IPE Group Ltd EBITDA dropped on 13.0% in 2015 and Revenue dropped on 11.8%
29/03/2016 • About IPE Group Ltd (
$929) • By InTwits
IPE Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- IPE Group Ltd is a company in decline: 2015 revenue growth was -11.8%, 5 years revenue CAGR was -3.6%
- IPE Group Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.5%. At the same time it's a lot of higher than industry average of 7.8%.
- CAPEX is quite volatile: 37.8 in 2015, 73.2 in 2014, 98.5 in 2013, 91.2 in 2012, 6.1 in 2011
- The company has potentially unprofitable business model: ROIC is at 5.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
IPE Group Ltd ($929) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 991.8 | 974.7 | 878.1 | 994.0 | 877.2 | -11.8% |
| Gross Profit | 198.6 | 211.1 | 164.5 | 278.4 | 244.9 | -12.0% |
| SG&A | | 126.8 | 135.7 | 136.4 | 124.3 | -8.9% |
| EBITDA | 246.5 | 249.4 | 197.7 | 293.1 | 254.9 | -13.0% |
| Net Income | 49.8 | 70.5 | 1.8 | 94.8 | 86.1 | -9.2% |
Balance Sheet
|
|---|
| Cash | 438.3 | 499.9 | 755.3 | 753.9 | 697.0 | -7.5% |
| Short Term Debt | 552.6 | 434.6 | 426.9 | 448.0 | 481.5 | 7.5% |
| Long Term Debt | 8.5 | 16.9 | 279.9 | 92.7 | 0.0 | -100.0% |
Cash flow
|
|---|
| Capex | 70.7 | 61.7 | 117.1 | 122.0 | 116.3 | -4.7% |
Ratios
|
|---|
| Revenue growth | -5.9% | -1.7% | -9.9% | 13.2% | -11.8% | |
| EBITDA growth | -21.6% | 1.2% | -20.7% | 48.2% | -13.0% | |
| Gross Margin | 20.0% | 21.7% | 18.7% | 28.0% | 27.9% | -0.1% |
| EBITDA Margin | 24.9% | 25.6% | 22.5% | 29.5% | 29.1% | -0.4% |
| Net Income Margin | 5.0% | 7.2% | 0.2% | 9.5% | 9.8% | 0.3% |
| SG&A, % of revenue | | 13.0% | 15.4% | 13.7% | 14.2% | 0.4% |
| CAPEX, % of revenue | 7.1% | 6.3% | 13.3% | 12.3% | 13.3% | 1.0% |
| ROIC | 4.4% | 4.4% | 1.4% | 6.4% | 5.6% | -0.8% |
| ROE | 3.9% | 5.2% | 0.1% | 6.5% | 5.9% | -0.6% |
| Net Debt/EBITDA | 0.5x | -0.2x | -0.2x | -0.7x | -0.8x | -0.1x |
Revenue and profitability
The company's Revenue dropped on 11.8% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.71 pp from 9.5% to 10.2% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 13.3% in 2015. CAPEX/Revenue increased on 6.9 pp from 6.3% in 2012 to 13.3% in 2015. It's average CAPEX/Revenue for the last three years was 13.0%.
Return on investment
The company operates at low ROIC (5.63%) and ROE (5.90%). ROIC decreased slightly on 0.76 pp from 6.4% to 5.6% in 2015. ROE decreased slightly on 0.58 pp from 6.5% to 5.9% in 2015.
Leverage (Debt)
Debt level is -0.8x Net Debt / EBITDA and 1.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.1x from -0.7x to -0.8x in 2015. Debt dropped on 10.9% in 2015 while cash decreased on 7.5% in 2015.
Appendix 1: Peers in Miscellaneous Manufactur
Below you can find IPE Group Ltd benchmarking vs. other companies in Miscellaneous Manufactur 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 |
|---|
| Karrie International Hldgs ($1050) | | -11.6% | 0.1% | -11.3% | 27.4% |
| Sunny Optical Technology Group Co Ltd ($2382) | | 59.5% | 45.9% | 45.0% | 26.9% |
| TK Group Holdings Ltd ($2283) | | 40.2% | 9.3% | 11.8% | 20.0% |
| Zhuzhou CSR Times Electric Co Ltd ($3898) | | 1.5% | 22.2% | 43.2% | 11.7% |
| Time Watch Investments Ltd ($2033) | | 28.2% | 25.4% | 25.6% | 10.4% |
| |
|---|
| Median (22 companies) | 18.6% | -7.1% | 0.1% | 6.7% | -4.7% |
|---|
| IPE Group Ltd ($929) | | -1.7% | -9.9% | 13.2% | -11.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Man Sang International Ltd ($938) | 34.7% | 42.4% | 32.8% | 60.3% | 78.6% |
| Time Watch Investments Ltd ($2033) | 58.5% | 60.2% | 60.6% | 65.0% | 68.1% |
| China Environmental Energy Investment Ltd ($986) | 21.0% | 14.0% | 1.2% | 9.0% | 49.2% |
| Lee & Man Chemical Co Ltd ($746) | 46.7% | 34.3% | 35.7% | 41.9% | 39.6% |
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 35.0% | 33.2% | 35.1% | 37.4% | 38.7% |
| |
|---|
| Median (21 companies) | 21.0% | 19.7% | 20.8% | 23.4% | 21.7% |
|---|
| IPE Group Ltd ($929) | 20.0% | 21.7% | 18.7% | 28.0% | 27.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lee & Man Chemical Co Ltd ($746) | 42.8% | 30.4% | 31.3% | 38.4% | 37.6% |
| Man Sang International Ltd ($938) | 18.7% | 24.9% | 15.4% | 37.0% | 33.8% |
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 19.5% | 18.4% | 19.8% | 20.6% | 24.2% |
| Time Watch Investments Ltd ($2033) | 16.8% | 17.6% | 16.8% | 19.4% | 20.5% |
| TK Group Holdings Ltd ($2283) | 22.1% | 21.4% | 18.9% | 17.9% | 17.2% |
| |
|---|
| Median (22 companies) | 10.2% | 8.0% | 8.2% | 9.5% | 7.0% |
|---|
| IPE Group Ltd ($929) | 24.9% | 25.6% | 22.5% | 29.5% | 29.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Environmental Energy Investment Ltd ($986) | 77.7% | 6.1% | 0.4% | 17.9% | 47.6% |
| Lee & Man Chemical Co Ltd ($746) | 1.4% | 5.8% | 51.1% | 33.7% | 22.8% |
| China International Marine Containers Group Co Ltd ($2039) | 4.7% | 3.9% | 12.1% | 18.5% | 21.2% |
| China Aerospace International Holdings Ltd ($31) | 3.9% | 5.1% | 6.3% | 6.6% | 7.9% |
| TK Group Holdings Ltd ($2283) | 8.9% | 13.3% | 8.1% | 13.7% | 7.6% |
| |
|---|
| Median (22 companies) | 5.0% | 4.7% | 4.2% | 4.2% | 4.3% |
|---|
| IPE Group Ltd ($929) | 7.1% | 6.3% | 13.3% | 12.3% | 13.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Time Watch Investments Ltd ($2033) | 30.5% | 34.5% | 27.1% | 27.8% | 27.9% |
| TK Group Holdings Ltd ($2283) | 34.0% | 36.8% | 31.1% | 29.4% | 27.6% |
| Zhuzhou CSR Times Electric Co Ltd ($3898) | 21.4% | 16.9% | 17.7% | 20.0% | 21.1% |
| Sunny Optical Technology Group Co Ltd ($2382) | 12.2% | 19.7% | 17.8% | 16.5% | 19.4% |
| CSR Corp Ltd ($1766) | 13.4% | 11.1% | 11.2% | 15.3% | 11.7% |
| |
|---|
| Median (22 companies) | 8.0% | 4.2% | 4.4% | 3.9% | 1.5% |
|---|
| IPE Group Ltd ($929) | 4.4% | 4.4% | 1.4% | 6.4% | 5.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Continental Holdings Ltd ($513) | 8.3x | | 20.1x | 92.9x | 4,203.6x |
| South China China Ltd ($413) | 2.3x | | 37.5x | 2,842.3x | 27.3x |
| China International Marine Containers Group Co Ltd ($2039) | 2.8x | 4.0x | 4.7x | 5.8x | 9.8x |
| VS International Group Ltd ($1002) | 8.6x | 5.1x | 6.5x | 4.4x | 3.3x |
| Lee & Man Chemical Co Ltd ($746) | -0.3x | -0.2x | 1.5x | 2.2x | 2.5x |
| |
|---|
| Median (19 companies) | -0.3x | -0.3x | -0.3x | 0.1x | -0.3x |
|---|
| IPE Group Ltd ($929) | 0.5x | -0.2x | -0.2x | -0.7x | -0.8x |
