China BlueChemical Ltd Net Income jumped on 688% in 2015 while EBITDA Margin decreased on 4.4 pp from 25.0% to 20.6%
30/03/2016 • About China BlueChemical Ltd (
$3983) • By InTwits
China BlueChemical Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 20.6% in 2015 vs. 25.0% in 2014 vs. 37.3% in 2011
- China BlueChemical Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 13.1%. At the same time it's a lot of higher than industry average of 7.3%.
- CAPEX is quite volatile: 550 in 2015, 1,059 in 2014, 1,794 in 2013, 1,531 in 2012, 1,929 in 2011
- The company has business model with low profitability: ROIC is at 7.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China BlueChemical Ltd ($3983) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 9,756 | 10,739 | 10,724 | 10,797 | 10,672 | -1.2% |
| Gross Profit | 3,268 | 3,306 | 3,223 | 2,686 | 1,746 | -35.0% |
| SG&A | 588 | 649 | 823 | 943 | 818 | -13.3% |
| EBITDA | 3,639 | 3,539 | 3,306 | 2,700 | 2,194 | -18.7% |
| Net Income | 1,986 | 1,810 | 1,647 | 105 | 830 | 688.0% |
Balance Sheet
|
|---|
| Cash | 2,836 | 2,564 | 2,934 | 5,526 | 5,314 | -3.8% |
| Short Term Debt | 0 | 0 | 0 | 705 | 1,390 | 97.1% |
| Long Term Debt | 425 | 0 | 31 | 1,951 | 900 | -53.9% |
Cash flow
|
|---|
| Capex | 1,929 | 1,531 | 1,794 | 1,059 | 550 | -48.0% |
Ratios
|
|---|
| Revenue growth | 42.1% | 10.1% | -0.1% | 0.7% | -1.2% | |
| EBITDA growth | 49.5% | -2.7% | -6.6% | -18.3% | -18.7% | |
| Gross Margin | 33.5% | 30.8% | 30.1% | 24.9% | 16.4% | -8.5% |
| EBITDA Margin | 37.3% | 33.0% | 30.8% | 25.0% | 20.6% | -4.4% |
| Net Income Margin | 20.4% | 16.9% | 15.4% | 1.0% | 7.8% | 6.8% |
| SG&A, % of revenue | 6.0% | 6.0% | 7.7% | 8.7% | 7.7% | -1.1% |
| CAPEX, % of revenue | 19.8% | 14.3% | 16.7% | 9.8% | 5.2% | -4.6% |
| ROIC | 21.0% | 19.1% | 16.4% | 11.4% | 7.8% | -3.6% |
| ROE | 17.5% | 14.3% | 12.0% | 0.8% | 6.0% | 5.3% |
| Net Debt/EBITDA | -0.7x | -0.7x | -0.9x | -1.1x | -1.4x | -0.3x |
Revenue and profitability
The company's Revenue decreased slightly on 1.2% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 4.4 pp from 25.0% to 20.6% in 2015.
Gross Margin decreased on 8.5 pp from 24.9% to 16.4% in 2015. SG&A as a % of Revenue decreased slightly on 1.1 pp from 8.7% to 7.7% in 2015.
Net Income marign increased on 6.8 pp from 0.98% to 7.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 5.2%. China BlueChemical Ltd's CAPEX/Revenue decreased on 9.1 pp from 14.3% in 2012 to 5.2% in 2015. For the last three years the average CAPEX/Revenue was 10.6%.
Return on investment
The company operates at low ROIC (7.80%) and ROE (6.04%). ROIC decreased on 3.6 pp from 11.4% to 7.8% in 2015. ROE increased on 5.3 pp from 0.76% to 6.0% in 2015.
Leverage (Debt)
Debt level is -1.4x Net Debt / EBITDA and 1.0x Debt / EBITDA. Net Debt / EBITDA dropped on 0.3x from -1.1x to -1.4x in 2015. Debt dropped on 13.8% in 2015 while cash decreased on 3.8% in 2015.
Appendix 1: Peers in Chemicals
Below we provide China BlueChemical Ltd benchmarking against other companies in Chemicals 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 |
|---|
| Bestway International Holdings Ltd ($718) | | -25.4% | -62.1% | 330.3% | 238.4% |
| China First Chemical Holdings Ltd ($2121) | | 6.2% | -6.8% | -18.0% | 72.5% |
| Strong Petrochemical Holdings Ltd ($852) | | 40.8% | 87.9% | -60.8% | 42.3% |
| Ko Yo Chemical Group Ltd ($827) | | -5.6% | -0.6% | 2.3% | 40.8% |
| China Sanjiang Fine Chemicals Co Ltd ($2198) | | 16.0% | 63.5% | -7.7% | 36.6% |
| |
|---|
| Median (26 companies) | 32.5% | 2.0% | 9.7% | 2.2% | -0.2% |
|---|
| China BlueChemical Ltd ($3983) | | 10.1% | -0.1% | 0.7% | -1.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 74.3% | 70.5% | 69.1% | 70.8% | 69.9% |
| China Flavors & Fragrances Co Ltd ($3318) | 41.3% | 46.8% | 48.6% | 47.8% | 48.9% |
| Bestway International Holdings Ltd ($718) | 5.4% | 5.1% | 4.6% | 8.6% | 40.4% |
| Bracell Ltd ($1768) | 40.1% | 30.5% | 37.3% | 37.3% | 38.4% |
| Infinity Chemical Holdings Co Ltd ($640) | 22.0% | 25.4% | 28.0% | 29.8% | 33.2% |
| |
|---|
| Median (26 companies) | 19.8% | 18.9% | 17.3% | 16.8% | 20.5% |
|---|
| China BlueChemical Ltd ($3983) | 33.5% | 30.8% | 30.1% | 24.9% | 16.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 66.4% | 63.8% | 59.1% | 60.0% | 58.3% |
| Bracell Ltd ($1768) | 30.1% | 22.3% | 30.8% | 38.2% | 35.9% |
| Yingde Gases Group Co Ltd ($2168) | 32.3% | 29.4% | 29.8% | 32.3% | 33.4% |
| Tiande Chemical Holdings Ltd ($609) | 21.7% | 25.5% | 27.3% | 25.1% | 27.8% |
| Century Sunshine Group Holdings Ltd ($509) | 15.5% | 24.2% | 28.1% | 27.6% | 26.1% |
| |
|---|
| Median (26 companies) | 15.2% | 12.3% | 11.8% | 10.7% | 11.8% |
|---|
| China BlueChemical Ltd ($3983) | 37.3% | 33.0% | 30.8% | 25.0% | 20.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Landing International Development Ltd ($582) | 27.9% | 7.2% | 29.6% | 419.5% | 247.4% |
| China Zenith Chemical Group Ltd ($362) | 36.8% | 147.3% | 55.7% | 67.4% | 152.2% |
| China Flavors & Fragrances Co Ltd ($3318) | 16.4% | 15.8% | 20.1% | 42.4% | 35.8% |
| Ko Yo Chemical Group Ltd ($827) | 31.3% | 45.2% | 43.2% | 20.7% | 27.5% |
| China XLX Fertiliser Ltd ($1866) | 13.0% | 30.1% | 41.1% | 32.1% | 22.0% |
| |
|---|
| Median (26 companies) | 8.3% | 6.8% | 8.5% | 5.4% | 8.2% |
|---|
| China BlueChemical Ltd ($3983) | 19.8% | 14.3% | 16.7% | 9.8% | 5.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 34.6% | 28.7% | 25.2% | 26.2% | 23.3% |
| Tiande Chemical Holdings Ltd ($609) | 24.4% | 26.2% | 29.4% | 20.7% | 20.6% |
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 4.5% | -6.9% | 8.1% | -2.4% | 16.5% |
| Century Sunshine Group Holdings Ltd ($509) | 3.5% | 11.3% | 15.9% | 16.4% | 13.3% |
| Infinity Chemical Holdings Co Ltd ($640) | 9.2% | 11.1% | 10.2% | 8.8% | 12.7% |
| |
|---|
| Median (26 companies) | 7.8% | 6.9% | 7.7% | 5.6% | 5.9% |
|---|
| China BlueChemical Ltd ($3983) | 21.0% | 19.1% | 16.4% | 11.4% | 7.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ko Yo Chemical Group Ltd ($827) | 7.4x | 8.8x | 22.0x | | 141.5x |
| China Sanjiang Fine Chemicals Co Ltd ($2198) | 2.4x | 2.2x | 4.6x | 18.1x | 13.5x |
| Ngai Hing Hong Co Ltd ($1047) | 4.8x | 11.7x | 5.3x | 5.4x | 5.3x |
| China XLX Fertiliser Ltd ($1866) | 2.4x | 2.6x | 5.1x | 5.8x | 5.1x |
| Strong Petrochemical Holdings Ltd ($852) | 1.2x | 7.2x | 4.0x | | 3.9x |
| |
|---|
| Median (23 companies) | 1.3x | 1.6x | 2.2x | 1.4x | 1.7x |
|---|
| China BlueChemical Ltd ($3983) | -0.7x | -0.7x | -0.9x | -1.1x | -1.4x |
