AAC Technologies Holdings Inc reports 34.1% Net Income growth and almost no change in EBITDA Margin of 34.8%
23/03/2016 • About AAC Technologies Holdings Inc (
$2018) • By InTwits
AAC Technologies Holdings Inc reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- AAC Technologies Holdings Inc is a fast growth stock: 2015 revenue growth was 32.2%, 5 year revenue CAGR was 28.5% at 2015 ROIC 27.8%
- EBITDA Margin is relatively stable: 34.8% in 2015 vs. 34.9% in 2014 vs. 35.2% in 2011
- AAC Technologies Holdings Inc has high CAPEX intensity: 5 year average CAPEX/Revenue was 18.3%. At the same time it's a lot of higher than industry average of 13.7%.
- CAPEX is quite volatile: 2,164 in 2015, 1,739 in 2014, 707 in 2013, 1,176 in 2012, 1,053 in 2011
- The company has highly profitable business model: ROIC is at 27.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
AAC Technologies Holdings Inc ($2018) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 4,060 | 6,283 | 8,096 | 8,879 | 11,739 | 32.2% |
| Gross Profit | 1,784 | 2,774 | 3,459 | 3,678 | 4,872 | 32.5% |
| SG&A | 290 | 464 | 530 | 537 | 803 | 49.7% |
| EBITDA | 1,430 | 2,249 | 2,900 | 3,101 | 4,083 | 31.7% |
| Net Income | 1,036 | 1,763 | 2,578 | 2,318 | 3,107 | 34.1% |
Balance Sheet
|
|---|
| Cash | 1,374 | 1,314 | 2,354 | 1,603 | 2,224 | 38.8% |
| Short Term Debt | 891 | 1,035 | 908 | 1,418 | 1,159 | -18.3% |
| Long Term Debt | 0 | 0 | 14 | 11 | 649 | 5,713.8% |
Cash flow
|
|---|
| Capex | 1,053 | 1,176 | 707 | 1,739 | 2,164 | 24.4% |
Ratios
|
|---|
| Revenue growth | 21.2% | 54.8% | 28.9% | 9.7% | 32.2% | |
| EBITDA growth | 11.7% | 57.2% | 29.0% | 6.9% | 31.7% | |
| Gross Margin | 44.0% | 44.2% | 42.7% | 41.4% | 41.5% | 0.1% |
| EBITDA Margin | 35.2% | 35.8% | 35.8% | 34.9% | 34.8% | -0.1% |
| Net Income Margin | 25.5% | 28.1% | 31.8% | 26.1% | 26.5% | 0.4% |
| SG&A, % of revenue | 7.2% | 7.4% | 6.6% | 6.0% | 6.8% | 0.8% |
| CAPEX, % of revenue | 25.9% | 18.7% | 8.7% | 19.6% | 18.4% | -1.1% |
| ROIC | 22.3% | 29.1% | 30.0% | 26.0% | 27.8% | 1.9% |
| ROE | 23.2% | 32.6% | 36.9% | 27.2% | 30.4% | 3.1% |
| Net Debt/EBITDA | -0.3x | -0.1x | -0.5x | -0.1x | -0.1x | -0.0x |
Revenue and profitability
AAC Technologies Holdings Inc's Revenue surged on 32.2% in 2015. EBITDA Margin showed almost no change in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue increased slightly on 0.80 pp from 6.0% to 6.8% in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 18.4%. CAPEX/Revenue showed almost no change from 2012 to 2015. Average CAPEX/Revenue for the last three years was 15.6%.To deliver this fast growth the company invested a large share of EBITDA (53.0%) to CAPEX.
Return on investment
The company operates at high and attractive ROIC (27.84%) and ROE (30.39%). ROIC increased slightly on 1.9 pp from 26.0% to 27.8% in 2015. ROE increased on 3.1 pp from 27.2% to 30.4% in 2015.
Leverage (Debt)
Debt level is -0.1x Net Debt / EBITDA and 0.4x Debt / EBITDA. Net Debt / EBITDA decreased on 0.046x from -0.1x to -0.1x in 2015. Debt jumped on 26.5% in 2015 while cash surged on 38.8% in 2015.
Management team
AAC Technologies Holdings Inc's CEO is Pan Zhengmin "Benjamin". Pan Zhengmin "Benjamin" has 25 years tenure at the company.
Appendix 1: Peers in Electronics
Below we provide AAC Technologies Holdings Inc benchmarking against other companies in Electronics 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 |
|---|
| China Netcom Technology Holdings Ltd ($8071) | -22.0% | 11.6% | -23.0% | 104.1% | |
| Technovator International Ltd ($1206) | | 27.4% | 34.1% | 35.9% | 19.0% |
| Tongda Group Holdings Ltd ($698) | | 8.3% | 6.4% | 32.1% | 26.8% |
| Advanced Card Systems Holdings Ltd ($8210) | | 36.9% | 20.8% | 26.7% | -4.8% |
| Alltronics Holdings Ltd ($833) | 33.9% | -1.6% | -1.6% | 23.4% | |
| |
|---|
| Median (49 companies) | 6.9% | -1.6% | 3.1% | 3.8% | 0.4% |
|---|
| AAC Technologies Holdings Inc ($2018) | | 54.8% | 28.9% | 9.7% | 32.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Advanced Card Systems Holdings Ltd ($8210) | 51.4% | 54.0% | 58.1% | 49.5% | 49.6% |
| TeleEye Holdings Ltd ($8051) | 51.6% | 44.0% | 42.1% | 38.5% | 37.0% |
| Wasion Group Holdings Ltd ($3393) | 30.3% | 32.8% | 35.1% | 34.2% | 30.2% |
| Datronix Holdings Ltd ($889) | 41.3% | 32.9% | 32.0% | 34.1% | 34.6% |
| Hi Sun Technology China Ltd ($818) | 20.8% | 28.1% | 37.4% | 33.3% | 34.7% |
| |
|---|
| Median (47 companies) | 13.5% | 13.6% | 13.7% | 13.8% | 16.8% |
|---|
| AAC Technologies Holdings Inc ($2018) | 44.0% | 44.2% | 42.7% | 41.4% | 41.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Nanjing Sample Technology Co Ltd ($1708) | 31.5% | 26.8% | 21.1% | 22.3% | 15.7% |
| Wasion Group Holdings Ltd ($3393) | 18.9% | 18.8% | 21.2% | 22.0% | 19.3% |
| Technovator International Ltd ($1206) | 19.2% | 19.0% | 19.0% | 20.8% | 18.0% |
| Trigiant Group Ltd ($1300) | 17.0% | 17.6% | 18.2% | 18.5% | 16.2% |
| Tongda Group Holdings Ltd ($698) | 15.3% | 17.1% | 16.8% | 18.4% | 18.9% |
| |
|---|
| Median (49 companies) | 8.8% | 5.7% | 4.4% | 4.0% | 7.4% |
|---|
| AAC Technologies Holdings Inc ($2018) | 35.2% | 35.8% | 35.8% | 34.9% | 34.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AKM Industrial Co Ltd ($1639) | 7.4% | 5.0% | 17.4% | 25.2% | 18.0% |
| Irico Group Electronics Co Ltd ($438) | 92.0% | 39.9% | 30.4% | 17.4% | 25.8% |
| Tech Pro Technology Development Ltd ($3823) | 32.8% | 7.6% | 13.1% | 15.4% | |
| Nanjing Sample Technology Co Ltd ($1708) | 3.7% | 23.9% | 15.5% | 12.0% | 2.7% |
| Tongda Group Holdings Ltd ($698) | 5.7% | 7.8% | 4.9% | 11.4% | 16.2% |
| |
|---|
| Median (49 companies) | 3.2% | 3.7% | 2.9% | 3.3% | 2.9% |
|---|
| AAC Technologies Holdings Inc ($2018) | 25.9% | 18.7% | 8.7% | 19.6% | 18.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cowell e Holdings Inc ($1415) | | 12.5% | 27.1% | 24.4% | 25.8% |
| Advanced Card Systems Holdings Ltd ($8210) | 15.5% | 26.7% | 24.7% | 20.2% | 9.7% |
| Alltronics Holdings Ltd ($833) | 19.3% | 13.1% | 15.2% | 19.8% | |
| Tongda Group Holdings Ltd ($698) | 14.3% | 15.2% | 13.5% | 16.5% | 16.3% |
| Trigiant Group Ltd ($1300) | 17.9% | 17.8% | 18.3% | 15.2% | 11.2% |
| |
|---|
| Median (49 companies) | 5.4% | 4.1% | 3.5% | 2.9% | 3.2% |
|---|
| AAC Technologies Holdings Inc ($2018) | 22.3% | 29.1% | 30.0% | 26.0% | 27.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| National Electronic Hldgs ($213) | 43.0x | 16.3x | 30.2x | 84.8x | 19.9x |
| Sino-Tech International Holdings Ltd ($724) | | | 15.7x | 24.7x | |
| Eyang Holdings Group Co Ltd ($117) | 4.2x | 3.3x | 3.7x | 17.9x | |
| SAS Dragon Hldg Ltd ($1184) | 2.8x | 7.1x | 2.0x | 6.4x | |
| Willas-Array Electronics Holdings Ltd ($854) | 2.8x | 2.2x | 2.6x | 5.7x | 5.4x |
| |
|---|
| Median (35 companies) | 0.8x | 1.1x | 1.1x | 1.2x | 0.5x |
|---|
| AAC Technologies Holdings Inc ($2018) | -0.3x | -0.1x | -0.5x | -0.1x | -0.1x |
