 52.0% | 23.0% | |
| |
|---|
| Median (59 companies) | 3.8% | 3.2% | 4.0% | 4.8% | 2.6% |
|---|
| Eagle Legend Asia Ltd ($936) | 26.2% | 17.3% | 5.1% | 2.2% | 6.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mega Expo Holdings Ltd ($1360) | | 270.5% | 481.1% | 54.4% | 10.1% |
| China Packaging Holdings Development Ltd ($1439) | 50.0% | 52.0% | 46.6% | 34.1% | |
| Wonderful Sky Financial Group Holdings Ltd ($1260) | 136.8% | 51.5% | 26.6% | 30.0% | 29.5% |
| PPS International Holdings Ltd ($8201) | | 101.6% | 35.6% | 23.8% | -13.7% |
| 1010 Printing Group Ltd ($1127) | 14.4% | 13.5% | 20.8% | 17.8% | 19.9% |
| |
|---|
| Median (60 companies) | 5.2% | 6.0% | 5.2% | 4.2% | 5.8% |
|---|
| Eagle Legend Asia Ltd ($936) | 0.2% | 2.0% | 3.0% | 3.2% | -3.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dalian Port PDA Co Ltd ($2880) | 5.7x | 5.7x | 4.8x | 4.7x | |
| Sichuan Expressway Co Ltd ($107) | 1.8x | 2.7x | 3.8x | 4.3x | |
| Anxian Yuan China Holdings Ltd ($922) | | | 4.6x | 3.8x | 0.8x |
| Yuexiu Transport Infrastructure Ltd ($1052) | 2.9x | 4.5x | 3.1x | 2.7x | 5.3x |
| Jiangsu Expressway Co Ltd ($177) | 1.1x | 1.2x | 1.1x | 2.7x | |
| |
|---|
| Median (39 companies) | -0.1x | -0.1x | -0.8x | -1.0x | -2.0x |
|---|
| Eagle Legend Asia Ltd ($936) | 4.3x | 4.0x | 4.0x | 3.3x | 6.2x |
