Branding China Group Ltd Net Income decreased on 8.9% in 2015 while Revenue increased on 4.5%
30/03/2016 • About Branding China Group Ltd (
$8219) • By InTwits
Branding China Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 17.0% in 2015 vs. 18.6% in 2014 vs. 36.3% in 2011
- Branding China Group Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.4%.
- The company has highly profitable business model: ROIC is at 12.0%
- It operates with high leverage: Net Debt/EBITDA is -2.7x while industry average is -6.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Branding China Group Ltd ($8219) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 132.0 | 146.9 | 271.3 | 303.9 | 317.6 | 4.5% |
| Gross Profit | 58.9 | 57.9 | 90.7 | 83.0 | 93.6 | 12.8% |
| SG&A | | 15.9 | 22.5 | 33.6 | 44.7 | 33.2% |
| EBITDA | 47.9 | 44.6 | 71.1 | 56.7 | 53.9 | -4.9% |
| Net Income | 34.5 | 32.4 | 50.9 | 41.0 | 37.4 | -8.9% |
Balance Sheet
|
|---|
| Cash | 52.9 | 96.2 | 116.7 | 109.6 | 144.6 | 31.9% |
| Short Term Debt | 0.0 | 15.3 | 15.0 | 20.0 | 0.0 | -100.0% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.2 | 0.8 | 0.6 | 1.0 | 2.9 | 195.5% |
Ratios
|
|---|
| Revenue growth | 57.7% | 11.3% | 84.6% | 12.0% | 4.5% | |
| EBITDA growth | 100.3% | -6.9% | 59.6% | -20.4% | -4.9% | |
| Gross Margin | 44.6% | 39.4% | 33.4% | 27.3% | 29.5% | 2.2% |
| EBITDA Margin | 36.3% | 30.3% | 26.2% | 18.6% | 17.0% | -1.7% |
| Net Income Margin | 26.1% | 22.0% | 18.8% | 13.5% | 11.8% | -1.7% |
| SG&A, % of revenue | | 10.8% | 8.3% | 11.0% | 14.1% | 3.0% |
| CAPEX, % of revenue | 0.1% | 0.5% | 0.2% | 0.3% | 0.9% | 0.6% |
| ROIC | 71.5% | 29.0% | 23.6% | 13.7% | 12.0% | -1.6% |
| ROE | 57.5% | 23.6% | 18.8% | 10.9% | 9.0% | -1.9% |
| Net Debt/EBITDA | -1.1x | -1.8x | -1.4x | -1.6x | -2.7x | -1.1x |
Revenue and profitability
Branding China Group Ltd's Revenue increased on 4.5% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.4 pp from 16.2% to 17.7% in 2015.
Gross Margin increased on 2.2 pp from 27.3% to 29.5% in 2015. SG&A as a % of Revenue increased on 3.0 pp from 11.0% to 14.1% in 2015.
Net Income marign decreased slightly on 1.7 pp from 13.5% to 11.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Branding China Group Ltd had CAPEX/Revenue of 0.92%. The company's CAPEX/Revenue showed almost no change from 2012 to 2015. It's average level of CAPEX/Revenue for the last three years was 0.49%.
Return on investment
The company operates at good ROIC (12.03%) while ROE is low (9.01%). ROIC decreased slightly on 1.6 pp from 13.7% to 12.0% in 2015. ROE decreased slightly on 1.9 pp from 10.9% to 9.0% in 2015.
Leverage (Debt)
The company paid down all the debt in 2015. Cash jumped on 31.9% in 2015.
Appendix 1: Peers in Advertising
Below we provide Branding China Group Ltd benchmarking against other companies in Advertising 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 |
|---|
| China Chuanglian Education Group Ltd ($2371) | | -40.5% | 332.3% | -21.8% | 26.5% |
| Dahe Media Co Ltd ($8243) | | 5.8% | -5.7% | -1.6% | 8.8% |
| Cinderella Media Group Ltd ($550) | | 7.1% | -63.6% | -89.2% | 4.9% |
| Clear Media Ltd ($100) | | 2.4% | 8.2% | 6.9% | 4.1% |
| Roadshow Holdings Ltd ($888) | | 13.4% | 9.7% | -0.5% | -10.3% |
| |
|---|
| Median (7 companies) | | 5.8% | 7.6% | -7.5% | 4.1% |
|---|
| Branding China Group Ltd ($8219) | | 11.3% | 84.6% | 12.0% | 4.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cinderella Media Group Ltd ($550) | 24.5% | 26.3% | 26.7% | 72.1% | 72.8% |
| China Chuanglian Education Group Ltd ($2371) | -114.2% | -2,833.2% | 74.2% | 68.5% | 64.3% |
| SEEC Media Group Ltd ($205) | 66.6% | 61.7% | 58.4% | 52.0% | 51.6% |
| Clear Media Ltd ($100) | 37.2% | 38.3% | 40.4% | 41.2% | 43.9% |
| Dahe Media Co Ltd ($8243) | 34.4% | 35.3% | 36.7% | 40.7% | 29.5% |
| |
|---|
| Median (6 companies) | 32.7% | 35.0% | 38.6% | 46.6% | 47.7% |
|---|
| Branding China Group Ltd ($8219) | 44.6% | 39.4% | 33.4% | 27.3% | 29.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Clear Media Ltd ($100) | 38.2% | 41.0% | 40.9% | 41.3% | 44.0% |
| Dahe Media Co Ltd ($8243) | 18.1% | 16.0% | 15.3% | 19.4% | 17.2% |
| SinoMedia Holding Ltd ($623) | 23.4% | 27.3% | 30.5% | 24.9% | 16.7% |
| Cinderella Media Group Ltd ($550) | 16.6% | 18.2% | 18.3% | 43.6% | 10.3% |
| China Chuanglian Education Group Ltd ($2371) | -146.2% | -2,821.1% | 50.5% | 36.2% | 7.7% |
| |
|---|
| Median (7 companies) | 18.1% | 18.2% | 26.3% | 24.9% | 10.3% |
|---|
| Branding China Group Ltd ($8219) | 36.3% | 30.3% | 26.2% | 18.6% | 17.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Clear Media Ltd ($100) | 0.8% | 0.6% | 0.5% | 0.6% | 28.0% |
| China Chuanglian Education Group Ltd ($2371) | 10.9% | 1.2% | 5.0% | 0.7% | 14.2% |
| Roadshow Holdings Ltd ($888) | 7.3% | 2.1% | 2.8% | 1.5% | 3.8% |
| Cinderella Media Group Ltd ($550) | 2.9% | 1.5% | 5.1% | 6.8% | 2.7% |
| SEEC Media Group Ltd ($205) | 1.2% | 0.9% | 0.4% | 1.1% | 1.3% |
| |
|---|
| Median (7 companies) | 2.8% | 1.2% | 2.8% | 1.3% | 2.7% |
|---|
| Branding China Group Ltd ($8219) | 0.1% | 0.5% | 0.2% | 0.3% | 0.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Clear Media Ltd ($100) | 9.4% | 9.2% | 10.8% | 12.4% | 14.4% |
| SinoMedia Holding Ltd ($623) | 35.1% | 34.8% | 33.8% | 20.8% | 9.6% |
| Dahe Media Co Ltd ($8243) | 8.1% | 6.9% | 5.3% | 6.9% | 6.8% |
| Cinderella Media Group Ltd ($550) | 24.7% | 24.6% | 6.7% | 2.3% | 2.7% |
| China Chuanglian Education Group Ltd ($2371) | -12.9% | -171.2% | 12.3% | 1.9% | -1.4% |
| |
|---|
| Median (7 companies) | 9.4% | 10.7% | 10.8% | 6.9% | 2.7% |
|---|
| Branding China Group Ltd ($8219) | 71.5% | 29.0% | 23.6% | 13.7% | 12.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dahe Media Co Ltd ($8243) | 1.1x | 1.3x | 1.7x | 2.3x | 3.0x |
| Clear Media Ltd ($100) | -1.7x | -2.1x | -1.3x | -1.4x | -0.9x |
| SinoMedia Holding Ltd ($623) | -2.4x | -3.2x | -2.0x | -1.6x | -1.9x |
| Cinderella Media Group Ltd ($550) | -1.1x | -1.1x | -3.1x | -5.5x | -14.1x |
| China Chuanglian Education Group Ltd ($2371) | | | -0.7x | -2.8x | -25.0x |
| |
|---|
| Median (5 companies) | -1.4x | -1.4x | -1.3x | -2.2x | -1.9x |
|---|
| Branding China Group Ltd ($8219) | -1.1x | -1.8x | -1.4x | -1.6x | -2.7x |
