China Gold International Resources Corp Ltd Net Income dropped on 121% in 2015 while Revenue jumped on 22.4%
30/03/2016 • About China Gold International Resources Corp Ltd (
$2099) • By InTwits
China Gold International Resources Corp Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Gold International Resources Corp Ltd doesn't have a profitable business model yet: 2015 ROIC is 1.5%
- China Gold International Resources Corp Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 84.1%. At the same time it's a lot of higher than industry average of 67.4%.
- CAPEX is quite volatile: 277 in 2015, 266 in 2014, 472 in 2013, 215 in 2012, 71.2 in 2011
- The company has potentially unprofitable business model: ROIC is at 1.5%
- It operates with high leverage: Net Debt/EBITDA is 7.3x while industry average is 3.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Gold International Resources Corp Ltd ($2099) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 311.3 | 332.4 | 302.6 | 277.8 | 339.9 | 22.4% |
| Gross Profit | 120.8 | 124.9 | 101.9 | 99.0 | 62.8 | -36.5% |
| SG&A | 17.4 | 25.0 | 25.7 | 25.1 | 23.8 | -4.9% |
| EBITDA | 147.4 | 138.7 | 115.8 | 131.5 | 114.4 | -12.9% |
| Net Income | 79.4 | 70.9 | 55.0 | 39.7 | -8.2 | -120.6% |
Balance Sheet
|
|---|
| Cash | 354.3 | 181.7 | 105.9 | 565.6 | 112.4 | -80.1% |
| Short Term Debt | 44.5 | 72.2 | 232.4 | 526.8 | 189.0 | -64.1% |
| Long Term Debt | 183.1 | 140.7 | 272.1 | 658.9 | 763.4 | 15.9% |
Cash flow
|
|---|
| Capex | 71.2 | 215.1 | 472.3 | 265.6 | 276.7 | 4.2% |
Ratios
|
|---|
| Revenue growth | 133.7% | 6.8% | -9.0% | -8.2% | 22.4% | |
| EBITDA growth | 112.7% | -5.9% | -16.5% | 13.5% | -12.9% | |
| Gross Margin | 38.8% | 37.6% | 33.7% | 35.6% | 18.5% | -17.1% |
| EBITDA Margin | 47.4% | 41.7% | 38.3% | 47.3% | 33.7% | -13.7% |
| Net Income Margin | 25.5% | 21.3% | 18.2% | 14.3% | -2.4% | -16.7% |
| SG&A, % of revenue | 5.6% | 7.5% | 8.5% | 9.0% | 7.0% | -2.0% |
| CAPEX, % of revenue | 22.9% | 64.7% | 156.1% | 95.6% | 81.4% | -14.2% |
| ROIC | 6.8% | 5.9% | 4.0% | 3.0% | 1.5% | -1.6% |
| ROE | 6.4% | 5.4% | 4.0% | 2.8% | -0.6% | -3.3% |
| Net Debt/EBITDA | -0.9x | 0.2x | 3.4x | 4.7x | 7.3x | 2.6x |
Revenue and profitability
China Gold International Resources Corp Ltd's Revenue surged on 22.4% in 2015. Revenue growth was financed by EBITDA margin decline. EBITDA Margin dropped on 13.7 pp from 47.3% to 33.7% in 2015.
Gross Margin dropped on 17.1 pp from 35.6% to 18.5% in 2015. SG&A as a % of Revenue decreased on 2.0 pp from 9.0% to 7.0% in 2015.
Net Income marign dropped on 16.7 pp from 14.3% to -2.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 81.4% in 2015. CAPEX/Revenue jumped on 16.7 pp from 64.7% in 2012 to 81.4% in 2015. Average CAPEX/Revenue for the last three years was 111%.To fuel this fast growth China Gold International Resources Corp Ltd made large investments to CAPEX (242% of EBITDA).
Return on investment
The company operates at low but positive ROIC (1.46%) and negative ROE (-0.57%). ROIC decreased slightly on 1.6 pp from 3.0% to 1.5% in 2015. ROE decreased on 3.3 pp from 2.8% to -0.57% in 2015.
Leverage (Debt)
Debt level is 7.3x Net Debt / EBITDA and 8.3x Debt / EBITDA. Net Debt / EBITDA surged on 2.6x from 4.7x to 7.3x in 2015. Debt dropped on 19.7% in 2015 while cash dropped on 80.1% in 2015.
Management team
Bing Liu is a China Gold International Resources Corp Ltd's CEO. Bing Liu has spent 4 years at the company. Derrick Zhang is a The company's CFO. Derrick Zhang has spent 7 years at the company.
Appendix 1: Peers in Mining
Below we provide China Gold International Resources Corp Ltd benchmarking against other companies in Mining 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 |
|---|
| Mongolia Energy Corp Ltd ($276) | | | 89.7% | -95.8% | 2,361.6% |
| REX Global Entertainment Holdings Ltd ($164) | | -12.3% | 81.6% | -15.5% | 96.4% |
| Hengxing Gold Holding Co Ltd ($2303) | | | | 3,467.3% | 78.0% |
| Zijin Mining Group Co Ltd ($2899) | | 21.6% | 2.5% | 18.1% | 26.9% |
| China Hongqiao Group Ltd ($1378) | | 5.0% | 18.5% | 22.7% | 22.2% |
| |
|---|
| Median (40 companies) | 68.5% | 5.2% | 2.4% | -5.1% | -13.6% |
|---|
| China Gold International Resources Corp Ltd ($2099) | | | -9.0% | -8.2% | 22.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sino Prosper Group Holdings Ltd ($766) | -6.5% | 2.5% | 5.1% | 39.6% | 93.0% |
| REX Global Entertainment Holdings Ltd ($164) | 15.4% | -15.8% | -7.8% | -0.8% | 88.6% |
| China Billion Resources Ltd ($274) | 20.3% | 71.4% | 47.2% | 73.4% | 79.7% |
| Sun International Resources Ltd ($8029) | 77.6% | 83.2% | 73.1% | 64.8% | 69.4% |
| Timeless Software Ltd ($8028) | 19.2% | 17.7% | 48.5% | 29.4% | 42.1% |
| |
|---|
| Median (41 companies) | 19.2% | 13.4% | 13.8% | 15.4% | 26.9% |
|---|
| China Gold International Resources Corp Ltd ($2099) | | 37.6% | 33.7% | 35.6% | 18.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| G-Resources Group Ltd ($1051) | | | 54.5% | 53.4% | 58.3% |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 73.1% | 70.0% | 64.6% | 59.6% | 51.3% |
| Timeless Software Ltd ($8028) | -70.8% | -113.1% | 24.7% | -13.7% | 46.1% |
| Hengxing Gold Holding Co Ltd ($2303) | | | -766.2% | 24.5% | 43.9% |
| Sino Prosper Group Holdings Ltd ($766) | -127.2% | -138.6% | -138.2% | -378.4% | 42.9% |
| |
|---|
| Median (41 companies) | 6.4% | 4.7% | 7.5% | 4.7% | 5.5% |
|---|
| China Gold International Resources Corp Ltd ($2099) | | 41.7% | 38.3% | 47.3% | 33.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Mongolia Energy Corp Ltd ($276) | | 8,006.5% | 1,061.7% | 30,555.4% | 1,973.0% |
| Kaz Minerals ($847) | 19.8% | 36.6% | 136.5% | 168.8% | 168.7% |
| Chinalco Mining Corp International ($3668) | | | | | 115.6% |
| China Dynamics Holdings Ltd ($476) | 1.6% | 1.8% | 0.0% | 1.0% | 113.8% |
| MMG Ltd ($1208) | 17.1% | 25.7% | 22.6% | 41.9% | 100.4% |
| |
|---|
| Median (41 companies) | 15.6% | 17.0% | 15.7% | 13.4% | 11.9% |
|---|
| China Gold International Resources Corp Ltd ($2099) | | 64.7% | 156.1% | 95.6% | 81.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CGN Mining Co Ltd ($1164) | -6.4% | 2.6% | 3.3% | 7.9% | 16.7% |
| United Co RUSAL PLC ($486) | 7.5% | 0.3% | -9.0% | 6.3% | 12.3% |
| Timeless Software Ltd ($8028) | -18.0% | -29.1% | 7.3% | -4.6% | 11.6% |
| China Hongqiao Group Ltd ($1378) | 44.6% | 24.8% | 17.0% | 14.1% | 10.6% |
| Hengxing Gold Holding Co Ltd ($2303) | | -7.2% | -8.1% | 0.0% | 8.6% |
| |
|---|
| Median (42 companies) | 3.3% | 0.9% | 2.7% | 0.0% | 1.2% |
|---|
| China Gold International Resources Corp Ltd ($2099) | | 5.9% | 4.0% | 3.0% | 1.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chinalco Mining Corp International ($3668) | | | | | 25.0x |
| MMG Ltd ($1208) | -0.0x | 2.1x | 2.0x | 10.2x | 20.2x |
| Kaz Minerals ($847) | 0.6x | 2.4x | 2.9x | 5.5x | 18.7x |
| Aluminum Corp of China Ltd ($2600) | 7.7x | 139.2x | 8.5x | | 18.0x |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 1.5x | 1.5x | 4.1x | 6.4x | 13.5x |
| |
|---|
| Median (27 companies) | 1.1x | 2.1x | 1.9x | 4.4x | 3.4x |
|---|
| China Gold International Resources Corp Ltd ($2099) | | 0.2x | 3.4x | 4.7x | 7.3x |
