Wison Engineering Services Co Ltd reports 22.6% revenue decline in 2015 and 0.90 pp EBITDA Margin growth from 5.7% to 6.6%
24/03/2016 • About Wison Engineering Services Co Ltd (
$2236) • By InTwits
Wison Engineering Services Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 6.6% in 2015, 5.7% in 2014, -9.1% in 2013, 17.2% in 2012, 18.5% in 2011
- Wison Engineering Services Co Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.8%. At the same time it's in pair with industry average of 6.2%.
- CAPEX is quite volatile: 4.1 in 2015, 5.8 in 2014, 497 in 2013, 391 in 2012, 363 in 2011
- The company has business model with average profitability: ROIC is at 11.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Wison Engineering Services Co Ltd ($2236) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5,037 | 4,892 | 3,675 | 6,992 | 5,414 | -22.6% |
| Gross Profit | 1,207 | 1,140 | 143 | 792 | 817 | 3.1% |
| SG&A | 149 | 243 | 457 | 300 | 344 | 14.7% |
| EBITDA | 929 | 841 | -336 | 396 | 355 | -10.3% |
| Net Income | 519 | 467 | -471 | 179 | 205 | 14.6% |
Balance Sheet
|
|---|
| Cash | 510 | 1,746 | 294 | 542 | 1,253 | 131.1% |
| Short Term Debt | 1,392 | 2,266 | 1,554 | 540 | 230 | -57.4% |
| Long Term Debt | 201 | 290 | 0 | 0 | 0 | -100.0% |
Cash flow
|
|---|
| Capex | 363 | 391 | 497 | 6 | 4 | -28.9% |
Ratios
|
|---|
| Revenue growth | 1.2% | -2.9% | -24.9% | 90.3% | -22.6% | |
| EBITDA growth | -1.6% | -9.5% | -139.9% | -217.9% | -10.3% | |
| Gross Margin | 24.0% | 23.3% | 3.9% | 11.3% | 15.1% | 3.8% |
| EBITDA Margin | 18.5% | 17.2% | -9.1% | 5.7% | 6.6% | 0.9% |
| Net Income Margin | 10.3% | 9.5% | -12.8% | 2.6% | 3.8% | 1.2% |
| SG&A, % of revenue | 3.0% | 5.0% | 12.4% | 4.3% | 6.4% | 2.1% |
| CAPEX, % of revenue | 7.2% | 8.0% | 13.5% | 0.1% | 0.1% | -0.0% |
| ROIC | 27.5% | 22.3% | -9.9% | 11.6% | 11.2% | -0.4% |
| ROE | 69.6% | 36.6% | -28.4% | 11.6% | 11.4% | -0.2% |
| Net Debt/EBITDA | 1.2x | 1.0x | | -0.0x | -2.9x | -2.9x |
Revenue and profitability
The company's Revenue dropped on 22.6% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.90 pp from 5.7% to 6.6% in 2015.
Gross Margin increased on 3.8 pp from 11.3% to 15.1% in 2015. SG&A as a % of Revenue increased on 2.1 pp from 4.3% to 6.4% in 2015.
Net Income marign increased slightly on 1.2 pp from 2.6% to 3.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.076% in 2015. CAPEX/Revenue decreased on 7.9 pp from 8.0% in 2012 to 0.076% in 2015. It's average level of CAPEX/Revenue for the last three years was 4.6%.
Return on investment
The company operates at low ROIC (11.19%) and ROE (11.40%). ROIC showed almost no change in 2015. ROE showed almost no change in 2015.
Leverage (Debt)
Debt level is -2.9x Net Debt / EBITDA and 0.6x Debt / EBITDA. Net Debt / EBITDA dropped on 2.9x from -0.0057x to -2.9x in 2015. Debt dropped on 57.4% in 2015 while cash jumped on 131% in 2015.
Appendix 1: Peers in Engineering&Construction
Below you can find Wison Engineering Services Co Ltd benchmarking vs. other companies in Engineering&Construction 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 |
|---|
| Richly Field China Development Ltd ($313) | | | -45.0% | 464.2% | -65.7% |
| Junefield Department Store Group Ltd ($758) | 22.9% | -20.3% | -24.9% | 126.6% | |
| CNQC International Holdings Ltd ($1240) | | 21.6% | 91.0% | 103.7% | 807.4% |
| China Resources and Transportation Group Ltd ($269) | | 939.8% | 3,196.3% | 87.9% | -41.6% |
| Broad Greenstate International Co Ltd ($1253) | | 25.2% | 30.8% | 82.9% | 17.5% |
| |
|---|
| Median (43 companies) | 8.2% | 10.3% | 21.3% | 14.5% | 14.0% |
|---|
| Wison Engineering Services Co Ltd ($2236) | | -2.9% | -24.9% | 90.3% | -22.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huayu Expressway Group Ltd ($1823) | 2.2% | 43.6% | 65.6% | 64.0% | |
| HNA Infrastructure Company Ltd ($357) | 61.6% | 66.4% | 62.1% | 62.4% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 50.1% | 54.1% | 54.3% | 41.5% | 30.1% |
| Kingbo Strike Ltd ($1421) | 22.9% | 32.4% | 44.4% | 40.3% | 30.7% |
| Broad Greenstate International Co Ltd ($1253) | 16.7% | 20.1% | 28.7% | 35.8% | 36.7% |
| |
|---|
| Median (38 companies) | 11.5% | 12.8% | 14.4% | 14.1% | 14.4% |
|---|
| Wison Engineering Services Co Ltd ($2236) | 24.0% | 23.3% | 3.9% | 11.3% | 15.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huayu Expressway Group Ltd ($1823) | -0.5% | 46.2% | 73.8% | 77.1% | |
| HNA Infrastructure Company Ltd ($357) | 60.0% | 62.8% | 63.7% | 62.8% | |
| Beijing Capital International Airport Co Ltd ($694) | 55.1% | 53.4% | 52.9% | 50.3% | 51.6% |
| Cheung Kong Infrastructure Holdings Ltd ($1038) | 39.8% | 31.2% | 20.6% | 36.2% | 60.9% |
| Grand Ming Group Holdings Ltd ($1271) | 17.5% | 10.0% | 15.8% | 31.0% | 19.0% |
| |
|---|
| Median (44 companies) | 7.8% | 9.0% | 8.3% | 7.8% | 8.5% |
|---|
| Wison Engineering Services Co Ltd ($2236) | 18.5% | 17.2% | -9.1% | 5.7% | 6.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HNA Infrastructure Company Ltd ($357) | 43.3% | 36.8% | 5.7% | 85.4% | |
| PYI Corp Ltd ($498) | 6.6% | 3.7% | 4.2% | 24.5% | 13.1% |
| Shun Cheong Holdings ($650) | 7.2% | 16.4% | 8.0% | 23.9% | |
| Freetech Road Recycling Technology Holdings Ltd ($6888) | 6.1% | 4.2% | 7.7% | 20.2% | 3.2% |
| KFM Kingdom Holdings Ltd ($3816) | 6.5% | 4.6% | 11.5% | 14.9% | 9.6% |
| |
|---|
| Median (44 companies) | 4.3% | 2.4% | 2.4% | 1.7% | 2.0% |
|---|
| Wison Engineering Services Co Ltd ($2236) | 7.2% | 8.0% | 13.5% | 0.1% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chun Sing Engineering Holdings Ltd ($2277) | | | 98.3% | 54.9% | 43.7% |
| Broad Greenstate International Co Ltd ($1253) | | 33.2% | 85.1% | 51.2% | 26.0% |
| Kingbo Strike Ltd ($1421) | | 56.9% | 125.4% | 48.9% | 11.4% |
| Ngai Shun Holdings Ltd ($1246) | | 68.8% | 77.2% | 45.2% | 31.0% |
| CNQC International Holdings Ltd ($1240) | 23.1% | 12.2% | 22.3% | 40.4% | 21.8% |
| |
|---|
| Median (45 companies) | 6.9% | 6.1% | 5.7% | 4.3% | 2.7% |
|---|
| Wison Engineering Services Co Ltd ($2236) | 27.5% | 22.3% | -9.9% | 11.6% | 11.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Resources and Transportation Group Ltd ($269) | | | | 66.7x | 29.7x |
| CNC Holdings Ltd ($8356) | -0.7x | | 22.0x | 21.9x | 24.3x |
| Deson Development International Holdings ($262) | 3.1x | 3.8x | 4.9x | 13.7x | 47.0x |
| Chun Wo Development Holdings Ltd ($711) | | 14.3x | 8.1x | 12.6x | 15.9x |
| Hsin Chong Construction Group Ltd ($404) | 4.3x | 1.8x | 8.0x | 10.2x | 41.7x |
| |
|---|
| Median (37 companies) | 0.5x | 1.3x | 1.2x | 2.3x | 2.3x |
|---|
| Wison Engineering Services Co Ltd ($2236) | 1.2x | 1.0x | | -0.0x | -2.9x |
