Sing Lee Software Group Ltd reports 52.3% EBITDA growth and 3.0 pp EBITDA Margin growth from 9.1% to 12.1%
21/03/2016 • About Sing Lee Software Group Ltd (
$8076) • By InTwits
Sing Lee Software Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sing Lee Software Group Ltd is a fast growth stock: 2015 revenue growth was 14.1%, 5 year revenue CAGR was 29.3% at 2015 ROIC 12.4%
- Sing Lee Software Group 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 -37.8%0
- Sing Lee Software Group Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 7.6%. At the same time it's a lot of higher than industry average of 5.3%.
- CAPEX is quite volatile: 0.64 in 2015, 6.9 in 2014, 0.060 in 2013, 1.2 in 2012, 3.6 in 2011
- The company has highly profitable business model: ROIC is at 12.4%
- It operates with high leverage: Net Debt/EBITDA is 4.4x while industry average is -2.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sing Lee Software Group Ltd ($8076) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 18.840 | 36.080 | 33.364 | 48.908 | 55.819 | 14.1% |
| Gross Profit | 0.586 | 18.103 | 9.810 | 21.516 | 26.596 | 23.6% |
| SG&A | 56.835 | 32.011 | 26.489 | 18.488 | 21.271 | 15.1% |
| EBITDA | -56.784 | -10.876 | -16.423 | 4.447 | 6.772 | 52.3% |
| Net Income | -37.483 | -11.334 | -18.203 | 0.571 | 1.294 | 126.6% |
Balance Sheet
|
|---|
| Cash | 22.085 | 19.147 | 15.233 | 12.217 | 18.901 | 54.7% |
| Short Term Debt | 44.317 | 2.405 | 5.095 | 7.017 | 10.179 | 45.1% |
| Long Term Debt | 24.729 | 32.018 | 27.157 | 32.929 | 38.421 | 16.7% |
Cash flow
|
|---|
| Capex | 3.648 | 1.176 | 0.060 | 6.864 | 0.639 | -90.7% |
Ratios
|
|---|
| Revenue growth | 22.1% | 91.5% | -7.5% | 46.6% | 14.1% | |
| EBITDA growth | 78.3% | -80.8% | 51.0% | -127.1% | 52.3% | |
| Gross Margin | 3.1% | 50.2% | 29.4% | 44.0% | 47.6% | 3.7% |
| EBITDA Margin | -301.4% | -30.1% | -49.2% | 9.1% | 12.1% | 3.0% |
| Net Income Margin | -199.0% | -31.4% | -54.6% | 1.2% | 2.3% | 1.2% |
| SG&A, % of revenue | 301.7% | 88.7% | 79.4% | 37.8% | 38.1% | 0.3% |
| CAPEX, % of revenue | 19.4% | 3.3% | 0.2% | 14.0% | 1.1% | -12.9% |
| ROIC | -97.7% | -18.7% | -50.9% | 10.0% | 12.4% | 2.4% |
| ROE | -231.5% | -205.5% | | | | 0.0% |
| Net Debt/EBITDA | | | | 6.2x | 4.4x | -1.8x |
Revenue and profitability
Sing Lee Software Group Ltd's Revenue jumped on 14.1% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 33.1 pp from -39.0% to -5.9% in FY2015.
Gross Margin increased on 3.7 pp from 44.0% to 47.6% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign increased slightly on 1.2 pp from 1.2% to 2.3% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 1.1% in 2015. CAPEX/Revenue decreased on 2.1 pp from 3.3% in 2012 to 1.1% in 2015. It's average level of CAPEX/Revenue for the last three years was 5.1%.
Leverage (Debt)
Debt level is 4.4x Net Debt / EBITDA and 7.2x Debt / EBITDA. Net Debt / EBITDA dropped on 1.8x from 6.2x to 4.4x in 2015. Debt surged on 21.7% in 2015 while cash jumped on 54.7% in 2015.
Appendix 1: Peers in Software
Below we provide Sing Lee Software Group Ltd benchmarking against other companies in Software 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 |
|---|
| Pizu Group Holdings Ltd ($8053) | | 40.3% | -42.9% | 1,742.9% | 157.9% |
| China City Railway Transportation Technology Holdings Co Ltd ($1522) | 194.6% | 164.0% | 33.6% | 100.5% | |
| China Mobile Games and Cultural Investment Ltd ($8081) | -16.7% | 393.7% | -6.6% | 92.2% | |
| Epicurean and Co Ltd ($8213) | | 177.0% | 185.7% | 62.6% | 22.0% |
| China Bio Cassava Holdings Ltd ($8129) | | -14.2% | 38.8% | 55.1% | -19.7% |
| |
|---|
| Median (33 companies) | 17.0% | 9.5% | 11.2% | 20.6% | 9.2% |
|---|
| Sing Lee Software Group Ltd ($8076) | | 91.5% | -7.5% | 46.6% | 14.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Bio Cassava Holdings Ltd ($8129) | 90.2% | 90.4% | 97.4% | 98.4% | 98.3% |
| Chanjet Information Technology Co Ltd ($1588) | 91.9% | 89.2% | 91.3% | 92.4% | 91.4% |
| NetDragon Websoft Inc ($777) | 90.1% | 93.4% | 90.8% | 89.3% | |
| China Mobile Games and Cultural Investment Ltd ($8081) | 19.4% | 6.5% | 45.3% | 84.8% | |
| Kingdee International Software Group Co Ltd ($268) | 70.1% | 65.0% | 75.3% | 82.5% | 81.5% |
| |
|---|
| Median (32 companies) | 51.0% | 44.3% | 43.1% | 39.7% | 39.2% |
|---|
| Sing Lee Software Group Ltd ($8076) | 3.1% | 50.2% | 29.4% | 44.0% | 47.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sinosoft Technology Group Ltd ($1297) | 55.5% | 62.6% | 54.9% | 57.2% | 59.0% |
| International Entertainment Corp ($1009) | 235.1% | 50.8% | 64.0% | 54.9% | 62.0% |
| China Binary Sale Technology Ltd ($8255) | 41.3% | 35.1% | 35.4% | 44.4% | 50.5% |
| Microsoft Corp ($4338) | 42.8% | 33.5% | 39.2% | 38.0% | 25.8% |
| Kingdee International Software Group Co Ltd ($268) | 19.5% | 7.8% | 33.2% | 37.2% | 31.9% |
| |
|---|
| Median (33 companies) | 12.0% | 9.8% | 11.1% | 8.8% | 5.7% |
|---|
| Sing Lee Software Group Ltd ($8076) | -301.4% | -30.1% | -49.2% | 9.1% | 12.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| NetDragon Websoft Inc ($777) | 13.3% | 21.1% | 34.6% | 54.6% | |
| China Eco-Farming Ltd ($8166) | 0.3% | 0.6% | 0.7% | 18.1% | |
| TravelSky Technology Ltd ($696) | 5.8% | 8.9% | 21.7% | 18.1% | |
| Kingsoft Corp Ltd ($3888) | 6.8% | 4.3% | 3.8% | 14.3% | |
| Epicurean and Co Ltd ($8213) | 18.7% | 25.3% | 10.4% | 10.3% | 5.5% |
| |
|---|
| Median (32 companies) | 2.0% | 1.3% | 2.5% | 3.5% | 1.4% |
|---|
| Sing Lee Software Group Ltd ($8076) | 19.4% | 3.3% | 0.2% | 14.0% | 1.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Binary Sale Technology Ltd ($8255) | | 27.7% | 26.9% | 28.4% | 19.0% |
| Microsoft Corp ($4338) | 43.4% | 28.6% | 30.3% | 26.2% | 15.6% |
| Finsoft Corp ($8018) | | 140.5% | 4.6% | 25.0% | -5.6% |
| Sinosoft Technology Group Ltd ($1297) | 31.6% | 34.0% | 21.9% | 20.2% | 20.8% |
| Boyaa Interactive International Ltd ($434) | 100.4% | 75.3% | 21.3% | 20.0% | |
| |
|---|
| Median (33 companies) | 4.9% | 5.2% | 5.8% | 1.2% | 2.0% |
|---|
| Sing Lee Software Group Ltd ($8076) | -97.7% | -18.7% | -50.9% | 10.0% | 12.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pizu Group Holdings Ltd ($8053) | | | | 346.1x | -0.4x |
| Epicurean and Co Ltd ($8213) | 2.9x | 2.3x | 4.7x | 12.3x | 12.0x |
| China Technology Solar Power Holdings Ltd ($8111) | | | 7.4x | 3.3x | 0.2x |
| Chinasoft International Ltd ($354) | -1.3x | -0.7x | 0.7x | 1.5x | 0.7x |
| Kingdee International Software Group Co Ltd ($268) | -0.1x | 5.0x | 1.1x | 0.5x | -1.2x |
| |
|---|
| Median (21 companies) | -1.0x | -1.1x | -1.7x | -2.3x | -0.4x |
|---|
| Sing Lee Software Group Ltd ($8076) | | | | 6.2x | 4.4x |
