United Laboratories International Holdings Ltd/The Net Income dropped on 83.8% in 2015 and Revenue decreased on 4.2%
22/03/2016 • About United Laboratories International Holdings Ltd/The (
$3933) • By InTwits
United Laboratories International Holdings Ltd/The reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- United Laboratories International Holdings Ltd/The has high CAPEX intensity: 5 year average CAPEX/Revenue was 20.6%. At the same time it's a lot of higher than industry average of 8.9%.
- CAPEX is quite volatile: 723 in 2015, 692 in 2014, 2,046 in 2013, 2,777 in 2012, 1,195 in 2011
- The company has potentially unprofitable business model: ROIC is at 4.2%
- It operates with high leverage: Net Debt/EBITDA is 4.0x while industry average is 0.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
United Laboratories International Holdings Ltd/The ($3933) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 6,405 | 7,022 | 7,648 | 8,030 | 7,695 | -4.2% |
| Gross Profit | 1,829 | 2,117 | 2,638 | 3,228 | 2,961 | -8.3% |
| SG&A | 1,486 | 1,672 | 1,787 | 1,971 | 2,024 | 2.7% |
| EBITDA | 767 | 985 | 1,639 | 1,723 | 1,458 | -15.4% |
| Net Income | 104 | 162 | 48 | 681 | 110 | -83.8% |
Balance Sheet
|
|---|
| Cash | 949 | 646 | 1,081 | 1,003 | 1,115 | 11.1% |
| Short Term Debt | 3,352 | 6,044 | 6,446 | 6,036 | 5,549 | -8.1% |
| Long Term Debt | 943 | 1,023 | 2,165 | 2,163 | 1,420 | -34.4% |
Cash flow
|
|---|
| Capex | 1,195 | 2,777 | 2,046 | 692 | 723 | 4.5% |
Ratios
|
|---|
| Revenue growth | -1.5% | 9.6% | 8.9% | 5.0% | -4.2% | |
| EBITDA growth | -53.6% | 28.4% | 66.5% | 5.1% | -15.4% | |
| Gross Margin | 28.6% | 30.2% | 34.5% | 40.2% | 38.5% | -1.7% |
| EBITDA Margin | 12.0% | 14.0% | 21.4% | 21.5% | 19.0% | -2.5% |
| Net Income Margin | 1.6% | 2.3% | 0.6% | 8.5% | 1.4% | -7.0% |
| SG&A, % of revenue | 23.2% | 23.8% | 23.4% | 24.5% | 26.3% | 1.8% |
| CAPEX, % of revenue | 18.7% | 39.6% | 26.8% | 8.6% | 9.4% | 0.8% |
| ROIC | 3.5% | 3.9% | 7.3% | 6.3% | 4.2% | -2.1% |
| ROE | 2.0% | 2.9% | 0.8% | 10.1% | 1.6% | -8.5% |
| Net Debt/EBITDA | 4.4x | 6.5x | 4.6x | 4.2x | 4.0x | -0.2x |
Revenue and profitability
United Laboratories International Holdings Ltd/The's Revenue decreased on 4.2% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 2.5 pp from 21.5% to 19.0% in 2015.
Gross Margin decreased slightly on 1.7 pp from 40.2% to 38.5% in 2015. SG&A as a % of Revenue increased slightly on 1.8 pp from 24.5% to 26.3% in 2015.
Net Income marign decreased on 7.0 pp from 8.5% to 1.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
United Laboratories International Holdings Ltd/The's CAPEX/Revenue was 9.4% in 2015. United Laboratories International Holdings Ltd/The's CAPEX/Revenue dropped on 30.2 pp from 39.6% in 2012 to 9.4% in 2015. Average CAPEX/Revenue for the last three years was 14.9%.
Return on investment
The company operates at low ROIC (4.20%) and ROE (1.61%). ROIC decreased on 2.1 pp from 6.3% to 4.2% in 2015. ROE decreased on 8.5 pp from 10.1% to 1.6% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.0x and Debt / EBITDA is 4.8x. Net Debt / EBITDA dropped on 0.2x from 4.2x to 4.0x in 2015. Debt dropped on 15.0% in 2015 while cash jumped on 11.1% in 2015.
Appendix 1: Peers in Pharmaceuticals
Below we provide United Laboratories International Holdings Ltd/The benchmarking against other companies in Pharmaceuticals 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 |
|---|
| Hong Kong Life Sciences and Technology Group Ltd ($8085) | | -10.0% | -45.4% | 1,636.5% | -52.9% |
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | | 15.1% | -99.9% | 480.0% | -93.1% |
| United Gene High-Tech Group Ltd ($399) | | -71.8% | -60.5% | 196.0% | 14.2% |
| China Traditional Chinese Medicine Co Ltd ($570) | | 22.3% | 35.2% | 90.0% | 40.0% |
| Dragonite International Ltd ($329) | -8.8% | -10.5% | 13.5% | 64.8% | |
| |
|---|
| Median (41 companies) | 25.8% | 15.1% | 13.5% | 16.8% | 14.2% |
|---|
| United Laboratories International Holdings Ltd/The ($3933) | | 9.6% | 8.9% | 5.0% | -4.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 83.9% | 82.0% | 81.5% | 80.9% | |
| Consun Pharmaceutical Group Ltd ($1681) | 75.5% | 75.7% | 79.1% | 78.3% | |
| Sino Biopharmaceutical Ltd ($1177) | 78.5% | 78.5% | 77.5% | 76.4% | |
| China Health Group Inc ($8225) | 38.7% | 43.4% | 33.6% | 76.2% | 75.7% |
| Hua Han Bio-Pharmaceutical Holdings Ltd ($587) | 72.6% | 65.2% | 77.9% | 72.1% | 68.7% |
| |
|---|
| Median (39 companies) | 38.3% | 39.2% | 37.8% | 49.1% | 49.9% |
|---|
| United Laboratories International Holdings Ltd/The ($3933) | 28.6% | 30.2% | 34.5% | 40.2% | 38.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Resources Holdings Ltd ($899) | 3.5% | -80.8% | 25.1% | 113.7% | |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 48.4% | 38.8% | 65.4% | 70.9% | |
| Pak Fah Yeow International Ltd ($239) | 28.7% | 33.9% | 28.4% | 52.4% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 29.7% | 41.3% | 45.4% | 47.5% | 49.1% |
| Real Nutriceutical Group Ltd ($2010) | 45.6% | 42.8% | 43.4% | 46.0% | |
| |
|---|
| Median (40 companies) | 17.7% | 20.3% | 19.3% | 21.1% | 21.0% |
|---|
| United Laboratories International Holdings Ltd/The ($3933) | 12.0% | 14.0% | 21.4% | 21.5% | 19.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 0.2% | | 11,100.0% | 103.4% | 0.0% |
| Extrawell Pharmaceutical Holdings Ltd ($858) | 5.7% | 1.7% | 20.6% | 92.4% | 3.6% |
| Asia Resources Holdings Ltd ($899) | 12.2% | 4.4% | 8.1% | 92.0% | |
| Lijun International Pharmaceutical Holding Co Ltd ($2005) | 19.5% | 16.8% | 52.4% | 39.6% | |
| Hao Wen Holdings Ltd ($8019) | 6.4% | 30.0% | 2.3% | 38.2% | |
| |
|---|
| Median (40 companies) | 9.4% | 8.2% | 7.5% | 7.2% | 3.3% |
|---|
| United Laboratories International Holdings Ltd/The ($3933) | 18.7% | 39.6% | 26.8% | 8.6% | 9.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 18.5% | 16.7% | 20.8% | 33.0% | |
| Sino Biopharmaceutical Ltd ($1177) | 19.9% | 26.2% | 26.8% | 26.5% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | | 25.3% | 27.5% | 23.8% | 25.9% |
| Lee's Pharmaceutical Holdings Ltd ($950) | 31.3% | 26.1% | 22.0% | 22.4% | |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 14.3% | 13.7% | 18.3% | 22.0% | |
| |
|---|
| Median (41 companies) | 9.1% | 12.3% | 9.3% | 11.6% | 6.7% |
|---|
| United Laboratories International Holdings Ltd/The ($3933) | 3.5% | 3.9% | 7.3% | 6.3% | 4.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China NT Pharma Group Co Ltd ($1011) | 0.4x | | | 7.2x | |
| Lansen Pharmaceutical Holdings Ltd ($503) | 0.9x | 1.7x | 2.8x | 3.4x | |
| China Grand Pharmaceutical and Healthcare Holdings Ltd ($512) | 2.5x | 5.4x | 4.0x | 3.4x | |
| Shandong Xinhua Pharmaceutical Co Ltd ($719) | 1.4x | 3.5x | 3.4x | 2.8x | |
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | 2.4x | 0.8x | 1.4x | 2.2x | |
| |
|---|
| Median (33 companies) | -0.8x | -0.4x | -0.6x | -0.6x | -1.5x |
|---|
| United Laboratories International Holdings Ltd/The ($3933) | 4.4x | 6.5x | 4.6x | 4.2x | 4.0x |
