Sing Tao News Corp Ltd reports 45.4% Net Income decline and 6.2% Revenue decline
23/03/2016 • About Sing Tao News Corp Ltd (
$1105) • By InTwits
Sing Tao News Corp Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sing Tao News Corp Ltd is a company in decline: 2015 revenue growth was -6.2%, 5 years revenue CAGR was -8.5%
- EBITDA Margin is relatively stable: 8.2% in 2015 vs. 9.8% in 2014 vs. 9.7% in 2011
- Sing Tao News Corp Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.2%. At the same time it's a lot of higher than industry average of 60.8%.
- CAPEX is quite volatile: 1.5 in 2015, 33.3 in 2014, 65.9 in 2013, 29.9 in 2012, 116 in 2011
- The company has potentially unprofitable business model: ROIC is at 3.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sing Tao News Corp Ltd ($1105) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,391 | 2,211 | 2,036 | 1,987 | 1,864 | -6.2% |
| Gross Profit | 746 | 705 | 710 | 720 | 695 | -3.6% |
| SG&A | | 620 | 621 | 612 | 336 | -45.1% |
| EBITDA | 233 | 182 | 176 | 194 | 152 | -21.4% |
| Net Income | 139 | 120 | 106 | 114 | 62 | -45.4% |
Balance Sheet
|
|---|
| Cash | 540 | 612 | 686 | 826 | 844 | 2.2% |
| Short Term Debt | 1 | 1 | 1 | 1 | 0 | -66.6% |
| Long Term Debt | 3 | 3 | 3 | 2 | 0 | -86.4% |
Cash flow
|
|---|
| Capex | 116 | 30 | 66 | 33 | 2 | -95.4% |
Ratios
|
|---|
| Revenue growth | -17.8% | -7.5% | -7.9% | -2.4% | -6.2% | |
| EBITDA growth | -1.2% | -21.8% | -3.4% | 10.3% | -21.4% | |
| Gross Margin | 31.2% | 31.9% | 34.9% | 36.3% | 37.3% | 1.0% |
| EBITDA Margin | 9.7% | 8.2% | 8.6% | 9.8% | 8.2% | -1.6% |
| Net Income Margin | 5.8% | 5.4% | 5.2% | 5.7% | 3.3% | -2.4% |
| SG&A, % of revenue | | 28.0% | 30.5% | 30.8% | 18.0% | -12.8% |
| CAPEX, % of revenue | 4.8% | 1.4% | 3.2% | 1.7% | 0.1% | -1.6% |
| ROIC | 7.6% | 4.9% | 4.6% | 5.4% | 3.2% | -2.1% |
| ROE | 7.4% | 6.2% | 5.4% | 5.6% | 3.0% | -2.6% |
| Net Debt/EBITDA | -2.3x | -3.3x | -3.9x | -4.2x | -5.5x | -1.3x |
Revenue and profitability
Sing Tao News Corp Ltd's Revenue decreased on 6.2% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.6 pp from 9.8% to 8.2% in 2015.
Gross Margin increased slightly on 1.00 pp from 36.3% to 37.3% in 2015. SG&A as a % of Revenue dropped on 12.8 pp from 30.8% to 18.0% in 2015.
Net Income marign decreased on 2.4 pp from 5.7% to 3.3% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 0.082%. The company showed small CAPEX/Revenue decline of 1.3 pp from 1.4% in 2012 to 0.082% in 2015. It's average CAPEX/Revenue for the last three years was 1.7%.
Return on investment
The company operates at low ROIC (3.24%) and ROE (3.03%). ROIC decreased on 2.1 pp from 5.4% to 3.2% in 2015. ROE decreased on 2.6 pp from 5.6% to 3.0% in 2015.
Leverage (Debt)
Debt level is -5.5x Net Debt / EBITDA and 0.0x Debt / EBITDA. Net Debt / EBITDA dropped on 1.3x from -4.2x to -5.5x in 2015. Debt dropped on 80.6% in 2015 while cash increased on 2.2% in 2015.
Appendix 1: Peers in Media
Below you can find Sing Tao News Corp Ltd benchmarking vs. other companies in Media 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 |
|---|
| SCMP Group Ltd ($583) | | 7.8% | 12.5% | -95.9% | 12.5% |
| Hong Kong Economic Times Holdings Ltd ($423) | | 5.6% | 2.7% | 3.1% | 5.3% |
| Modern Media Holdings ($72) | | 11.8% | -3.7% | -4.3% | -1.3% |
| Focus Media Network Ltd ($8112) | | -10.6% | 34.6% | 5.6% | -5.2% |
| Oriental Press Group ($18) | | -5.3% | -3.2% | -1.4% | -7.8% |
| |
|---|
| Median (15 companies) | 3.8% | 4.5% | -1.8% | -4.3% | -9.0% |
|---|
| Sing Tao News Corp Ltd ($1105) | | -7.5% | -7.9% | -2.4% | -6.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| I-CABLE Communications Ltd ($1097) | 95.6% | 94.8% | 94.7% | 94.1% | 94.4% |
| Television Broadcasts Ltd ($511) | 65.3% | 62.9% | 60.9% | 59.0% | 54.9% |
| Modern Media Holdings ($72) | 57.1% | 57.5% | 55.8% | 55.6% | 50.8% |
| One Media Group Ltd ($426) | 52.0% | 57.3% | 56.7% | 54.5% | 52.7% |
| Focus Media Network Ltd ($8112) | 81.0% | 68.0% | 67.2% | 50.8% | 57.6% |
| |
|---|
| Median (16 companies) | 47.8% | 39.0% | 40.5% | 36.1% | 38.6% |
|---|
| Sing Tao News Corp Ltd ($1105) | 31.2% | 31.9% | 34.9% | 36.3% | 37.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SCMP Group Ltd ($583) | 26.9% | 23.5% | 20.5% | 218.1% | 193.5% |
| Media Chinese International Ltd ($685) | 20.0% | 20.0% | 18.3% | 18.1% | 16.5% |
| One Media Group Ltd ($426) | 14.4% | 18.7% | 23.0% | 22.8% | 15.2% |
| Phoenix Satellite Television Holdings Ltd ($2008) | 29.8% | 30.1% | 31.1% | 24.6% | 14.1% |
| Oriental Press Group ($18) | 20.6% | 9.5% | 12.8% | 14.6% | 13.9% |
| |
|---|
| Median (15 companies) | 15.1% | 12.9% | 11.6% | 12.5% | 10.1% |
|---|
| Sing Tao News Corp Ltd ($1105) | 9.7% | 8.2% | 8.6% | 9.8% | 8.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SCMP Group Ltd ($583) | 3.6% | 7.0% | 5.3% | 52.2% | 85.2% |
| Evergrande Health Industry Group Ltd ($708) | 58.0% | 14.6% | 2.4% | 2.9% | 13.5% |
| I-CABLE Communications Ltd ($1097) | 10.6% | 10.1% | 7.6% | 11.3% | 13.0% |
| Hong Kong Economic Times Holdings Ltd ($423) | 9.0% | 8.4% | 8.5% | 1.3% | 10.0% |
| Tom Group Ltd ($2383) | 10.0% | 11.9% | 8.4% | 9.4% | 9.5% |
| |
|---|
| Median (15 companies) | 4.0% | 3.9% | 5.3% | 2.9% | 6.1% |
|---|
| Sing Tao News Corp Ltd ($1105) | 4.8% | 1.4% | 3.2% | 1.7% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Media Chinese International Ltd ($685) | 18.7% | 18.6% | 17.8% | 18.4% | 15.6% |
| One Media Group Ltd ($426) | 17.1% | 25.6% | 21.8% | 16.0% | 8.9% |
| Next Media Ltd ($282) | 1.7% | 8.5% | 6.7% | 8.2% | 6.8% |
| Modern Media Holdings ($72) | 23.8% | 20.6% | 10.4% | 9.3% | 5.5% |
| Hong Kong Economic Times Holdings Ltd ($423) | 23.3% | 11.5% | -1.5% | 3.2% | 5.2% |
| |
|---|
| Median (15 companies) | 9.8% | 4.4% | 4.7% | 2.6% | 2.2% |
|---|
| Sing Tao News Corp Ltd ($1105) | 7.6% | 4.9% | 4.6% | 5.4% | 3.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tom Group Ltd ($2383) | | | | 8.1x | 16.7x |
| I-CABLE Communications Ltd ($1097) | -2.0x | -4.0x | -0.8x | 0.2x | 2.0x |
| One Media Group Ltd ($426) | -3.8x | -2.3x | -0.6x | -1.1x | 1.5x |
| Modern Media Holdings ($72) | -0.9x | -0.8x | -0.9x | 0.1x | 1.0x |
| Media Chinese International Ltd ($685) | -1.1x | -1.4x | 0.8x | 0.6x | 0.2x |
| |
|---|
| Median (11 companies) | -1.3x | -1.4x | -1.1x | -1.1x | -0.1x |
|---|
| Sing Tao News Corp Ltd ($1105) | -2.3x | -3.3x | -3.9x | -4.2x | -5.5x |
