CT Environmental Group Ltd reports 92.9% EBITDA growth and 5.9 pp EBITDA Margin growth from 58.7% to 64.6%
29/03/2016 • About CT Environmental Group Ltd (
$1363) • By InTwits
CT Environmental Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- CT Environmental Group Ltd is a fast growth stock: 2015 revenue growth was 75.4%, 5 year revenue CAGR was 35.4% at 2015 ROIC 20.1%
- CT Environmental Group Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 43.2%. At the same time it's a lot of higher than industry average of 23.3%.
- CAPEX is quite volatile: 581 in 2015, 421 in 2014, 104 in 2013, 203 in 2012, 122 in 2011
- The company has highly profitable business model: ROIC is at 20.1%
- It operates with high leverage: Net Debt/EBITDA is 1.8x while industry average is -1.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
CT Environmental Group Ltd ($1363) key annual financial indicators
| mln. | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 384 | 312 | 384 | 818 | 1,435 | 75.4% |
| Gross Profit | 222 | 205 | 243 | 461 | 716 | 55.1% |
| SG&A | 32 | 17 | 33 | 66 | 139 | 110.5% |
| EBITDA | 200 | 199 | 241 | 480 | 927 | 92.9% |
| Net Income | 137 | 144 | 178 | 336 | 599 | 78.0% |
Balance Sheet
|
|---|
| Cash | 42 | 8 | 308 | 117 | 383 | 228.1% |
| Short Term Debt | 55 | 66 | 40 | 298 | 642 | 115.2% |
| Long Term Debt | 338 | 416 | 391 | 743 | 1,367 | 84.1% |
Cash flow
|
|---|
| Capex | 122 | 203 | 104 | 421 | 581 | 38.0% |
Ratios
|
|---|
| Revenue growth | 21.9% | -18.7% | 23.1% | 112.9% | 75.4% | |
| EBITDA growth | 36.0% | -0.8% | 21.5% | 99.0% | 92.9% | |
| Gross Margin | 57.7% | 65.8% | 63.1% | 56.4% | 49.9% | -6.5% |
| EBITDA Margin | 52.2% | 63.6% | 62.8% | 58.7% | 64.6% | 5.9% |
| Net Income Margin | 35.6% | 46.2% | 46.3% | 41.1% | 41.7% | 0.6% |
| SG&A, % of revenue | 8.4% | 5.3% | 8.6% | 8.1% | 9.7% | 1.6% |
| CAPEX, % of revenue | 31.8% | 65.0% | 27.1% | 51.4% | 40.5% | -11.0% |
| ROIC | 34.4% | 25.9% | 20.5% | 20.8% | 20.1% | -0.7% |
| ROE | 71.2% | 58.6% | 29.6% | 28.6% | 27.5% | -1.1% |
| Net Debt/EBITDA | 1.8x | 2.4x | 0.5x | 1.9x | 1.8x | -0.2x |
Revenue and profitability
CT Environmental Group Ltd's Revenue surged on 75.4% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 5.8 pp from 8.6% to 14.4% in 2015.
Gross Margin decreased on 6.5 pp from 56.4% to 49.9% in 2015. SG&A as a % of Revenue increased slightly on 1.6 pp from 8.1% to 9.7% in 2015.
Net Income marign increased slightly on 0.61 pp from 41.1% to 41.7% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 CT Environmental Group Ltd had CAPEX/Revenue of 40.5%. The company showed big decline in CAPEX/Revenue of 24.5 pp from 65.0% in 2012 to 40.5% in 2015. Average CAPEX/Revenue for the last three years was 39.7%.The company invested a big chunk of EBITDA (62.7%) to CAPEX to fuel its growth.
Return on investment
The company operates at high and attractive ROIC (20.10%) and ROE (27.51%). ROIC decreased slightly on 0.72 pp from 20.8% to 20.1% in 2015. ROE decreased slightly on 1.1 pp from 28.6% to 27.5% in 2015.
Leverage (Debt)
Debt level is 1.8x Net Debt / EBITDA and 2.2x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 1.9x to 1.8x in 2015. Debt jumped on 93.0% in 2015 while cash surged on 228% in 2015.
Appendix 1: Peers in Environmental Control
Below you can find CT Environmental Group Ltd benchmarking vs. other companies in Environmental Control 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 |
|---|
| Sky Forever Supply Chain Management Group Ltd ($8047) | | -73.4% | 446.4% | -62.3% | 12,494.5% |
| ELL Environmental Holdings Ltd ($1395) | | 5.3% | 38.8% | 30.9% | 70.8% |
| Ozner Water International Holding Ltd ($2014) | | 183.9% | 38.5% | 27.2% | 45.7% |
| China Everbright International Ltd ($257) | | -2.2% | 56.0% | 19.5% | 34.3% |
| EverChina International Holdings Co Ltd ($202) | | -1.9% | -8.6% | -89.0% | 26.4% |
| |
|---|
| Median (18 companies) | 1.6% | -0.2% | 12.6% | 16.0% | 3.1% |
|---|
| CT Environmental Group Ltd ($1363) | | -18.7% | 23.1% | 112.9% | 75.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| EverChina International Holdings Co Ltd ($202) | 40.2% | 51.8% | 53.4% | 95.3% | 95.4% |
| Ozner Water International Holding Ltd ($2014) | 56.7% | 64.5% | 67.8% | 65.4% | 58.9% |
| China Water Affairs Group Ltd ($855) | 42.7% | 44.0% | 43.1% | 41.8% | 47.3% |
| China Everbright International Ltd ($257) | 41.3% | 49.4% | 44.7% | 46.7% | 45.8% |
| New Universe International Group Ltd ($8068) | 51.9% | 47.9% | 47.7% | 45.0% | 43.2% |
| |
|---|
| Median (18 companies) | 34.8% | 33.2% | 30.5% | 31.3% | 34.4% |
|---|
| CT Environmental Group Ltd ($1363) | 57.7% | 65.8% | 63.1% | 56.4% | 49.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 55.9% | 57.5% | 56.6% | 57.8% | 57.9% |
| China Everbright International Ltd ($257) | 37.3% | 44.6% | 40.7% | 43.6% | 44.1% |
| China Water Affairs Group Ltd ($855) | 38.8% | 38.2% | 38.1% | 37.1% | 40.3% |
| New Universe International Group Ltd ($8068) | 42.0% | 40.2% | 37.8% | 39.3% | 36.6% |
| Dynagreen Environmental Protection Group Co Ltd ($1330) | 31.5% | 24.3% | | | 33.5% |
| |
|---|
| Median (18 companies) | 10.3% | 8.1% | 3.8% | 2.3% | 16.2% |
|---|
| CT Environmental Group Ltd ($1363) | 52.2% | 63.6% | 62.8% | 58.7% | 64.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chaoyue Group Ltd ($147) | 3.8% | | 18.1% | 9.2% | 100.9% |
| Ozner Water International Holding Ltd ($2014) | 179.8% | 94.9% | 102.2% | 148.5% | 90.9% |
| Integrated Waste Solutions Group Holdings Ltd ($923) | 25.4% | 13.2% | 10.6% | 41.7% | 88.1% |
| New Universe International Group Ltd ($8068) | 103.4% | 16.4% | 16.6% | 44.9% | 33.3% |
| China Water Affairs Group Ltd ($855) | 31.4% | 40.5% | 39.1% | 30.1% | 28.4% |
| |
|---|
| Median (18 companies) | 10.8% | 12.9% | 13.0% | 8.8% | 8.1% |
|---|
| CT Environmental Group Ltd ($1363) | 31.8% | 65.0% | 27.1% | 51.4% | 40.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Everbright International Ltd ($257) | 11.1% | 10.4% | 11.2% | 10.5% | 10.8% |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 7.4% | 7.1% | 6.8% | 7.8% | 8.8% |
| Dynagreen Environmental Protection Group Co Ltd ($1330) | | 11.4% | 9.0% | 8.5% | 8.6% |
| Dongjiang Environmental Co Ltd ($895) | 17.0% | 14.3% | 7.4% | 9.4% | 8.2% |
| New Universe International Group Ltd ($8068) | 5.8% | 6.3% | 6.8% | 8.9% | 8.1% |
| |
|---|
| Median (18 companies) | 2.3% | -0.7% | 1.1% | -0.6% | 2.7% |
|---|
| CT Environmental Group Ltd ($1363) | 34.4% | 25.9% | 20.5% | 20.8% | 20.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Water Affairs Group Ltd ($855) | 2.8x | 2.6x | 2.7x | 3.2x | 3.4x |
| Dynagreen Environmental Protection Group Co Ltd ($1330) | 0.4x | 3.2x | | | 3.2x |
| China Everbright International Ltd ($257) | 2.8x | 2.1x | 0.5x | 1.5x | 2.6x |
| Dongjiang Environmental Co Ltd ($895) | 1.0x | -1.7x | -1.5x | 0.9x | 2.5x |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 4.1x | 4.2x | 3.1x | 2.9x | 1.2x |
| |
|---|
| Median (11 companies) | 0.6x | 1.5x | 0.0x | -0.2x | -0.0x |
|---|
| CT Environmental Group Ltd ($1363) | 1.8x | 2.4x | 0.5x | 1.9x | 1.8x |
