Shanghai Fosun Pharmaceutical Group Co Ltd reports 22.5% EBITDA growth and 4.7% Revenue growth
29/03/2016 • About Shanghai Fosun Pharmaceutical Group Co Ltd (
$2196) • By InTwits
Shanghai Fosun Pharmaceutical Group Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Shanghai Fosun Pharmaceutical Group Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.6%. At the same time it's a lot of higher than industry average of 8.4%.
- CAPEX is quite volatile: 327 in 2015, 1,270 in 2014, 252 in 2013, 365 in 2012, 449 in 2011
- The company has business model with low profitability: ROIC is at 8.1%
- It operates with high leverage: Net Debt/EBITDA is 2.3x while industry average is 0.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 6,433 | 7,278 | 9,921 | 11,938 | 12,502 | 4.7% |
| Gross Profit | 2,441 | 3,151 | 4,378 | 5,220 | 6,194 | 18.7% |
| SG&A | 1,907 | 2,252 | 2,827 | 3,463 | 4,051 | 17.0% |
| EBITDA | 1,508 | 1,923 | 2,273 | 2,655 | 3,253 | 22.5% |
| Net Income | 1,166 | 1,564 | 1,583 | 2,113 | 2,460 | 16.4% |
Balance Sheet
|
|---|
| Cash | 2,428 | 4,172 | 2,416 | 3,010 | 3,349 | 11.2% |
| Short Term Debt | 2,177 | 1,375 | 1,424 | 4,939 | 7,323 | 48.3% |
| Long Term Debt | 3,917 | 4,280 | 4,200 | 3,857 | 3,572 | -7.4% |
Cash flow
|
|---|
| Capex | 797 | 1,161 | 1,040 | 1,119 | 1,236 | 10.4% |
Ratios
|
|---|
| Revenue growth | 42.0% | 13.1% | 36.3% | 20.3% | 4.7% | |
| EBITDA growth | 443.3% | 27.5% | 18.2% | 16.8% | 22.5% | |
| Gross Margin | 38.0% | 43.3% | 44.1% | 43.7% | 49.5% | 5.8% |
| EBITDA Margin | 23.4% | 26.4% | 22.9% | 22.2% | 26.0% | 3.8% |
| Net Income Margin | 18.1% | 21.5% | 16.0% | 17.7% | 19.7% | 2.0% |
| SG&A, % of revenue | 29.6% | 30.9% | 28.5% | 29.0% | 32.4% | 3.4% |
| CAPEX, % of revenue | 12.4% | 15.9% | 10.5% | 9.4% | 9.9% | 0.5% |
| ROIC | 7.5% | 7.8% | 7.8% | 7.6% | 8.1% | 0.6% |
| ROE | 12.9% | 13.5% | 11.0% | 13.2% | 14.2% | 0.9% |
| Net Debt/EBITDA | 2.4x | 0.8x | 1.4x | 2.2x | 2.3x | 0.1x |
Revenue and profitability
The company's Revenue increased on 4.7% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 3.3 pp from 19.9% to 16.6% in 2015.
Gross Margin increased on 5.8 pp from 43.7% to 49.5% in 2015. SG&A as a % of Revenue increased on 3.4 pp from 29.0% to 32.4% in 2015.
Net Income marign increased slightly on 2.0 pp from 17.7% to 19.7% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 9.9%. Shanghai Fosun Pharmaceutical Group Co Ltd's CAPEX/Revenue decreased on 6.1 pp from 15.9% in 2012 to 9.9% in 2015. Average CAPEX/Revenue for the last three years was 9.9%.
Return on investment
The company operates at good ROE (14.16%) while ROIC is low (8.15%). ROIC increased slightly on 0.56 pp from 7.6% to 8.1% in 2015. ROE increased slightly on 0.91 pp from 13.2% to 14.2% in 2015.
Leverage (Debt)
Debt level is 2.3x Net Debt / EBITDA and 3.3x Debt / EBITDA. Net Debt / EBITDA jumped on 0.1x from 2.2x to 2.3x in 2015. Debt surged on 23.9% in 2015 while cash jumped on 11.2% in 2015.
Appendix 1: Peers in Pharmaceuticals
Below we provide Shanghai Fosun Pharmaceutical Group Co Ltd benchmarking against other companies in Pharmaceuticals 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 |
|---|
| Hong Kong Life Sciences and Technology Group Ltd ($8085) | | -10.0% | -45.4% | 1,636.5% | -52.9% |
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | | 15.1% | -99.9% | 480.0% | -93.1% |
| United Gene High-Tech Group Ltd ($399) | | -71.8% | -60.5% | 196.0% | 14.2% |
| China Traditional Chinese Medicine Co Ltd ($570) | | 22.3% | 35.2% | 90.0% | 40.0% |
| Dragonite International Ltd ($329) | | -10.5% | 13.5% | 64.8% | -26.7% |
| |
|---|
| Median (42 companies) | 12.7% | 15.7% | 13.5% | 15.3% | 3.3% |
|---|
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | | 13.1% | 36.3% | 20.3% | 4.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Luye Pharma Group Ltd ($2186) | 83.0% | 83.5% | 83.6% | 81.0% | 81.4% |
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 83.9% | 82.0% | 81.5% | 80.9% | |
| Consun Pharmaceutical Group Ltd ($1681) | 75.5% | 75.7% | 79.1% | 78.3% | |
| Sino Biopharmaceutical Ltd ($1177) | 78.5% | 78.5% | 77.5% | 76.4% | |
| China Health Group Inc ($8225) | 38.7% | 43.4% | 33.6% | 76.2% | 75.7% |
| |
|---|
| Median (40 companies) | 38.7% | 39.1% | 37.2% | 50.0% | 50.0% |
|---|
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | 38.0% | 43.3% | 44.1% | 43.7% | 49.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Resources Holdings Ltd ($899) | 3.5% | -80.8% | 25.1% | 113.7% | |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 48.4% | 38.8% | 65.4% | 70.9% | 93.3% |
| Pak Fah Yeow International Ltd ($239) | 28.7% | 33.9% | 28.4% | 52.4% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 29.7% | 41.3% | 45.4% | 47.5% | 49.1% |
| Real Nutriceutical Group Ltd ($2010) | 45.6% | 42.8% | 43.4% | 46.0% | |
| |
|---|
| Median (41 companies) | 17.0% | 18.7% | 19.7% | 21.4% | 18.3% |
|---|
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | 23.4% | 26.4% | 22.9% | 22.2% | 26.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 0.2% | | 11,100.0% | 103.4% | 0.0% |
| Extrawell Pharmaceutical Holdings Ltd ($858) | 5.7% | 1.7% | 20.6% | 92.4% | 3.6% |
| Asia Resources Holdings Ltd ($899) | 12.2% | 4.4% | 8.1% | 92.0% | |
| Lijun International Pharmaceutical Holding Co Ltd ($2005) | 19.5% | 16.8% | 52.4% | 39.6% | |
| Hao Wen Holdings Ltd ($8019) | 6.4% | 30.0% | 2.3% | 38.2% | |
| |
|---|
| Median (41 companies) | 10.3% | 8.2% | 8.1% | 7.4% | 4.3% |
|---|
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | 12.4% | 15.9% | 10.5% | 9.4% | 9.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 18.5% | 16.7% | 20.8% | 33.0% | |
| Sino Biopharmaceutical Ltd ($1177) | 19.9% | 26.2% | 26.8% | 26.5% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | | 25.3% | 27.5% | 23.8% | 25.9% |
| Lee's Pharmaceutical Holdings Ltd ($950) | 31.3% | 26.1% | 22.0% | 22.4% | 22.7% |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 14.3% | 13.7% | 18.3% | 22.0% | 25.4% |
| |
|---|
| Median (42 companies) | 9.1% | 12.4% | 9.3% | 12.2% | 9.8% |
|---|
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | 7.5% | 7.8% | 7.8% | 7.6% | 8.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China NT Pharma Group Co Ltd ($1011) | 0.4x | | | 7.2x | -0.4x |
| United Laboratories International Holdings Ltd/The ($3933) | 4.4x | 6.5x | 4.6x | 4.2x | 4.0x |
| Lansen Pharmaceutical Holdings Ltd ($503) | 0.9x | 1.7x | 2.8x | 3.4x | |
| China Grand Pharmaceutical and Healthcare Holdings Ltd ($512) | 2.5x | 5.4x | 4.0x | 3.4x | |
| Shandong Xinhua Pharmaceutical Co Ltd ($719) | 1.4x | 3.5x | 3.4x | 2.8x | |
| |
|---|
| Median (34 companies) | -0.8x | -0.4x | -0.5x | -0.6x | -0.6x |
|---|
| Shanghai Fosun Pharmaceutical Group Co Ltd ($2196) | 2.4x | 0.8x | 1.4x | 2.2x | 2.3x |
