China Mobile Games and Cultural Investment Ltd Net Income surged on 344% in 2015 and Revenue surged on 34.8%
23/03/2016 • About China Mobile Games and Cultural Investment Ltd (
$8081) • By InTwits
China Mobile Games and Cultural Investment Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Mobile Games and Cultural Investment Ltd doesn't have a profitable business model yet: 2015 ROIC is -3.1%
- The company operates at negative EBITDA Margin: -1.3%
- China Mobile Games and Cultural Investment 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 -5.4%0
- China Mobile Games and Cultural Investment Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 16.4%. At the same time it's a lot of higher than industry average of 4.9%.
- CAPEX is quite volatile: 13.5 in 2015, 12.3 in 2014, 41.7 in 2013, 0.0020 in 2012, 6.1 in 2011
- The company has unprofitable business model: ROIC is at -3.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Mobile Games and Cultural Investment Ltd ($8081) key annual financial indicators
| mln. | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 21.6 | 106.6 | 99.6 | 191.3 | 257.9 | 34.8% |
| Gross Profit | 4.2 | 7.0 | 45.1 | 162.1 | 187.7 | 15.8% |
| SG&A | | 24.5 | | | | |
| EBITDA | -25.4 | -13.8 | -5.6 | 11.5 | -3.4 | -129.9% |
| Net Income | -26.1 | -21.1 | -8.8 | -26.2 | 64.0 | -344.2% |
Balance Sheet
|
|---|
| Cash | 11.8 | 77.2 | 42.1 | 53.5 | 78.6 | 46.8% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 15.0 | 303.4 | 1,922.6% |
| Long Term Debt | 0.0 | 39.6 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 6.1 | 0.0 | 41.7 | 12.3 | 13.5 | 9.7% |
Ratios
|
|---|
| Revenue growth | -16.7% | 393.7% | -6.6% | 92.2% | 34.8% | |
| EBITDA growth | 78.8% | -45.8% | -59.5% | -306.0% | -129.9% | |
| Gross Margin | 19.4% | 6.5% | 45.3% | 84.8% | 72.8% | -12.0% |
| EBITDA Margin | -117.7% | -12.9% | -5.6% | 6.0% | -1.3% | -7.3% |
| Net Income Margin | -120.9% | -19.8% | -8.9% | -13.7% | 24.8% | 38.5% |
| SG&A, % of revenue | | 23.0% | | | | 0.0% |
| CAPEX, % of revenue | 28.2% | 0.0% | 41.9% | 6.4% | 5.2% | -1.2% |
| ROIC | -115.5% | -15.9% | -9.1% | -4.7% | -3.1% | 1.6% |
| ROE | -118.0% | -30.5% | -6.4% | -10.7% | 11.2% | 21.9% |
| Net Debt/EBITDA | | | | -3.4x | | 3.4x |
Revenue and profitability
China Mobile Games and Cultural Investment Ltd's Revenue jumped on 34.8% in 2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 7.3 pp from 6.0% to -1.3% in 2015.
Gross Margin dropped on 12.0 pp from 84.8% to 72.8% in 2015.
Net Income marign surged on 38.5 pp from -13.7% to 24.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
China Mobile Games and Cultural Investment Ltd's CAPEX/Revenue was 5.2% in 2015. CAPEX/Revenue increased on 5.2 pp from 0.0019% in 2012 to 5.2% in 2015. Average CAPEX/Revenue for the last three years was 17.9%.
Return on investment
The company operates at negative ROIC (-3.13%) and low but positive ROE (11.16%). ROIC increased slightly on 1.6 pp from -4.7% to -3.1% in 2015. ROE jumped on 21.9 pp from -10.7% to 11.2% in 2015.
Leverage (Debt)
Debt level is -3.1x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA jumped on 3.4x from -3.4x to in 2015. Debt jumped on 1,923% in 2015 while cash jumped on 46.8% in 2015.
Appendix 1: Peers in Software
Below you can find China Mobile Games and Cultural Investment Ltd benchmarking vs. other companies in Software 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 |
|---|
| Pizu Group Holdings Ltd ($8053) | | 40.3% | -42.9% | 1,742.9% | 157.9% |
| China City Railway Transportation Technology Holdings Co Ltd ($1522) | 194.6% | 164.0% | 33.6% | 100.5% | |
| Epicurean and Co Ltd ($8213) | | 177.0% | 185.7% | 62.6% | 22.0% |
| China Bio Cassava Holdings Ltd ($8129) | | -14.2% | 38.8% | 55.1% | -19.7% |
| Finsoft Corp ($8018) | | -17.1% | -1.4% | 54.8% | -9.9% |
| |
|---|
| Median (34 companies) | 16.2% | 10.6% | 11.4% | 20.9% | 12.4% |
|---|
| China Mobile Games and Cultural Investment Ltd ($8081) | | 393.7% | -6.6% | 92.2% | 34.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Bio Cassava Holdings Ltd ($8129) | 90.2% | 90.4% | 97.4% | 98.4% | 98.3% |
| Chanjet Information Technology Co Ltd ($1588) | 91.9% | 89.2% | 91.3% | 92.4% | 91.4% |
| NetDragon Websoft Inc ($777) | 90.1% | 93.4% | 90.8% | 89.3% | |
| Tian Ge Interactive Holdings Ltd ($1980) | 87.5% | 88.5% | 87.6% | 84.8% | 77.7% |
| Kingdee International Software Group Co Ltd ($268) | 70.1% | 65.0% | 75.3% | 82.5% | 81.5% |
| |
|---|
| Median (33 companies) | 52.8% | 48.4% | 42.5% | 42.1% | 43.5% |
|---|
| China Mobile Games and Cultural Investment Ltd ($8081) | 19.4% | 6.5% | 45.3% | 84.8% | 72.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sinosoft Technology Group Ltd ($1297) | 55.5% | 62.6% | 54.9% | 57.2% | 59.0% |
| International Entertainment Corp ($1009) | 235.1% | 50.8% | 64.0% | 54.9% | 62.0% |
| China Binary Sale Technology Ltd ($8255) | 41.3% | 35.1% | 35.4% | 44.4% | 50.5% |
| Microsoft Corp ($4338) | 42.8% | 33.5% | 39.2% | 38.0% | 25.8% |
| Kingdee International Software Group Co Ltd ($268) | 19.5% | 7.8% | 33.2% | 37.2% | 31.9% |
| |
|---|
| Median (34 companies) | 12.2% | 11.1% | 15.5% | 10.1% | 10.3% |
|---|
| China Mobile Games and Cultural Investment Ltd ($8081) | -117.7% | -12.9% | -5.6% | 6.0% | -1.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| NetDragon Websoft Inc ($777) | 13.3% | 21.1% | 34.6% | 54.6% | |
| China Eco-Farming Ltd ($8166) | 0.3% | 0.6% | 0.7% | 18.1% | 2.5% |
| TravelSky Technology Ltd ($696) | 5.8% | 8.9% | 21.7% | 18.1% | |
| Kingsoft Corp Ltd ($3888) | 6.8% | 4.3% | 3.8% | 14.3% | 11.1% |
| Sing Lee Software Group Ltd ($8076) | 19.4% | 3.3% | 0.2% | 14.0% | 1.1% |
| |
|---|
| Median (33 companies) | 2.0% | 1.4% | 2.2% | 3.6% | 1.8% |
|---|
| China Mobile Games and Cultural Investment Ltd ($8081) | 28.2% | 0.0% | 41.9% | 6.4% | 5.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Binary Sale Technology Ltd ($8255) | | 27.7% | 26.9% | 28.4% | 19.0% |
| Microsoft Corp ($4338) | 43.4% | 28.6% | 30.3% | 26.2% | 15.6% |
| Finsoft Corp ($8018) | | 140.5% | 4.6% | 25.0% | -5.6% |
| Sinosoft Technology Group Ltd ($1297) | 31.6% | 34.0% | 21.9% | 20.2% | 20.8% |
| Boyaa Interactive International Ltd ($434) | 100.4% | 75.3% | 21.3% | 20.0% | 21.4% |
| |
|---|
| Median (34 companies) | 4.9% | 5.6% | 6.1% | 3.3% | 5.1% |
|---|
| China Mobile Games and Cultural Investment Ltd ($8081) | -115.5% | -15.9% | -9.1% | -4.7% | -3.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pizu Group Holdings Ltd ($8053) | | | | 346.1x | -0.4x |
| Epicurean and Co Ltd ($8213) | 2.9x | 2.3x | 4.7x | 12.3x | 12.0x |
| Sing Lee Software Group Ltd ($8076) | | | | 6.2x | 4.4x |
| China Technology Solar Power Holdings Ltd ($8111) | | | 7.4x | 3.3x | 0.2x |
| Chinasoft International Ltd ($354) | -1.3x | -0.7x | 0.7x | 1.5x | 0.7x |
| |
|---|
| Median (22 companies) | -0.9x | -1.0x | -1.5x | -1.3x | -0.4x |
|---|
| China Mobile Games and Cultural Investment Ltd ($8081) | | | | -3.4x | |
