Guangshen Railway Co Ltd Net Income surged on 61.8% in 2015 and EBITDA Margin increased slightly on 1.1 pp from 17.0% to 18.1%
29/03/2016 • About Guangshen Railway Co Ltd (
$525) • By InTwits
Guangshen Railway Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Guangshen Railway Co Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.5%. At the same time it's a lot of higher than industry average of 19.2%.
- CAPEX is quite volatile: 181 in FY2015, 258 in FY2014, 307 in FY2013, 153 in FY2012, 101 in FY2011
- The company has potentially unprofitable business model: ROIC is at 5.1%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Guangshen Railway Co Ltd ($525) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 14,691 | 15,092 | 15,801 | 14,710 | 15,725 | 6.9% |
| Gross Profit | | | | 1,355 | 1,975 | 45.8% |
| SG&A | | | | 282 | 268 | -4.9% |
| EBITDA | 3,843 | 3,170 | 3,172 | 2,496 | 2,847 | 14.1% |
| Net Income | 1,804 | 1,319 | 1,274 | 662 | 1,071 | 61.8% |
Balance Sheet
|
|---|
| Cash | 1,367 | 675 | 413 | 1,769 | 2,221 | 25.5% |
| Short Term Debt | 0 | 0 | 3,493 | 0 | 0 | |
| Long Term Debt | 3,479 | 3,485 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 943 | 1,836 | 1,377 | 1,000 | 1,292 | 29.3% |
Ratios
|
|---|
| Revenue growth | 8.9% | 2.7% | 4.7% | -6.9% | 6.9% | |
| EBITDA growth | 12.1% | -17.5% | 0.1% | -21.3% | 14.1% | |
| Gross Margin | | | | 9.2% | 12.6% | 3.3% |
| EBITDA Margin | 26.2% | 21.0% | 20.1% | 17.0% | 18.1% | 1.1% |
| Net Income Margin | 12.3% | 8.7% | 8.1% | 4.5% | 6.8% | 2.3% |
| SG&A, % of revenue | | | | 1.9% | 1.7% | -0.2% |
| CAPEX, % of revenue | 6.4% | 12.2% | 8.7% | 6.8% | 8.2% | 1.4% |
| ROIC | 8.6% | 6.0% | 5.8% | 3.7% | 5.1% | 1.5% |
| ROE | 7.3% | 5.1% | 4.8% | 2.5% | 4.0% | 1.5% |
| Net Debt/EBITDA | 0.5x | 0.9x | 1.0x | -0.7x | -0.8x | -0.1x |
Revenue and profitability
Guangshen Railway Co Ltd's Revenue increased on 6.9% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.67 pp from 12.7% to 13.3% in FY2015.
Gross Margin increased on 3.3 pp from 9.2% to 12.6% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign increased on 2.3 pp from 4.5% to 6.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 8.2%. CAPEX/Revenue decreased on 3.9 pp from 12.2% in 2012 to 8.2% in 2015. For the last three years the average CAPEX/Revenue was 7.9%.
Return on investment
The company operates at low ROIC (5.15%) and ROE (3.95%). ROIC increased slightly on 1.5 pp from 3.7% to 5.1% in 2015. ROE increased slightly on 1.5 pp from 2.5% to 4.0% in 2015.
Leverage (Debt)
The company has no debt. Cash surged on 25.5% in 2015.
Appendix 1: Peers in Transportation
Below we provide Guangshen Railway Co Ltd benchmarking against other companies in Transportation 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 |
|---|
| Noble Century Investment Holdings Ltd ($2322) | | | | | 2,388.3% |
| Changan Minsheng APLL Logistics Co Ltd ($1292) | | 10.9% | 27.9% | 15.0% | 13.3% |
| Kwoon Chung Bus Holdings Ltd ($306) | | -8.6% | 7.9% | 5.5% | 7.9% |
| Chu Kong Shipping Enterprise Group Co Ltd ($560) | | 9.4% | 6.9% | 12.9% | 5.1% |
| MTR Corp Ltd ($66) | | 6.9% | 8.3% | 3.7% | 3.8% |
| |
|---|
| Median (25 companies) | -12.3% | 6.9% | 3.5% | 5.5% | -4.6% |
|---|
| Guangshen Railway Co Ltd ($525) | | 2.7% | 4.7% | -6.9% | 6.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CIG Yangtze Ports PLC ($8233) | 51.0% | 51.3% | 44.8% | 46.6% | 48.7% |
| Qinhuangdao Port Co Ltd ($3369) | 43.2% | 43.1% | 42.4% | 43.3% | 40.5% |
| Kwoon Chung Bus Holdings Ltd ($306) | 17.6% | 18.9% | 20.4% | 22.7% | 26.8% |
| Chu Kong Shipping Enterprise Group Co Ltd ($560) | 21.5% | 23.1% | 25.1% | 24.1% | 23.1% |
| Tianjin Port Development Holdings Ltd ($3382) | 21.7% | 22.5% | 18.4% | 13.6% | 22.7% |
| |
|---|
| Median (21 companies) | 18.7% | 13.0% | 10.9% | 10.8% | 13.0% |
|---|
| Guangshen Railway Co Ltd ($525) | | | | 9.2% | 12.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| MTR Corp Ltd ($66) | 49.1% | 42.7% | 37.6% | 45.2% | 41.6% |
| Qinhuangdao Port Co Ltd ($3369) | 45.3% | 46.0% | 44.6% | 46.5% | 41.1% |
| CIG Yangtze Ports PLC ($8233) | 29.9% | 30.2% | 27.6% | 38.5% | 39.5% |
| China Shipping Development Co Ltd ($1138) | 24.7% | 12.5% | 3.0% | 24.7% | 26.7% |
| Kwoon Chung Bus Holdings Ltd ($306) | 15.4% | 13.3% | 16.1% | 20.7% | 26.1% |
| |
|---|
| Median (25 companies) | 15.4% | 9.4% | 7.1% | 7.5% | 10.0% |
|---|
| Guangshen Railway Co Ltd ($525) | 26.2% | 21.0% | 20.1% | 17.0% | 18.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Great Harvest Maeta Group Holdings Ltd ($3683) | 150.5% | 4.0% | 6.1% | 40.7% | 164.7% |
| MTR Corp Ltd ($66) | 30.0% | 31.1% | 34.5% | 30.8% | 52.0% |
| CIG Yangtze Ports PLC ($8233) | 31.4% | 17.8% | 24.8% | 2.1% | 50.7% |
| Transport International Holdings Ltd ($62) | 10.9% | 7.9% | 16.2% | 16.0% | 26.2% |
| Qinhuangdao Port Co Ltd ($3369) | 47.2% | 57.9% | 35.8% | 46.3% | 21.0% |
| |
|---|
| Median (25 companies) | 11.3% | 7.8% | 9.2% | 7.4% | 9.2% |
|---|
| Guangshen Railway Co Ltd ($525) | 6.4% | 12.2% | 8.7% | 6.8% | 8.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Changan Minsheng APLL Logistics Co Ltd ($1292) | 34.2% | 21.1% | 20.9% | 19.1% | 19.3% |
| Kwoon Chung Bus Holdings Ltd ($306) | 6.9% | 3.6% | 5.7% | 9.2% | 14.6% |
| SITC International Holdings Co Ltd ($1308) | 9.0% | 8.2% | 9.1% | 9.1% | 11.2% |
| CIG Yangtze Ports PLC ($8233) | 4.3% | 4.9% | 5.7% | 11.0% | 11.1% |
| Kerry Logistics Network Ltd ($636) | 11.3% | 12.0% | 13.4% | 10.5% | 10.9% |
| |
|---|
| Median (25 companies) | 5.0% | 3.2% | 2.8% | 3.1% | 5.0% |
|---|
| Guangshen Railway Co Ltd ($525) | 8.6% | 6.0% | 5.8% | 3.7% | 5.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jinhui Holdings Co Ltd ($137) | 2.8x | 5.0x | 4.2x | 17.5x | 19.6x |
| China Shipping Development Co Ltd ($1138) | 7.2x | 20.2x | 92.8x | 12.8x | 11.4x |
| Pacific Basin Shipping Ltd ($2343) | 0.8x | 2.1x | 4.6x | | 4.7x |
| AMS Public Transport Holdings Ltd ($77) | 0.7x | 1.2x | 11.6x | 7.7x | 4.5x |
| Orient Overseas International Ltd ($316) | 2.0x | 2.7x | 5.1x | 3.4x | 3.9x |
| |
|---|
| Median (18 companies) | 0.2x | 1.6x | 1.7x | 1.6x | 1.3x |
|---|
| Guangshen Railway Co Ltd ($525) | 0.5x | 0.9x | 1.0x | -0.7x | -0.8x |
