Sunshine 100 China Holdings Ltd CAPEX surged on 1,073% in 2015 while Revenue decreased on 9.6%
28/03/2016 • About Sunshine 100 China Holdings Ltd (
$2608) • By InTwits
Sunshine 100 China Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sunshine 100 China Holdings Ltd doesn't have a profitable business model yet: 2015 ROIC is 1.4%
- EBITDA Margin is declining: 6.8% in 2015 vs. 13.6% in 2014 vs. 11.7% in 2011
- EBITDA Margin is quite volatile: 6.8% in 2015, 13.6% in 2014, 17.8% in 2013, 20.9% in 2012, 11.7% in 2011
- Sunshine 100 China Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.3%. At the same time it's in pair with industry average of 7.0%.
- CAPEX is quite volatile: 602 in 2015, 51.3 in 2014, 213 in 2013, 127 in 2012, 146 in 2011
- The company has potentially unprofitable business model: ROIC is at 1.4%
- It operates with high leverage: Net Debt/EBITDA is 42.3x while industry average is 22.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sunshine 100 China Holdings Ltd ($2608) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 2,940 | 4,455 | 5,769 | 7,104 | 6,418 | -9.6% |
| Gross Profit | 858 | 1,412 | 1,650 | 1,506 | 1,168 | -22.4% |
| SG&A | 494 | 453 | 617 | 779 | 980 | 25.9% |
| EBITDA | 345 | 931 | 1,028 | 969 | 436 | -55.0% |
| Net Income | 24 | 301 | 672 | 767 | 601 | -21.6% |
Balance Sheet
|
|---|
| Cash | 564 | 1,108 | 1,217 | 2,558 | 1,325 | -48.2% |
| Short Term Debt | 3,864 | 6,752 | 5,050 | 8,004 | 7,578 | -5.3% |
| Long Term Debt | 3,526 | 3,560 | 8,961 | 7,061 | 12,191 | 72.6% |
Cash flow
|
|---|
| Capex | 146 | 127 | 213 | 51 | 602 | 1,073.2% |
Ratios
|
|---|
| Revenue growth | 0.2% | 51.5% | 29.5% | 23.1% | -9.6% | |
| EBITDA growth | -32.0% | 170.3% | 10.4% | -5.7% | -55.0% | |
| Gross Margin | 29.2% | 31.7% | 28.6% | 21.2% | 18.2% | -3.0% |
| EBITDA Margin | 11.7% | 20.9% | 17.8% | 13.6% | 6.8% | -6.8% |
| Net Income Margin | 0.8% | 6.8% | 11.6% | 10.8% | 9.4% | -1.4% |
| SG&A, % of revenue | 16.8% | 10.2% | 10.7% | 11.0% | 15.3% | 4.3% |
| CAPEX, % of revenue | 5.0% | 2.9% | 3.7% | 0.7% | 9.4% | 8.7% |
| ROIC | 4.0% | 8.6% | 6.5% | 4.6% | 1.4% | -3.1% |
| ROE | 2.4% | 25.8% | 40.6% | 23.2% | 11.1% | -12.1% |
| Net Debt/EBITDA | 19.8x | 9.9x | 12.4x | 12.9x | 42.3x | 29.4x |
Revenue and profitability
The company's Revenue decreased on 9.6% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 6.8 pp from 13.6% to 6.8% in 2015.
Gross Margin decreased on 3.0 pp from 21.2% to 18.2% in 2015. SG&A as a % of Revenue increased on 4.3 pp from 11.0% to 15.3% in 2015.
Net Income marign decreased slightly on 1.4 pp from 10.8% to 9.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 9.4%. The company showed CAPEX/Revenue growth of 6.5 pp from 2.9% in 2012 to 9.4% in 2015. It's average CAPEX/Revenue for the last three years was 4.6%.The company has spent a lot to CAPEX (138% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at low ROIC (1.43%) and ROE (11.11%). ROIC decreased on 3.1 pp from 4.6% to 1.4% in 2015. ROE dropped on 12.1 pp from 23.2% to 11.1% in 2015.
Leverage (Debt)
Debt level is 42.3x Net Debt / EBITDA and 45.3x Debt / EBITDA. Net Debt / EBITDA jumped on 29.4x from 12.9x to 42.3x in 2015. Debt jumped on 31.2% in 2015 while cash dropped on 48.2% in 2015.
Appendix 1: Peers in Real Estate
Below you can find Sunshine 100 China Holdings Ltd benchmarking vs. other companies in Real Estate 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 |
|---|
| Common Splendor International Health Industry Group Ltd ($286) | -0.9% | -0.5% | 1.9% | 4,120.2% | |
| Landsea Green Properties Co Ltd ($106) | | -35.1% | -51.2% | 3,097.3% | 188.5% |
| LVGEM China Real Estate Invest ($95) | | -27.5% | -21.9% | 3,008.3% | -77.4% |
| Rivera Holdings Ltd ($281) | | 197.1% | -89.9% | 2,067.2% | -92.7% |
| Ceneric Holdings Ltd ($542) | -94.0% | -73.9% | -49.8% | 1,922.5% | |
| |
|---|
| Median (177 companies) | 12.0% | 15.8% | 13.1% | 5.2% | 4.2% |
|---|
| Sunshine 100 China Holdings Ltd ($2608) | | 51.5% | 29.5% | 23.1% | -9.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tern Properties Co Ltd ($277) | 96.9% | 96.7% | 98.4% | 98.4% | 98.7% |
| GR Properties Ltd ($108) | 37.4% | 39.3% | | 98.2% | |
| Renhe Commercial Holdings Co Ltd ($1387) | 71.1% | 79.0% | 95.2% | 97.9% | 99.9% |
| YT Realty Group Ltd ($75) | 91.5% | 94.4% | 96.6% | 96.7% | 97.6% |
| ITC Properties Group Ltd ($199) | 29.8% | 22.8% | 92.9% | 95.2% | 62.7% |
| |
|---|
| Median (159 companies) | 44.2% | 41.9% | 41.9% | 39.3% | 43.0% |
|---|
| Sunshine 100 China Holdings Ltd ($2608) | 29.2% | 31.7% | 28.6% | 21.2% | 18.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chinese Estates Holdings Ltd ($127) | 340.9% | 356.2% | 91.6% | 195.5% | 397.4% |
| SOHO China Ltd ($410) | 113.8% | 113.6% | 80.8% | 104.0% | 201.9% |
| Beijing Properties Holdings Ltd ($925) | 33.2% | -606.3% | 2,162.6% | 224.3% | 186.5% |
| Swire Properties Ltd ($1972) | 283.7% | 154.5% | 114.6% | 73.2% | 100.3% |
| Tern Properties Co Ltd ($277) | 82.9% | 103.0% | 112.8% | 78.4% | 86.9% |
| |
|---|
| Median (141 companies) | 35.5% | 29.7% | 28.5% | 27.8% | 26.9% |
|---|
| Sunshine 100 China Holdings Ltd ($2608) | 11.7% | 20.9% | 17.8% | 13.6% | 6.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| LT Commercial Real Estate Ltd ($112) | 0.0% | 0.0% | 18.0% | 27,965.5% | |
| ITC Properties Group Ltd ($199) | 25.6% | 56.2% | 4,202.4% | 1,304.7% | 189.7% |
| Wanda Hotel Development Co Ltd ($169) | | 5.9% | 24.1% | 1,091.1% | 190.4% |
| Pacific Century Premium Developments Ltd ($432) | 6.5% | 2.9% | 323.1% | 351.2% | 340.6% |
| Liu Chong Hing Investment Ltd ($194) | 9.4% | 18.5% | 6.1% | 269.7% | 0.9% |
| |
|---|
| Median (178 companies) | 5.9% | 5.7% | 6.2% | 4.8% | 4.2% |
|---|
| Sunshine 100 China Holdings Ltd ($2608) | 5.0% | 2.9% | 3.7% | 0.7% | 9.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Rykadan Capital Ltd ($2288) | 17.2% | -1.8% | -2.6% | 48.4% | -3.7% |
| Colour Life Services Group Co Ltd ($1778) | | 44.2% | 47.9% | 29.3% | 14.5% |
| LVGEM China Real Estate Invest ($95) | 0.2% | -0.2% | -1.1% | 22.1% | 1.8% |
| China Vast Industrial Urban Development Co Ltd ($6166) | | 2.2% | 19.7% | 19.8% | 9.1% |
| Zall Development Group Ltd ($2098) | 39.0% | 19.2% | 17.6% | 18.7% | |
| |
|---|
| Median (181 companies) | 4.6% | 4.1% | 4.0% | 4.1% | 2.9% |
|---|
| Sunshine 100 China Holdings Ltd ($2608) | 4.0% | 8.6% | 6.5% | 4.6% | 1.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Properties Group Ltd ($1838) | 16.9x | 43.0x | 21.4x | 1,523.0x | |
| SRE Group Ltd ($1207) | 10.6x | 14.1x | 24.7x | 1,184.6x | |
| Cheuk Nang Holdings Ltd ($131) | 53.2x | | 177.3x | 901.7x | |
| Tian An China Investment Co Ltd ($28) | 2.4x | 13.2x | 15.1x | 486.6x | |
| Greenland Hong Kong Holdings Ltd ($337) | 3.7x | | 6.2x | 49.3x | 38.4x |
| |
|---|
| Median (143 companies) | 2.1x | 2.2x | 2.7x | 3.0x | 3.2x |
|---|
| Sunshine 100 China Holdings Ltd ($2608) | 19.8x | 9.9x | 12.4x | 12.9x | 42.3x |
