LVGEM China Real Estate Invest Net Debt / EBITDA jumped on 13.8x from 2.9x to 16.7x in 2015 while Debt decreased on 2.7%
24/03/2016 • About LVGEM China Real Estate Invest (
$95) • By InTwits
LVGEM China Real Estate Invest reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- LVGEM China Real Estate Invest doesn't have a profitable business model yet: 2015 ROIC is 1.8%
- EBITDA Margin is quite volatile: 32.2% in 2015, 43.0% in 2014, -6.0% in 2013, 0.3% in 2012, 2.3% in 2011
- The company has potentially unprofitable business model: ROIC is at 1.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
LVGEM China Real Estate Invest ($95) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 375 | 272 | 212 | 6,602 | 1,493 | -77.4% |
| Gross Profit | 57 | 49 | 32 | 3,054 | 784 | -74.3% |
| SG&A | | 66 | 49 | 280 | 389 | 39.1% |
| EBITDA | 8 | 1 | -13 | 2,838 | 481 | -83.1% |
| Net Income | 12 | 8 | -15 | 2,198 | 515 | -76.6% |
Balance Sheet
|
|---|
| Cash | 266 | 291 | 436 | 1,767 | 1,809 | 2.4% |
| Short Term Debt | 187 | 220 | 127 | 2,211 | 2,003 | -9.4% |
| Long Term Debt | 260 | 94 | 96 | 7,901 | 7,834 | -0.8% |
Cash flow
|
|---|
| Capex | 0 | | 1 | 670 | 111 | -83.4% |
Ratios
|
|---|
| Revenue growth | -0.1% | -27.5% | -21.9% | 3,008.3% | -77.4% | |
| EBITDA growth | -74.0% | -89.0% | -1,463.3% | -22,536.0% | -83.1% | |
| Gross Margin | 15.1% | 18.0% | 14.9% | 46.3% | 52.5% | 6.2% |
| EBITDA Margin | 2.3% | 0.3% | -6.0% | 43.0% | 32.2% | -10.8% |
| Net Income Margin | 3.2% | 3.0% | -6.9% | 33.3% | 34.5% | 1.2% |
| SG&A, % of revenue | | 24.1% | 23.2% | 4.2% | 26.0% | 21.8% |
| CAPEX, % of revenue | 0.1% | | 0.3% | 10.2% | 7.5% | -2.7% |
| ROIC | 0.2% | -0.2% | -1.1% | 22.1% | 1.8% | -20.3% |
| ROE | 1.4% | 0.9% | -1.5% | 124.3% | 21.0% | -103.3% |
| Net Debt/EBITDA | 21.5x | 24.4x | | 2.9x | 16.7x | 13.8x |
Revenue and profitability
The company's Revenue dropped on 77.4% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.9 pp from 7.5% to 9.4% in 2015.
Gross Margin increased on 6.2 pp from 46.3% to 52.5% in 2015. SG&A as a % of Revenue jumped on 21.8 pp from 4.2% to 26.0% in 2015.
Net Income marign increased slightly on 1.2 pp from 33.3% to 34.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 7.5% in 2015. CAPEX/Revenue increased7.5 pp from in 2012 to 7.5% in 2015. It's average level of CAPEX/Revenue for the last three years was 6.0%.
Return on investment
The company operates at good ROE (21.03%) while ROIC is low (1.79%). ROIC dropped on 20.3 pp from 22.1% to 1.8% in 2015. ROE dropped on 103 pp from 124% to 21.0% in 2015.
Leverage (Debt)
Debt level is 16.7x Net Debt / EBITDA and 20.5x Debt / EBITDA. Net Debt / EBITDA surged on 13.8x from 2.9x to 16.7x in 2015. Debt decreased on 2.7% in 2015 while cash increased on 2.4% in 2015.
Appendix 1: Peers in Real Estate
Below you can find LVGEM China Real Estate Invest benchmarking vs. other companies in Real Estate 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 |
|---|
| Common Splendor International Health Industry Group Ltd ($286) | -0.9% | -0.5% | 1.9% | 4,120.2% | |
| Landsea Green Properties Co Ltd ($106) | | -35.1% | -51.2% | 3,097.3% | 188.5% |
| Rivera Holdings Ltd ($281) | | 197.1% | -89.9% | 2,067.2% | -92.7% |
| Ceneric Holdings Ltd ($542) | -94.0% | -73.9% | -49.8% | 1,922.5% | |
| Rykadan Capital Ltd ($2288) | | -94.0% | 91.5% | 1,252.9% | -84.8% |
| |
|---|
| Median (177 companies) | 11.5% | 16.4% | 14.0% | 5.2% | 4.3% |
|---|
| LVGEM China Real Estate Invest ($95) | | -27.5% | -21.9% | 3,008.3% | -77.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tern Properties Co Ltd ($277) | 96.9% | 96.7% | 98.4% | 98.4% | 98.7% |
| GR Properties Ltd ($108) | 37.4% | 39.3% | | 98.2% | |
| Renhe Commercial Holdings Co Ltd ($1387) | 71.1% | 79.0% | 95.2% | 97.9% | 99.9% |
| YT Realty Group Ltd ($75) | 91.5% | 94.4% | 96.6% | 96.7% | 97.6% |
| ITC Properties Group Ltd ($199) | 29.8% | 22.8% | 92.9% | 95.2% | 62.7% |
| |
|---|
| Median (159 companies) | 44.2% | 41.9% | 41.9% | 39.1% | 42.9% |
|---|
| LVGEM China Real Estate Invest ($95) | 15.1% | 18.0% | 14.9% | 46.3% | 52.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| ITC Properties Group Ltd ($199) | 24.0% | -125.5% | -2,995.7% | 1,685.3% | -525.1% |
| Beijing Properties Holdings Ltd ($925) | 33.2% | -606.3% | 2,162.6% | 224.3% | 186.5% |
| Chinese Estates Holdings Ltd ($127) | 340.9% | 356.2% | 91.6% | 195.5% | 397.4% |
| Zall Development Group Ltd ($2098) | 73.6% | 105.3% | 133.1% | 143.2% | |
| Ceneric Holdings Ltd ($542) | -5.9% | -382.7% | -1,024.0% | 126.8% | |
| |
|---|
| Median (176 companies) | 35.5% | 29.7% | 28.5% | 26.9% | 26.9% |
|---|
| LVGEM China Real Estate Invest ($95) | 2.3% | 0.3% | -6.0% | 43.0% | 32.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| LT Commercial Real Estate Ltd ($112) | 0.0% | 0.0% | 18.0% | 27,965.5% | |
| ITC Properties Group Ltd ($199) | 25.6% | 56.2% | 4,202.4% | 1,304.7% | 189.7% |
| Wanda Hotel Development Co Ltd ($169) | | 5.9% | 24.1% | 1,091.1% | 190.4% |
| Pacific Century Premium Developments Ltd ($432) | 6.5% | 2.9% | 323.1% | 351.2% | 340.6% |
| Liu Chong Hing Investment Ltd ($194) | 9.4% | 18.5% | 6.1% | 269.7% | 0.9% |
| |
|---|
| Median (178 companies) | 5.9% | 5.6% | 6.2% | 4.7% | 3.9% |
|---|
| LVGEM China Real Estate Invest ($95) | 0.1% | | 0.3% | 10.2% | 7.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rykadan Capital Ltd ($2288) | 17.2% | -1.8% | -2.6% | 48.4% | -3.7% |
| Colour Life Services Group Co Ltd ($1778) | | 44.2% | 47.9% | 29.3% | 14.5% |
| China Vast Industrial Urban Development Co Ltd ($6166) | | 2.2% | 19.7% | 19.8% | 9.1% |
| Zall Development Group Ltd ($2098) | 39.0% | 19.2% | 17.6% | 18.7% | |
| China Overseas Land & Investment Ltd ($688) | 18.0% | 18.4% | 15.1% | 18.5% | 15.4% |
| |
|---|
| Median (181 companies) | 4.6% | 4.2% | 4.1% | 4.1% | 2.9% |
|---|
| LVGEM China Real Estate Invest ($95) | 0.2% | -0.2% | -1.1% | 22.1% | 1.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Properties Group Ltd ($1838) | 16.9x | 43.0x | 21.4x | 1,523.0x | |
| SRE Group Ltd ($1207) | 10.6x | 14.1x | 24.7x | 1,184.6x | |
| Cheuk Nang Holdings Ltd ($131) | 53.2x | | 177.3x | 901.7x | |
| Tian An China Investment Co Ltd ($28) | 2.4x | 13.2x | 15.1x | 486.6x | |
| Greenland Hong Kong Holdings Ltd ($337) | 3.7x | | 6.2x | 49.3x | 38.4x |
| |
|---|
| Median (143 companies) | 2.1x | 2.2x | 2.7x | 3.0x | 3.2x |
|---|
| LVGEM China Real Estate Invest ($95) | 21.5x | 24.4x | | 2.9x | 16.7x |
