China Energine International Holdings Ltd Net Debt / EBITDA surged on 18.3x from 13.3x to 31.7x in 2015 while EBITDA dropped on 34.6%
23/03/2016 • About China Energine International Holdings Ltd (
$1185) • By InTwits
China Energine International Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Energine International Holdings Ltd doesn't have a profitable business model yet: 2015 ROIC is 0.1%
- China Energine International Holdings 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 -3.7%0
- China Energine International Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.5%. At the same time it's in pair with industry average of 67.4%.
- CAPEX is quite volatile: 7.5 in 2015, 20.4 in 2014, 91.4 in 2013, 19.4 in 2012, 92.6 in 2011
- The company has potentially unprofitable business model: ROIC is at 0.1%
- It operates with high leverage: Net Debt/EBITDA is 31.7x while industry average is 2.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Energine International Holdings Ltd ($1185) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 406 | 990 | 1,330 | 2,700 | 2,617 | -3.1% |
| Gross Profit | 25 | -20 | 24 | 263 | 245 | -7.0% |
| SG&A | | 213 | 223 | 258 | 262 | 1.6% |
| EBITDA | -80 | -172 | -151 | 64 | 42 | -34.6% |
| Net Income | 11 | 27 | 39 | 91 | 75 | -17.0% |
Balance Sheet
|
|---|
| Cash | 369 | 462 | 632 | 863 | 300 | -65.2% |
| Short Term Debt | 530 | 792 | 890 | 986 | 1,131 | 14.7% |
| Long Term Debt | 797 | 1,044 | 1,064 | 729 | 494 | -32.2% |
Cash flow
|
|---|
| Capex | 93 | 19 | 91 | 20 | 8 | -63.0% |
Ratios
|
|---|
| Revenue growth | -41.8% | 143.6% | 34.3% | 103.1% | -3.1% | |
| EBITDA growth | 11.8% | 114.4% | -12.6% | -142.4% | -34.6% | |
| Gross Margin | 6.0% | -2.1% | 1.8% | 9.8% | 9.4% | -0.4% |
| EBITDA Margin | -19.8% | -17.4% | -11.3% | 2.4% | 1.6% | -0.8% |
| Net Income Margin | 2.8% | 2.7% | 2.9% | 3.4% | 2.9% | -0.5% |
| SG&A, % of revenue | | 21.5% | 16.8% | 9.6% | 10.0% | 0.5% |
| CAPEX, % of revenue | 22.8% | 2.0% | 6.9% | 0.8% | 0.3% | -0.5% |
| ROIC | -3.7% | -6.2% | -4.9% | 0.7% | 0.1% | -0.6% |
| ROE | 0.7% | 1.5% | 2.1% | 4.4% | 3.4% | -1.0% |
| Net Debt/EBITDA | | | | 13.3x | 31.7x | 18.3x |
Revenue and profitability
The company's Revenue decreased on 3.1% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased slightly on 0.77 pp from 2.4% to 1.6% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.29% in 2015. The company showed small CAPEX/Revenue decline of 1.7 pp from 2.0% in 2012 to 0.29% in 2015. It's average level of CAPEX/Revenue for the last three years was 2.6%.
Return on investment
The company operates at low ROIC (0.13%) and ROE (3.39%). ROIC decreased slightly on 0.59 pp from 0.72% to 0.13% in 2015. ROE decreased slightly on 0.98 pp from 4.4% to 3.4% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 31.7x and Debt / EBITDA is 38.9x. Net Debt / EBITDA jumped on 18.3x from 13.3x to 31.7x in 2015. Debt decreased on 5.3% in 2015 while cash dropped on 65.2% in 2015.
Appendix 1: Peers in Telecommunications
Below you can find China Energine International Holdings Ltd benchmarking vs. other companies in Telecommunications 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 |
|---|
| MOBI Development Co Ltd ($947) | | -13.8% | 29.1% | 85.6% | -3.8% |
| Vodatel Networks Holdings Ltd ($8033) | | -5.9% | -4.6% | 81.7% | -25.8% |
| Gold Tat Group International Ltd ($8266) | | 29.4% | 1,582.2% | 77.0% | 26.5% |
| Great World Co Holdings Ltd ($8003) | | 1,651.8% | -81.7% | 61.9% | -3.7% |
| TCL Communication Technology Holdings Ltd ($2618) | | 12.9% | 60.9% | 58.5% | -7.0% |
| |
|---|
| Median (53 companies) | 18.4% | 8.7% | 8.1% | 6.9% | 3.0% |
|---|
| China Energine International Holdings Ltd ($1185) | | 143.6% | 34.3% | 103.1% | -3.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HKBN Ltd ($1310) | | | 84.3% | 86.5% | 86.9% |
| Synertone Communication Corp ($1613) | 65.4% | 68.1% | 64.1% | 70.5% | 50.3% |
| Zhi Cheng Holdings Ltd ($8130) | 61.6% | 45.9% | 41.0% | 64.0% | 19.6% |
| APT Satellite Holdings Ltd ($1045) | 52.3% | 58.7% | 64.1% | 62.5% | 61.0% |
| Hong Kong Television Network Ltd ($1137) | | -59.6% | -101.3% | 59.7% | |
| |
|---|
| Median (47 companies) | 28.1% | 25.5% | 28.1% | 27.1% | 26.6% |
|---|
| China Energine International Holdings Ltd ($1185) | 6.0% | -2.1% | 1.8% | 9.8% | 9.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Satellite Telecommunications Holdings Ltd ($1135) | 83.5% | 86.5% | 85.8% | 81.6% | 82.4% |
| APT Satellite Holdings Ltd ($1045) | 76.7% | 81.0% | 78.9% | 77.5% | 78.8% |
| Synertone Communication Corp ($1613) | 49.5% | 44.9% | 48.5% | 49.4% | 51.5% |
| HKBN Ltd ($1310) | | | 39.2% | 40.1% | 39.0% |
| PCCW Ltd ($8) | 31.4% | 32.0% | 31.9% | 39.2% | 30.6% |
| |
|---|
| Median (53 companies) | 14.0% | 9.5% | 6.7% | 7.9% | 10.4% |
|---|
| China Energine International Holdings Ltd ($1185) | -19.8% | -17.4% | -11.3% | 2.4% | 1.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hong Kong Television Network Ltd ($1137) | | 12,435.9% | 504.9% | 1,283.5% | |
| Asia Satellite Telecommunications Holdings Ltd ($1135) | 61.8% | 93.8% | 71.7% | 75.0% | 52.8% |
| Hanny Holdings Ltd ($275) | 80.8% | 19.8% | 11.6% | 28.3% | 0.2% |
| APT Satellite Holdings Ltd ($1045) | 155.2% | 74.3% | 2.5% | 27.2% | 115.8% |
| China Electronics Corp Holdings Co Ltd ($85) | 1.5% | 1.8% | 8.3% | 27.1% | |
| |
|---|
| Median (52 companies) | 3.0% | 2.5% | 3.6% | 4.1% | 2.5% |
|---|
| China Energine International Holdings Ltd ($1185) | 22.8% | 2.0% | 6.9% | 0.8% | 0.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| VTech Holdings Ltd ($303) | 40.5% | 37.6% | 39.5% | 40.0% | 39.8% |
| Telecom Service One Holdings Ltd ($8145) | | 95.0% | 5.4% | 26.7% | 39.8% |
| TCL Communication Technology Holdings Ltd ($2618) | 6.4% | -1.6% | 6.0% | 17.2% | 13.4% |
| China Fiber Optic Network System Group Ltd ($3777) | 23.1% | 18.8% | 17.6% | 16.6% | |
| China U-Ton Holdings Ltd ($6168) | 69.5% | 35.7% | 25.0% | 16.2% | |
| |
|---|
| Median (53 companies) | 7.4% | 6.3% | 5.8% | 6.6% | 7.1% |
|---|
| China Energine International Holdings Ltd ($1185) | -3.7% | -6.2% | -4.9% | 0.7% | 0.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CCT Land Holdings Ltd ($261) | | 10.1x | 23.8x | 48.4x | |
| China Electronics Corp Holdings Co Ltd ($85) | -2.1x | -2.0x | -1.3x | 12.5x | |
| China All Access Holdings Ltd ($633) | -1.0x | 0.9x | 1.8x | 5.2x | |
| Synertone Communication Corp ($1613) | -0.3x | -0.4x | -2.2x | 4.8x | 2.5x |
| CITIC Telecom International Holdings Ltd ($1883) | -0.3x | -0.2x | 3.5x | 3.4x | 3.2x |
| |
|---|
| Median (38 companies) | -0.2x | -0.2x | 0.6x | 0.4x | 0.2x |
|---|
| China Energine International Holdings Ltd ($1185) | | | | 13.3x | 31.7x |
