China Coal Energy Co Ltd Net Debt / EBITDA surged on 4.7x from 9.7x to 14.4x in 2015 and Debt surged on 19.3%
22/03/2016 • About China Coal Energy Co Ltd (
$1898) • By InTwits
China Coal Energy Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Coal Energy Co Ltd is a company in decline: 2015 revenue growth was -16.1%, 5 years revenue CAGR was -3.4%
- China Coal Energy Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 26.3%. At the same time it's in pair with industry average of 11.7%.
- CAPEX is quite volatile: 4,051 in 2015, 2,680 in 2014, 6,411 in 2013, 8,128 in 2012, 4,306 in 2011
- The company has potentially unprofitable business model: ROIC is at 0.0%
- It operates with high leverage: Net Debt/EBITDA is 14.4x while industry average is 5.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Coal Energy Co Ltd ($1898) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 90,865 | 87,292 | 82,316 | 70,664 | 59,271 | -16.1% |
| Gross Profit | 18,813 | 17,303 | 11,396 | 7,196 | 4,104 | -43.0% |
| SG&A | 4,499 | 4,275 | 4,213 | 4,338 | 3,775 | -13.0% |
| EBITDA | 18,951 | 17,499 | 12,081 | 7,929 | 7,079 | -10.7% |
| Net Income | 9,955 | 8,842 | 3,805 | 141 | -3,267 | -2,415.3% |
Balance Sheet
|
|---|
| Cash | 20,907 | 13,223 | 11,233 | 18,132 | 11,196 | -38.3% |
| Short Term Debt | 3,062 | 6,541 | 10,320 | 12,837 | 32,650 | 154.3% |
| Long Term Debt | 26,411 | 40,077 | 59,643 | 81,871 | 80,376 | -1.8% |
Cash flow
|
|---|
| Capex | 20,019 | 27,560 | 25,375 | 19,695 | 11,441 | -41.9% |
Ratios
|
|---|
| Revenue growth | 29.2% | -3.9% | -5.7% | -14.2% | -16.1% | |
| EBITDA growth | 29.9% | -7.7% | -31.0% | -34.4% | -10.7% | |
| Gross Margin | 20.7% | 19.8% | 13.8% | 10.2% | 6.9% | -3.3% |
| EBITDA Margin | 20.9% | 20.0% | 14.7% | 11.2% | 11.9% | 0.7% |
| Net Income Margin | 11.0% | 10.1% | 4.6% | 0.2% | -5.5% | -5.7% |
| SG&A, % of revenue | 5.0% | 4.9% | 5.1% | 6.1% | 6.4% | 0.2% |
| CAPEX, % of revenue | 22.0% | 31.6% | 30.8% | 27.9% | 19.3% | -8.6% |
| ROIC | 11.7% | 8.7% | 4.0% | 1.3% | 0.0% | -1.3% |
| ROE | 12.7% | 10.4% | 4.4% | 0.2% | -3.8% | -4.0% |
| Net Debt/EBITDA | 0.5x | 1.9x | 4.9x | 9.7x | 14.4x | 4.7x |
Revenue and profitability
China Coal Energy Co Ltd's Revenue dropped on 16.1% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.72 pp from 11.2% to 11.9% in 2015.
Gross Margin decreased on 3.3 pp from 10.2% to 6.9% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign decreased on 5.7 pp from 0.20% to -5.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 19.3%. The company's CAPEX/Revenue dropped on 12.3 pp from 31.6% in 2012 to 19.3% in 2015. It's average level of CAPEX/Revenue for the last three years was 26.0%.Battling declining revenue China Coal Energy Co Ltd made large investments to CAPEX (162% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at low but positive ROIC (0.02%) and negative ROE (-3.83%). ROIC decreased slightly on 1.3 pp from 1.3% to 0.020% in 2015. ROE decreased on 4.0 pp from 0.16% to -3.8% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 14.4x and Debt / EBITDA is 16.0x. Net Debt / EBITDA jumped on 4.7x from 9.7x to 14.4x in 2015. Debt jumped on 19.3% in 2015 while cash dropped on 38.3% in 2015.
Appendix 1: Peers in Coal
Below you can find China Coal Energy Co Ltd benchmarking vs. other companies in Coal 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 |
|---|
| Kinetic Mines and Energy Ltd ($1277) | | | 299.9% | 563.4% | 40.0% |
| Feishang Anthracite Resources Ltd ($1738) | 172.1% | 34.9% | 25.8% | 103.6% | |
| Loudong General Nice Resources China Holdings Ltd ($988) | 8.5% | -12.7% | 39.1% | 87.6% | |
| Rosan Resources Holdings Ltd ($578) | -19.9% | -74.1% | 71.1% | 49.1% | |
| Asia Coal Ltd ($835) | | 32.1% | -15.3% | 43.2% | 133.6% |
| |
|---|
| Median (22 companies) | 21.3% | -1.2% | -8.6% | -8.2% | 40.0% |
|---|
| China Coal Energy Co Ltd ($1898) | | -3.9% | -5.7% | -14.2% | -16.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Coal Ltd ($835) | 32.4% | 56.7% | 62.6% | 76.7% | 5.8% |
| Shougang Fushan Resources Group Ltd ($639) | 70.4% | 63.5% | 50.9% | 40.1% | |
| Agritrade Resources Ltd ($1131) | 7.6% | 22.9% | 29.4% | 31.8% | 30.0% |
| Kinetic Mines and Energy Ltd ($1277) | | 20.6% | 28.8% | 30.3% | 10.9% |
| China Shenhua Energy Co Ltd ($1088) | 39.9% | 31.4% | 28.7% | 29.6% | |
| |
|---|
| Median (22 companies) | 31.5% | 20.3% | 17.6% | 9.7% | 5.8% |
|---|
| China Coal Energy Co Ltd ($1898) | 20.7% | 19.8% | 13.8% | 10.2% | 6.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Shenhua Energy Co Ltd ($1088) | 41.2% | 35.6% | 31.6% | 34.2% | |
| Agritrade Resources Ltd ($1131) | 1.4% | 41.6% | 37.3% | 33.4% | 31.1% |
| Kinetic Mines and Energy Ltd ($1277) | | -277.0% | -51.9% | 29.3% | 15.8% |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 40.9% | 33.1% | 30.7% | 22.8% | |
| Feishang Anthracite Resources Ltd ($1738) | -9.2% | -13.1% | -32.9% | 19.0% | |
| |
|---|
| Median (23 companies) | 11.1% | -1.1% | -4.3% | -8.6% | -19.6% |
|---|
| China Coal Energy Co Ltd ($1898) | 20.9% | 20.0% | 14.7% | 11.2% | 11.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Up Energy Development Group Ltd ($307) | | | | 279.5% | 75.2% |
| Siberian Mining Group Co Ltd ($1142) | 129.1% | 4.6% | 78.8% | 217.3% | 279.7% |
| King Stone Energy Group Ltd ($663) | 82.7% | 58.5% | 135.3% | 205.7% | |
| Asia Coal Ltd ($835) | 121.4% | 12.5% | 25.8% | 111.0% | 0.3% |
| Hidili Industry International Development Ltd ($1393) | 74.1% | 82.3% | 144.6% | 92.3% | |
| |
|---|
| Median (23 companies) | 22.0% | 13.7% | 23.0% | 17.8% | 16.9% |
|---|
| China Coal Energy Co Ltd ($1898) | 22.0% | 31.6% | 30.8% | 27.9% | 19.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Shenhua Energy Co Ltd ($1088) | 21.0% | 19.5% | 17.4% | 14.6% | |
| Loudong General Nice Resources China Holdings Ltd ($988) | 11.5% | 4.1% | 8.2% | 9.6% | |
| Kinetic Mines and Energy Ltd ($1277) | -2.6% | -6.6% | -5.7% | 8.5% | 3.2% |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 37.6% | 28.5% | 15.2% | 8.5% | |
| Agritrade Resources Ltd ($1131) | -2.3% | 2.7% | 5.8% | 6.4% | 6.9% |
| |
|---|
| Median (23 companies) | 0.6% | -2.6% | -2.1% | -5.2% | -0.9% |
|---|
| China Coal Energy Co Ltd ($1898) | 11.7% | 8.7% | 4.0% | 1.3% | 0.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Feishang Anthracite Resources Ltd ($1738) | | | | 24.3x | |
| Loudong General Nice Resources China Holdings Ltd ($988) | 2.0x | 5.8x | 4.4x | 6.0x | |
| Yanzhou Coal Mining Co Ltd ($1171) | 1.1x | 2.9x | 6.2x | 4.9x | |
| Kinetic Mines and Energy Ltd ($1277) | | | | 4.5x | 5.9x |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 0.4x | 0.4x | 1.7x | 3.5x | |
| |
|---|
| Median (8 companies) | 1.6x | 2.9x | 3.1x | 4.0x | 2.0x |
|---|
| China Coal Energy Co Ltd ($1898) | 0.5x | 1.9x | 4.9x | 9.7x | 14.4x |
