Essex Bio-technology Ltd demonstrates fast growth in fundamentals
25/03/2016 • About Essex Bio-technology Ltd (
$1061) • By InTwits
Pay attention to Essex Bio-technology Ltd as a growth stock. Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Essex Bio-technology Ltd showed fast growth in the last financial year. Essex Bio-technology Ltd's revenue surged on 26.2% in FY2015. The growth also happened in EBITDA of 34.2% for the same period.
In the last 3 years the company showed fast revenue growth of 34.8% from 2012 to 2015 annualy. EBITDA surged on 42.8% from 2012 to 2015 annualy.
Essex Bio-technology Ltd ($1061) financials for the last 5 years
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 |
|---|
| Revenue | 213 | 267 | 347 | 518 | 654 |
|---|
| Revenue growth, % | | 25.6% | 29.9% | 49.3% | 26.2% |
|---|
| Gross margin, % | 90.5% | 91.2% | 89.6% | 79.3% | 81.0% |
|---|
| SG&A, % | | 72.9% | 68.5% | 60.5% | 61.7% |
|---|
| EBITDA | 38 | 51 | 76 | 110 | 148 |
|---|
| EBITDA growth, % | | 32.6% | 49.6% | 45.0% | 34.2% |
|---|
| EBITDA margin, % | 18.0% | 19.0% | 21.9% | 21.3% | 22.6% |
|---|
| Net Income | 33 | 39 | 55 | 75 | 105 |
|---|
| Net Income margin, % | 15.6% | 14.6% | 15.8% | 14.5% | 16.0% |
|---|
| |
| CAPEX | 21 | 98 | 36 | 8 | 11 |
|---|
| CAPEX/Revenue, % | 9.92% | 36.6% | 10.4% | 1.45% | 1.74% |
|---|
| Debt | 0 | 74 | 51 | 51 | 51 |
|---|
| Cash | 37 | 60 | 55 | 62 | 65 |
|---|
| Net Debt/EBITDA | -1.0x | 0.3x | -0.0x | -0.1x | -0.1x |
|---|
| |
| ROIC, % | 24.7% | 22.6% | 25.2% | 28.5% | 31.4% |
|---|
| ROE, % | 22.5% | 21.7% | 24.4% | 25.7% | 28.2% |
|---|
Profitability and return on investment
Margin expansion supported EBITDA growth. The company showed EBITDA margin growth of 1.30 pp from 21.3% to 22.6% in 2015. In the last 3 years Essex Bio-technology Ltd's EBITDA margin surged on 3.60 pp from 19% in 2012 to 22.6% in 2015.
We call Essex Bio-technology Ltd an attractive growth stock as together with the growth it delivers high ROIC at 31.4%. Three years ago it was lower at 22.6%. Average ROIC for the last three years was 28.4%.
Net Income margin surged on 1.50 pp from 14.5% to 16% in 2015. If we look for the longer period Essex Bio-technology Ltd's Net Income margin increased on 1.40 pp from 14.6% in 2012 to 16% in 2015.
Essex Bio-technology Ltd operates at ROE of 28.2%. For the last three years the average ROE was 26.1%.
Capital expenditures (CAPEX)
The company's CAPEX/Revenue was 1.74% in FY2015. CAPEX/Revenue dropped on 34.9 pp from 36.6% in 2012 to 1.74% in 2015. It's average CAPEX/Revenue for the last three years was 4.54%.
Leverage (Debt)
Having such a fast growth profile the company keeps negative net debt at -0.1x Net Debt/EBITDA. In the longer period leverage dropped on 0.37x from 0.28x in 2012 to -0.09x in 2015.
Peers in Biotechnology
Below we provide Essex Bio-technology Ltd benchmarking against other companies in Biotechnology 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, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Bloomage BioTechnology Corp Ltd ($963) | 34.1% | 33.4% | 36.4% | 28.3% | |
| Uni-Bio Science Group Ltd ($690) | -48.2% | -25.7% | 46.1% | 23.1% | |
| Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co Ltd ($1349) | | 73.7% | 78.9% | 13.2% | 23.1% |
| Amgen Inc ($4332) | | 10.8% | 8.2% | 7.4% | 8.0% |
| CK Life Sciences International Holdings Inc ($775) | | 29.4% | 9.4% | -0.3% | -0.7% |
| |
|---|
| Median (8 companies) | 26.6% | 20.1% | 22.9% | 3.5% | 15.5% |
|---|
| Essex Bio-technology Ltd ($1061) | | 25.6% | 29.9% | 49.3% | 26.2% |
Top companies by Gross margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co Ltd ($1349) | 82.8% | 89.9% | 92.2% | 92.2% | 91.4% |
| Uni-Bio Science Group Ltd ($690) | 62.1% | 67.2% | 79.5% | 80.0% | |
| Bloomage BioTechnology Corp Ltd ($963) | 73.2% | 69.3% | 79.9% | 78.0% | |
| Amgen Inc ($4332) | 84.4% | 81.5% | 82.1% | 78.0% | 80.5% |
| CK Life Sciences International Holdings Inc ($775) | 33.6% | 34.2% | 35.0% | 35.1% | 35.4% |
| |
|---|
| Median (8 companies) | 63.2% | 50.7% | 57.3% | 56.5% | 64.8% |
|---|
| Essex Bio-technology Ltd ($1061) | 90.5% | 91.2% | 89.6% | 79.3% | 81.0% |
Top companies by EBITDA margin, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Bloomage BioTechnology Corp Ltd ($963) | 56.2% | 46.8% | 39.2% | 45.2% | |
| Amgen Inc ($4332) | 34.5% | 38.6% | 38.3% | 41.3% | 48.8% |
| Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co Ltd ($1349) | 35.5% | 33.4% | 29.0% | 31.5% | 29.3% |
| CK Life Sciences International Holdings Inc ($775) | 9.3% | 9.9% | 10.0% | 10.7% | 11.3% |
| Tianjin TEDA Biomedical Engineering Co Ltd ($8189) | 6.0% | 6.9% | 7.4% | 9.1% | |
| |
|---|
| Median (8 companies) | 14.7% | 8.4% | 8.7% | 9.9% | 20.3% |
|---|
| Essex Bio-technology Ltd ($1061) | 18.0% | 19.0% | 21.9% | 21.3% | 22.6% |
Top companies by CAPEX/Revenue, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| China Regenerative Medicine International Ltd ($8158) | 1,076.2% | 40,271.9% | 810.7% | 3,305.9% | 1,295.1% |
| Uni-Bio Science Group Ltd ($690) | 5.1% | 23.9% | 28.9% | 35.5% | |
| Bloomage BioTechnology Corp Ltd ($963) | 7.0% | 35.8% | 30.4% | 24.6% | |
| CK Life Sciences International Holdings Inc ($775) | 5.4% | 3.8% | 5.8% | 9.9% | 6.0% |
| Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co Ltd ($1349) | 24.6% | 49.3% | 13.6% | 9.4% | 6.6% |
| |
|---|
| Median (8 companies) | 6.2% | 20.8% | 9.7% | 9.6% | 6.3% |
|---|
| Essex Bio-technology Ltd ($1061) | 9.9% | 36.6% | 10.4% | 1.5% | 1.7% |
Top companies by ROIC, %
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| Bloomage BioTechnology Corp Ltd ($963) | 33.7% | 30.1% | 24.1% | 27.2% | |
| Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co Ltd ($1349) | 15.7% | 20.0% | 20.9% | 18.6% | 17.6% |
| Amgen Inc ($4332) | 11.1% | 13.0% | 11.7% | 11.2% | 14.6% |
| Tianjin TEDA Biomedical Engineering Co Ltd ($8189) | 7.5% | 12.4% | 10.1% | 9.8% | |
| CK Life Sciences International Holdings Inc ($775) | 3.0% | 4.2% | 4.1% | 4.3% | 4.8% |
| |
|---|
| Median (8 companies) | 9.3% | 8.3% | 7.1% | 7.0% | 9.7% |
|---|
| Essex Bio-technology Ltd ($1061) | 24.7% | 22.6% | 25.2% | 28.5% | 31.4% |
Top companies by Net Debt / EBITDA
| FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Top 5 |
|---|
| CK Life Sciences International Holdings Inc ($775) | 5.4x | 4.3x | 6.1x | 6.4x | 6.0x |
| Amgen Inc ($4332) | 2.7x | 3.5x | 4.0x | 3.3x | 2.6x |
| Tianjin TEDA Biomedical Engineering Co Ltd ($8189) | 2.0x | 2.0x | 1.4x | 0.9x | |
| Bloomage BioTechnology Corp Ltd ($963) | -1.2x | -0.5x | -0.3x | -0.5x | |
| Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co Ltd ($1349) | -0.7x | -0.4x | -2.4x | -2.2x | -1.9x |
| |
|---|
| Median (5 companies) | 2.1x | 2.7x | 1.4x | 0.9x | 2.6x |
|---|
| Essex Bio-technology Ltd ($1061) | -1.0x | 0.3x | -0.0x | -0.1x | -0.1x |
