Neway Group Holdings Ltd EBITDA dropped on 909% in 2015 and EBITDA Margin dropped on 17.1 pp from 1.6% to -15.4%
24/03/2016 • About Neway Group Holdings Ltd (
$55) • By InTwits
Neway Group Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Neway Group Holdings Ltd doesn't have a profitable business model yet: 2015 ROIC is -11.7%
- EBITDA Margin is quite volatile: -15.4% in 2015, 1.6% in 2014, 3.9% in 2013, 1.5% in 2012, 10.3% in 2011
- Neway Group Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.9%. At the same time it's a lot of higher than industry average of 7.0%.
- CAPEX is quite volatile: 7.1 in 2015, 22.0 in 2014, 15.7 in 2013, 56.4 in 2012, 59.1 in 2011
- The company has unprofitable business model: ROIC is at -11.7%
- It operates with high leverage: Net Debt/EBITDA is 4.3x while industry average is -1.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Neway Group Holdings Ltd ($55) key annual financial indicators
| mln. | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 678.2 | 660.7 | 643.7 | 613.3 | 521.3 | -15.0% |
| Gross Profit | 136.9 | 105.1 | 112.7 | 118.8 | 93.5 | -21.3% |
| SG&A | | 124.7 | 124.9 | 138.6 | 147.4 | 6.3% |
| EBITDA | 69.6 | 10.1 | 24.8 | 10.0 | -80.5 | -908.8% |
| Net Income | 46.9 | -55.9 | 1.7 | -21.0 | -67.3 | 220.0% |
Balance Sheet
|
|---|
| Cash | 325.3 | 283.4 | 247.4 | 232.5 | 234.1 | 0.7% |
| Short Term Debt | 8.6 | 2.6 | 1.6 | 18.7 | 6.0 | -67.9% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 59.1 | 56.4 | 15.7 | 22.0 | 7.1 | -67.8% |
Ratios
|
|---|
| Revenue growth | 19.2% | -2.6% | -2.6% | -4.7% | -15.0% | |
| EBITDA growth | 5.8% | -85.5% | 146.9% | -59.9% | -908.8% | |
| Gross Margin | 20.2% | 15.9% | 17.5% | 19.4% | 17.9% | -1.4% |
| EBITDA Margin | 10.3% | 1.5% | 3.9% | 1.6% | -15.4% | -17.1% |
| Net Income Margin | 6.9% | -8.5% | 0.3% | -3.4% | -12.9% | -9.5% |
| SG&A, % of revenue | | 18.9% | 19.4% | 22.6% | 28.3% | 5.7% |
| CAPEX, % of revenue | 8.7% | 8.5% | 2.4% | 3.6% | 1.4% | -2.2% |
| ROIC | 4.0% | -2.8% | -0.8% | -2.4% | -11.7% | -9.3% |
| ROE | 5.7% | -6.8% | 0.2% | -2.7% | -8.3% | -5.6% |
| Net Debt/EBITDA | -4.6x | -27.9x | -9.9x | -21.5x | | 21.5x |
Revenue and profitability
Neway Group Holdings Ltd's Revenue dropped on 15.0% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 17.1 pp from 1.6% to -15.4% in 2015.
Gross Margin decreased slightly on 1.4 pp from 19.4% to 17.9% in 2015. SG&A as a % of Revenue increased on 5.7 pp from 22.6% to 28.3% in 2015.
Net Income marign decreased on 9.5 pp from -3.4% to -12.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 1.4% in 2015. Neway Group Holdings Ltd showed decline in CAPEX/Revenue of 7.2 pp from 8.5% in 2012 to 1.4% in 2015. It's average level of CAPEX/Revenue for the last three years was 2.5%.
Return on investment
The company operates at negative ROIC (-11.68%) and ROE (-8.30%). ROIC decreased on 9.3 pp from -2.4% to -11.7% in 2015. ROE decreased on 5.6 pp from -2.7% to -8.3% in 2015.
Leverage (Debt)
Debt level is 4.3x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA surged on 21.5x from -21.5x to in 2015. Debt dropped on 67.9% in 2015 while cash increased slightly on 0.72% in 2015.
Appendix 1: Peers in Entertainment
Below you can find Neway Group Holdings Ltd benchmarking vs. other companies in Entertainment 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 |
|---|
| China 3D Digital Entertainment Ltd ($8078) | | -67.2% | 295.2% | 185.2% | -44.3% |
| Universe International Holdings Ltd ($1046) | | -42.2% | 4.3% | 159.4% | 46.3% |
| China Vanguard Group Ltd ($8156) | | -7.0% | -62.7% | 145.0% | 29.2% |
| China LotSynergy Holdings Ltd ($1371) | | 15.0% | 22.5% | 39.1% | -37.8% |
| Nan Hai Corp Ltd ($680) | 20.7% | -16.3% | 18.7% | 36.0% | |
| |
|---|
| Median (26 companies) | 16.3% | 2.9% | 14.1% | 1.2% | -4.3% |
|---|
| Neway Group Holdings Ltd ($55) | | -2.6% | -2.6% | -4.7% | -15.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Amax International Holdings Ltd ($959) | | | 92.1% | 98.6% | 96.6% |
| China Vanguard Group Ltd ($8156) | 65.0% | 63.8% | 88.2% | 93.8% | 95.2% |
| Cheung Wo International Holdings Ltd ($9) | 49.4% | -17.5% | 71.4% | 77.7% | |
| REXLot Holdings Ltd ($555) | 63.0% | 70.2% | 73.1% | 73.4% | |
| China LotSynergy Holdings Ltd ($1371) | 81.7% | 79.5% | 73.1% | 70.1% | 55.8% |
| |
|---|
| Median (22 companies) | 48.3% | 44.9% | 56.8% | 44.1% | 40.1% |
|---|
| Neway Group Holdings Ltd ($55) | 20.2% | 15.9% | 17.5% | 19.4% | 17.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cheung Wo International Holdings Ltd ($9) | 7.8% | -62.7% | -217.3% | 104.5% | |
| Neptune Group Ltd ($70) | 101.1% | 98.6% | 98.6% | 86.6% | 99.0% |
| Universe International Holdings Ltd ($1046) | 62.2% | 36.6% | 44.6% | 74.6% | 73.6% |
| China LotSynergy Holdings Ltd ($1371) | 61.2% | 53.3% | 60.9% | 56.1% | -31.0% |
| Haichang Holdings Ltd ($2255) | 46.9% | 55.0% | 44.5% | 46.3% | |
| |
|---|
| Median (26 companies) | 14.2% | 22.1% | 19.7% | 18.3% | -17.0% |
|---|
| Neway Group Holdings Ltd ($55) | 10.3% | 1.5% | 3.9% | 1.6% | -15.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| National Arts Entertainment and Culture Group Ltd ($8228) | 536.1% | 1,237.1% | 771.1% | 799.0% | 508.9% |
| Cheung Wo International Holdings Ltd ($9) | 44.7% | 90.3% | 465.2% | 383.2% | |
| Alibaba Pictures Group Ltd ($1060) | 0.5% | 16.1% | 17.2% | 34.8% | |
| Mei Ah Entertainment Group Ltd ($391) | 2.5% | 6.8% | 3.6% | 25.4% | 1.8% |
| Nan Hai Corp Ltd ($680) | 29.1% | 19.2% | 35.2% | 18.2% | |
| |
|---|
| Median (26 companies) | 7.2% | 9.7% | 9.0% | 5.0% | 8.5% |
|---|
| Neway Group Holdings Ltd ($55) | 8.7% | 8.5% | 2.4% | 3.6% | 1.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dynam Japan Holdings Co Ltd ($6889) | 22.5% | 23.8% | 25.4% | 21.8% | 10.5% |
| Neptune Group Ltd ($70) | 22.0% | 22.8% | 23.8% | 21.1% | 18.1% |
| China LotSynergy Holdings Ltd ($1371) | 18.0% | 15.5% | 16.9% | 14.8% | -9.8% |
| Pegasus Entertainment Holdings Ltd ($1326) | 94.5% | 82.1% | 18.5% | 10.3% | -21.3% |
| SMI Holdings Group Ltd ($198) | 5.8% | 1.3% | 8.4% | 9.9% | |
| |
|---|
| Median (27 companies) | 1.1% | -1.1% | 3.7% | 0.3% | -1.8% |
|---|
| Neway Group Holdings Ltd ($55) | 4.0% | -2.8% | -0.8% | -2.4% | -11.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Nan Hai Corp Ltd ($680) | 25.2x | 80.8x | 3.5x | 20.8x | |
| Cheung Wo International Holdings Ltd ($9) | 28.3x | | | 19.1x | |
| REXLot Holdings Ltd ($555) | 0.4x | -0.0x | -0.2x | 7.2x | |
| Orange Sky Golden Harvest Entertainment Holdings Ltd ($1132) | -0.8x | 1.1x | 4.2x | 2.7x | |
| China 3D Digital Entertainment Ltd ($8078) | -11.9x | | -0.5x | 2.3x | |
| |
|---|
| Median (19 companies) | 0.0x | -0.1x | -0.5x | -0.0x | -2.7x |
|---|
| Neway Group Holdings Ltd ($55) | -4.6x | -27.9x | -9.9x | -21.5x | |
