Sino-Tech International Holdings Ltd reports 293% EBITDA decline and 5.4 pp EBITDA Margin decline from 1.7% to -3.7%
24/03/2016 • About Sino-Tech International Holdings Ltd (
$724) • By InTwits
Sino-Tech International Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sino-Tech International Holdings Ltd is a company in decline: 2015 revenue growth was -9.1%, 5 years revenue CAGR was -7.0%
- The company operates at negative EBITDA Margin: -3.7%
- Sino-Tech 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 -1.5%0
- Sino-Tech International Holdings 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 8.1%.
- CAPEX is quite volatile: 10.5 in 2015, 7.7 in 2014, 17.9 in 2013, 0.86 in 2012, 37.3 in 2011
- The company has unprofitable business model: ROIC is at -10.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sino-Tech International Holdings Ltd ($724) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 742.3 | 572.5 | 660.4 | 599.9 | 545.1 | -9.1% |
| Gross Profit | -42.2 | 4.8 | 44.5 | 33.3 | 32.6 | -2.0% |
| SG&A | 57.5 | 58.7 | 59.3 | 61.4 | 70.5 | 14.7% |
| EBITDA | -33.4 | -15.9 | 12.9 | 10.4 | -20.1 | -293.0% |
| Net Income | -934.2 | -339.4 | -24.7 | -40.4 | -23.2 | -42.6% |
Balance Sheet
|
|---|
| Cash | 44.0 | 42.3 | 80.9 | 45.5 | 67.3 | 47.7% |
| Short Term Debt | 153.3 | 8.3 | 283.5 | 302.4 | 248.0 | -18.0% |
| Long Term Debt | 244.8 | 263.4 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 37.3 | 0.9 | 17.9 | 7.7 | 10.5 | 35.9% |
Ratios
|
|---|
| Revenue growth | -5.5% | -22.9% | 15.4% | -9.2% | -9.1% | |
| EBITDA growth | 1,030.0% | -52.6% | -181.5% | -19.6% | -293.0% | |
| Gross Margin | -5.7% | 0.8% | 6.7% | 5.6% | 6.0% | 0.4% |
| EBITDA Margin | -4.5% | -2.8% | 2.0% | 1.7% | -3.7% | -5.4% |
| Net Income Margin | -125.9% | -59.3% | -3.7% | -6.7% | -4.3% | 2.5% |
| SG&A, % of revenue | 7.8% | 10.2% | 9.0% | 10.2% | 12.9% | 2.7% |
| CAPEX, % of revenue | 5.0% | 0.2% | 2.7% | 1.3% | 1.9% | 0.6% |
| ROIC | -10.0% | -9.8% | -3.6% | -3.9% | -10.0% | -6.1% |
| ROE | -128.7% | -132.7% | -29.3% | -78.2% | -41.3% | 36.9% |
| Net Debt/EBITDA | | | 15.7x | 24.7x | | -24.7x |
Revenue and profitability
Sino-Tech International Holdings Ltd's Revenue decreased on 9.1% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 5.4 pp from 1.7% to -3.7% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue increased on 2.7 pp from 10.2% to 12.9% in 2015.
Net Income marign increased on 2.5 pp from -6.7% to -4.3% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Sino-Tech International Holdings Ltd had CAPEX/Revenue of 1.9%. The company's CAPEX/Revenue increased slightly on 1.8 pp from 0.15% in 2012 to 1.9% in 2015. For the last three years the average CAPEX/Revenue was 2.0%.
Return on investment
The company operates at negative ROIC (-10.04%) and ROE (-41.35%). ROIC decreased on 6.1 pp from -3.9% to -10.0% in 2015. ROE surged on 36.9 pp from -78.2% to -41.3% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -26.7x and Debt / EBITDA is . Net Debt / EBITDA dropped on 24.7x from 24.7x to in 2015. Debt dropped on 18.0% in 2015 while cash jumped on 47.7% in 2015.
Appendix 1: Peers in Electronics
Below we provide Sino-Tech International Holdings Ltd benchmarking against other companies in Electronics industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Netcom Technology Holdings Ltd ($8071) | | 11.6% | -23.0% | 104.1% | -72.7% |
| Q Technology Group Co Ltd ($1478) | | 125.0% | 121.2% | 53.2% | 1.9% |
| Technovator International Ltd ($1206) | | 27.4% | 34.1% | 35.9% | 19.0% |
| Tongda Group Holdings Ltd ($698) | | 8.3% | 6.4% | 32.1% | 26.8% |
| Advanced Card Systems Holdings Ltd ($8210) | | 36.9% | 20.8% | 26.7% | -4.8% |
| |
|---|
| Median (50 companies) | 7.1% | 1.0% | 3.6% | 7.2% | 0.9% |
|---|
| Sino-Tech International Holdings Ltd ($724) | | -22.9% | 15.4% | -9.2% | -9.1% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Advanced Card Systems Holdings Ltd ($8210) | 51.4% | 54.0% | 58.1% | 49.5% | 49.6% |
| AAC Technologies Holdings Inc ($2018) | 44.0% | 44.2% | 42.7% | 41.4% | 41.5% |
| TeleEye Holdings Ltd ($8051) | 51.6% | 44.0% | 42.1% | 38.5% | 37.0% |
| Wasion Group Holdings Ltd ($3393) | 30.3% | 32.8% | 35.1% | 34.2% | 30.2% |
| Datronix Holdings Ltd ($889) | 41.3% | 32.9% | 32.0% | 34.1% | 34.6% |
| |
|---|
| Median (48 companies) | 13.6% | 14.1% | 13.8% | 14.1% | 17.0% |
|---|
| Sino-Tech International Holdings Ltd ($724) | -5.7% | 0.8% | 6.7% | 5.6% | 6.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AAC Technologies Holdings Inc ($2018) | 35.2% | 35.8% | 35.8% | 34.9% | 34.8% |
| Nanjing Sample Technology Co Ltd ($1708) | 31.5% | 26.8% | 21.1% | 22.3% | 15.7% |
| Wasion Group Holdings Ltd ($3393) | 18.9% | 18.8% | 21.2% | 22.0% | 19.3% |
| Technovator International Ltd ($1206) | 19.2% | 19.0% | 19.0% | 20.8% | 18.0% |
| Trigiant Group Ltd ($1300) | 17.0% | 17.6% | 18.2% | 18.5% | 16.2% |
| |
|---|
| Median (50 companies) | 9.3% | 7.4% | 7.6% | 5.4% | 6.7% |
|---|
| Sino-Tech International Holdings Ltd ($724) | -4.5% | -2.8% | 2.0% | 1.7% | -3.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AKM Industrial Co Ltd ($1639) | 7.4% | 5.0% | 17.4% | 25.2% | 18.0% |
| AAC Technologies Holdings Inc ($2018) | 25.9% | 18.7% | 8.7% | 19.6% | 18.4% |
| Irico Group Electronics Co Ltd ($438) | 92.0% | 39.9% | 30.4% | 17.4% | 25.8% |
| Tech Pro Technology Development Ltd ($3823) | 32.8% | 7.6% | 13.1% | 15.4% | 7.7% |
| Nanjing Sample Technology Co Ltd ($1708) | 3.7% | 23.9% | 15.5% | 12.0% | 2.7% |
| |
|---|
| Median (50 companies) | 3.3% | 3.9% | 3.2% | 4.2% | 3.5% |
|---|
| Sino-Tech International Holdings Ltd ($724) | 5.0% | 0.2% | 2.7% | 1.3% | 1.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| AAC Technologies Holdings Inc ($2018) | 22.3% | 29.1% | 30.0% | 26.0% | 27.8% |
| Cowell e Holdings Inc ($1415) | | 12.5% | 27.1% | 24.4% | 25.8% |
| Advanced Card Systems Holdings Ltd ($8210) | 15.5% | 26.7% | 24.7% | 20.2% | 9.7% |
| Alltronics Holdings Ltd ($833) | 19.3% | 13.1% | 15.2% | 19.8% | |
| Q Technology Group Co Ltd ($1478) | | 46.8% | 36.4% | 18.0% | 8.6% |
| |
|---|
| Median (50 companies) | 5.9% | 4.6% | 4.1% | 3.7% | 2.8% |
|---|
| Sino-Tech International Holdings Ltd ($724) | -10.0% | -9.8% | -3.6% | -3.9% | -10.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| National Electronic Hldgs ($213) | 43.0x | 16.3x | 30.2x | 84.8x | 19.9x |
| Eyang Holdings Group Co Ltd ($117) | 4.2x | 3.3x | 3.7x | 17.9x | |
| SAS Dragon Hldg Ltd ($1184) | 2.8x | 7.1x | 2.0x | 6.4x | |
| Willas-Array Electronics Holdings Ltd ($854) | 2.8x | 2.2x | 2.6x | 5.7x | 5.4x |
| Pine Technology Holdings Ltd ($1079) | | 8.0x | 3.3x | 4.9x | |
| |
|---|
| Median (36 companies) | 0.7x | 1.0x | 1.1x | 0.8x | 0.1x |
|---|
| Sino-Tech International Holdings Ltd ($724) | | | 15.7x | 24.7x | |
