Jiangsu Expressway Co Ltd reports 91.3% CAPEX growth while 1.2% Revenue decline
25/03/2016 • About Jiangsu Expressway Co Ltd (
$177) • By InTwits
Jiangsu Expressway Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Jiangsu Expressway Co Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.4%. At the same time it's a lot of higher than industry average of 6.9%.
- CAPEX is quite volatile: 786 in 2015, 411 in 2014, 241 in 2013, 165 in 2012, 175 in 2011
- The company has business model with average profitability: ROIC is at 10.9%
- It operates with high leverage: Net Debt/EBITDA is 2.5x while industry average is -20.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Jiangsu Expressway Co Ltd ($177) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 7,215 | 7,587 | 7,412 | 8,557 | 8,457 | -1.2% |
| Gross Profit | 3,579 | 3,532 | 3,718 | 3,883 | 4,042 | 4.1% |
| SG&A | 117 | 114 | 116 | 154 | 128 | -16.6% |
| EBITDA | 4,383 | 4,323 | 4,498 | 5,072 | 5,204 | 2.6% |
| Net Income | 2,430 | 2,333 | 2,708 | 2,228 | 2,507 | 12.5% |
Balance Sheet
|
|---|
| Cash | 806 | 686 | 409 | 709 | 221 | -68.8% |
| Short Term Debt | 3,067 | 4,752 | 4,222 | 7,584 | 8,648 | 14.0% |
| Long Term Debt | 2,465 | 950 | 1,262 | 6,667 | 4,839 | -27.4% |
Cash flow
|
|---|
| Capex | 175 | 165 | 241 | 411 | 786 | 91.3% |
Ratios
|
|---|
| Revenue growth | 9.7% | 5.2% | -2.3% | 15.5% | -1.2% | |
| EBITDA growth | 1.8% | -1.4% | 4.1% | 12.8% | 2.6% | |
| Gross Margin | 49.6% | 46.6% | 50.2% | 45.4% | 47.8% | 2.4% |
| EBITDA Margin | 60.8% | 57.0% | 60.7% | 59.3% | 61.5% | 2.3% |
| Net Income Margin | 33.7% | 30.8% | 36.5% | 26.0% | 29.6% | 3.6% |
| SG&A, % of revenue | 1.6% | 1.5% | 1.6% | 1.8% | 1.5% | -0.3% |
| CAPEX, % of revenue | 2.4% | 2.2% | 3.2% | 4.8% | 9.3% | 4.5% |
| ROIC | 14.2% | 13.5% | 13.9% | 11.9% | 10.9% | -0.9% |
| ROE | 14.1% | 12.7% | 14.1% | 11.0% | 12.1% | 1.1% |
| Net Debt/EBITDA | 1.1x | 1.2x | 1.1x | 2.7x | 2.5x | -0.1x |
Revenue and profitability
Jiangsu Expressway Co Ltd's Revenue decreased slightly on 1.2% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.3 pp from 59.3% to 61.5% in 2015.
Gross Margin increased on 2.4 pp from 45.4% to 47.8% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign increased on 3.6 pp from 26.0% to 29.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Jiangsu Expressway Co Ltd had CAPEX/Revenue of 9.3%. Jiangsu Expressway Co Ltd showed CAPEX/Revenue growth of 7.1 pp from 2.2% in 2012 to 9.3% in 2015. It's average CAPEX/Revenue for the last three years was 5.8%.
Return on investment
The company operates at good ROE (12.08%) while ROIC is low (10.94%). ROIC decreased slightly on 0.92 pp from 11.9% to 10.9% in 2015. ROE increased slightly on 1.1 pp from 11.0% to 12.1% in 2015.
Leverage (Debt)
Debt level is 2.5x Net Debt / EBITDA and 2.6x Debt / EBITDA. Net Debt / EBITDA dropped on 0.1x from 2.7x to 2.5x in 2015. Debt decreased on 5.4% in 2015 while cash dropped on 68.8% in 2015.
Appendix 1: Peers in Commercial Services
Below we provide Jiangsu Expressway Co Ltd benchmarking against other companies in Commercial Services 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 |
|---|
| Global Energy Resources International Group Ltd ($8192) | | -61.9% | -27.8% | 2,912.9% | 19.7% |
| Dingyi Group Investment Ltd ($508) | | 8.8% | -95.9% | 1,361.2% | -32.6% |
| Zuoli Kechuang Micro-Finance Co Ltd ($6866) | | | 34.6% | 86.9% | 37.2% |
| China Smartpay Group Holdings Ltd ($8325) | | 60.0% | 274.7% | 75.6% | 124.5% |
| Goldpac Group Ltd ($3315) | | 52.3% | 64.4% | 36.8% | 10.8% |
| |
|---|
| Median (62 companies) | 34.2% | 9.0% | 6.7% | 9.4% | 6.1% |
|---|
| Jiangsu Expressway Co Ltd ($177) | | 5.2% | -2.3% | 15.5% | -1.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HC International Inc ($2280) | 84.7% | 87.5% | 91.9% | 92.5% | |
| Fu Shou Yuan International Group Ltd ($1448) | 81.6% | 80.5% | 80.4% | 80.0% | 77.6% |
| U Banquet Group Holding Ltd ($8107) | | | | 76.5% | 74.5% |
| China Communication Telecom Services Co Ltd ($8206) | -56.6% | 61.6% | 58.6% | 69.1% | 70.2% |
| Dingyi Group Investment Ltd ($508) | 76.5% | 75.8% | | 64.5% | 86.0% |
| |
|---|
| Median (57 companies) | 32.9% | 31.0% | 29.2% | 30.9% | 30.9% |
|---|
| Jiangsu Expressway Co Ltd ($177) | 49.6% | 46.6% | 50.2% | 45.4% | 47.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shenzhen International Holdings Ltd ($152) | 69.3% | 60.2% | 65.8% | 97.1% | 73.6% |
| Shenzhen Expressway Co Ltd ($548) | 80.4% | 74.3% | 79.4% | 76.6% | 53.0% |
| Zuoli Kechuang Micro-Finance Co Ltd ($6866) | | 61.6% | 84.9% | 75.9% | 80.9% |
| Yuexiu Transport Infrastructure Ltd ($1052) | 74.3% | 78.3% | 74.5% | 74.0% | 71.6% |
| Anhui Expressway Co Ltd ($995) | 62.7% | 56.9% | 54.1% | 60.4% | |
| |
|---|
| Median (62 companies) | 16.0% | 16.0% | 13.4% | 11.0% | 8.5% |
|---|
| Jiangsu Expressway Co Ltd ($177) | 60.8% | 57.0% | 60.7% | 59.3% | 61.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Kai Yuan Holdings Ltd ($1215) | 16.8% | 3.9% | 7.0% | 59.8% | |
| COSCO Pacific Ltd ($1199) | 111.3% | 96.6% | 66.6% | 43.3% | |
| Finet Group Ltd ($8317) | 3.9% | 10.3% | 9.1% | 26.0% | 8.4% |
| HC International Inc ($2280) | 15.1% | 8.5% | 28.7% | 24.7% | |
| Dragon Crown Group Holdings Ltd ($935) | 2.5% | 37.2% | 52.0% | 23.0% | 13.0% |
| |
|---|
| Median (61 companies) | 3.9% | 3.2% | 4.5% | 3.6% | 4.9% |
|---|
| Jiangsu Expressway Co Ltd ($177) | 2.4% | 2.2% | 3.2% | 4.8% | 9.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mega Expo Holdings Ltd ($1360) | | 270.5% | 481.1% | 54.4% | 10.1% |
| China Packaging Holdings Development Ltd ($1439) | 50.0% | 52.0% | 46.6% | 34.1% | |
| Wonderful Sky Financial Group Holdings Ltd ($1260) | 136.8% | 51.5% | 26.6% | 30.0% | 29.5% |
| U Banquet Group Holding Ltd ($8107) | | 98.5% | 23.9% | 28.0% | -3.7% |
| PPS International Holdings Ltd ($8201) | | 101.6% | 35.6% | 23.8% | -13.7% |
| |
|---|
| Median (62 companies) | 5.0% | 6.0% | 5.2% | 4.2% | 3.4% |
|---|
| Jiangsu Expressway Co Ltd ($177) | 14.2% | 13.5% | 13.9% | 11.9% | 10.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dalian Port PDA Co Ltd ($2880) | 5.7x | 5.7x | 4.8x | 4.7x | 4.1x |
| Sichuan Expressway Co Ltd ($107) | 1.8x | 2.7x | 3.8x | 4.3x | |
| Anxian Yuan China Holdings Ltd ($922) | | | 4.6x | 3.8x | 0.8x |
| Eagle Legend Asia Ltd ($936) | 4.3x | 4.0x | 4.0x | 3.3x | 6.2x |
| Yuexiu Transport Infrastructure Ltd ($1052) | 2.9x | 4.5x | 3.1x | 2.7x | 5.3x |
| |
|---|
| Median (41 companies) | -0.1x | -0.1x | -0.8x | -0.5x | -0.5x |
|---|
| Jiangsu Expressway Co Ltd ($177) | 1.1x | 1.2x | 1.1x | 2.7x | 2.5x |
