Regal Real Estate Investment Trust Net Income dropped on 741% in 2015 and EBITDA Margin dropped on 175 pp from 56.7% to -118%
22/03/2016 • About Regal Real Estate Investment Trust (
$1881) • By InTwits
Regal Real Estate Investment Trust reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Regal Real Estate Investment Trust doesn't have a profitable business model yet: 2015 ROIC is -5.2%
- EBITDA Margin is declining: -118.2% in 2015 vs. 56.7% in 2014 vs. 437.8% in 2011
- EBITDA Margin is quite volatile: -118.2% in 2015, 56.7% in 2014, 73.8% in 2013, 447.8% in 2012, 437.8% in 2011
- Regal Real Estate Investment Trust has high CAPEX intensity: 5 year average CAPEX/Revenue was 74.3%. At the same time it's a lot of higher than industry average of 26.1%.
- CAPEX is quite volatile: 101 in 2015, 3,315 in 2014, 179 in 2013, 70.0 in 2012, 85.7 in 2011
- The company has unprofitable business model: ROIC is at -5.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Regal Real Estate Investment Trust ($1881) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 743 | 845 | 904 | 1,029 | 1,002 | -2.7% |
| EBITDA | 3,255 | 3,783 | 668 | 584 | -1,184 | -302.7% |
| Net Income | 2,997 | 3,549 | 343 | 238 | -1,528 | -740.7% |
Balance Sheet
|
|---|
| Cash | 24 | 25 | 48 | 59 | 37 | -37.0% |
| Short Term Debt | 4,563 | 5 | 155 | 63 | 70 | 11.1% |
| Long Term Debt | 209 | 4,776 | 6,685 | 8,097 | 8,116 | 0.2% |
Cash flow
|
|---|
| Capex | 86 | 70 | 179 | 3,315 | 101 | -96.9% |
Ratios
|
|---|
| Revenue growth | -18.3% | 13.6% | 7.0% | 13.8% | -2.7% | |
| EBITDA growth | | 16.2% | -82.4% | -12.5% | -302.7% | |
| EBITDA Margin | 437.8% | 447.8% | 73.8% | 56.7% | -118.2% | -175.0% |
| Net Income Margin | 403.2% | 420.1% | 37.9% | 23.2% | -152.5% | -175.7% |
| CAPEX, % of revenue | 11.5% | 8.3% | 19.8% | 322.0% | 10.1% | -311.9% |
| ROIC | 19.9% | 19.4% | 3.0% | 2.4% | -5.2% | -7.6% |
| ROE | 26.6% | 24.8% | 2.2% | 1.5% | -10.6% | -12.1% |
| Net Debt/EBITDA | 1.5x | 1.3x | 10.2x | 13.9x | | -13.9x |
Revenue and profitability
Regal Real Estate Investment Trust's Revenue decreased on 2.7% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 175 pp from 56.7% to -118% in 2015.
Net Income marign dropped on 176 pp from 23.2% to -153% in 2015.
Capital expenditures (CAPEX) and working capital investments
Regal Real Estate Investment Trust's CAPEX/Revenue was 10.1% in 2015. Regal Real Estate Investment Trust's CAPEX/Revenue increased slightly on 1.8 pp from 8.3% in 2012 to 10.1% in 2015. Average CAPEX/Revenue for the last three years was 117%.
Return on investment
The company operates at negative ROIC (-5.16%) and ROE (-10.58%). ROIC decreased on 7.6 pp from 2.4% to -5.2% in 2015. ROE dropped on 12.1 pp from 1.5% to -10.6% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -4.8x and Debt / EBITDA is . Net Debt / EBITDA dropped on 13.9x from 13.9x to in 2015. Debt showed almost no change in 2015 while cash dropped on 37.0% in 2015.
Appendix 1: Peers in REITS
Below you can find Regal Real Estate Investment Trust benchmarking vs. other companies in REITS 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 |
|---|
| Fortune Real Estate Investment Trust ($778) | | 22.1% | 28.6% | 15.6% | 13.7% |
| Sunlight Real Estate Investment Trust ($435) | | 9.2% | 8.3% | 9.3% | 9.5% |
| Yuexiu Real Estate Investment Trust ($405) | | 36.4% | 92.5% | 14.6% | 8.8% |
| Prosperity REIT ($808) | | 10.8% | 10.8% | 18.0% | 8.8% |
| Link REIT/The ($823) | | 10.8% | 9.7% | 10.0% | 7.9% |
| |
|---|
| Median (7 companies) | 12.5% | 10.8% | 10.3% | 12.3% | 8.8% |
|---|
| Regal Real Estate Investment Trust ($1881) | | 13.6% | 7.0% | 13.8% | -2.7% |
Top companies by EBITDA margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Link REIT/The ($823) | 304.6% | 179.0% | 340.1% | 257.8% | 362.0% |
| Sunlight Real Estate Investment Trust ($435) | 343.7% | 202.4% | 293.6% | 203.4% | 275.0% |
| Yuexiu Real Estate Investment Trust ($405) | 59.2% | 56.0% | 50.4% | 50.7% | 46.9% |
| |
|---|
| Median (3 companies) | 304.6% | 117.5% | 50.4% | 142.9% | 275.0% |
|---|
| Regal Real Estate Investment Trust ($1881) | 437.8% | 447.8% | 73.8% | 56.7% | -118.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Link REIT/The ($823) | 13.5% | 43.9% | 13.4% | 14.0% | 107.2% |
| Fortune Real Estate Investment Trust ($778) | 4.8% | 180.5% | 400.4% | 9.4% | 99.9% |
| Sunlight Real Estate Investment Trust ($435) | 1.2% | 1.4% | 0.7% | 5.1% | 3.1% |
| Prosperity REIT ($808) | 4.6% | 4.3% | 4.5% | 6.4% | 3.0% |
| Yuexiu Real Estate Investment Trust ($405) | 2.3% | 1.8% | 0.6% | 1.4% | 2.9% |
| |
|---|
| Median (7 companies) | 1.8% | 1.6% | 3.5% | 5.4% | 3.0% |
|---|
| Regal Real Estate Investment Trust ($1881) | 11.5% | 8.3% | 19.8% | 322.0% | 10.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Link REIT/The ($823) | 27.2% | 14.8% | 25.5% | 17.7% | 22.3% |
| Sunlight Real Estate Investment Trust ($435) | 15.7% | 9.2% | 13.3% | 9.2% | 12.6% |
| Fortune Real Estate Investment Trust ($778) | 24.2% | 13.6% | 16.0% | 14.0% | 8.6% |
| Champion REIT ($2778) | 11.5% | 8.9% | 4.0% | 4.0% | 6.2% |
| Spring Real Estate Investment Trust ($1426) | 3.6% | 3.4% | 3.7% | 3.8% | 3.9% |
| |
|---|
| Median (7 companies) | 7.9% | 6.5% | 3.7% | 4.0% | 6.2% |
|---|
| Regal Real Estate Investment Trust ($1881) | 19.9% | 19.4% | 3.0% | 2.4% | -5.2% |
Top companies by Net Debt / EBITDA
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Yuexiu Real Estate Investment Trust ($405) | 4.7x | 19.0x | 10.4x | 8.9x | 12.8x |
| New Century Real Estate Investment Trust ($1275) | 5.4x | 4.3x | 6.5x | 6.1x | |
| Sunlight Real Estate Investment Trust ($435) | 2.2x | 3.3x | 2.1x | 2.7x | 1.9x |
| Link REIT/The ($823) | 0.6x | 1.2x | 0.5x | 0.6x | 0.6x |
| |
|---|
| Median (4 companies) | 2.2x | 3.8x | 4.3x | 4.4x | 1.9x |
|---|
| Regal Real Estate Investment Trust ($1881) | 1.5x | 1.3x | 10.2x | 13.9x | |
