China Ruifeng Renewable Energy Ltd reports 346% CAPEX growth while 22.3% Revenue decline
30/03/2016 • About China Ruifeng Renewable Energy Ltd (
$527) • By InTwits
China Ruifeng Renewable Energy Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Ruifeng Renewable Energy Ltd is a company in decline: 2015 revenue growth was -22.3%, 5 years revenue CAGR was -17.1%
- EBITDA Margin is quite volatile: 78.3% in 2015, 88.0% in 2014, 37.2% in 2013, 9.1% in 2012, 13.4% in 2011
- China Ruifeng Renewable Energy Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 23.0%. At the same time it's in pair with industry average of 20.3%.
- CAPEX is quite volatile: 192 in 2015, 43.0 in 2014, 217 in 2013, 14.8 in 2012, 15.6 in 2011
- The company has potentially unprofitable business model: ROIC is at 3.2%
- It operates with high leverage: Net Debt/EBITDA is 7.3x while industry average is 0.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Ruifeng Renewable Energy Ltd ($527) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 750.3 | 271.3 | 603.3 | 405.3 | 314.7 | -22.3% |
| Gross Profit | 139.5 | 43.5 | 143.1 | 197.9 | 121.1 | -38.8% |
| SG&A | 70.9 | 43.0 | 60.2 | 36.1 | 81.0 | 124.2% |
| EBITDA | 100.4 | 24.8 | 224.4 | 356.7 | 246.4 | -30.9% |
| Net Income | 91.5 | -167.0 | 23.5 | -150.8 | -84.4 | -44.0% |
Balance Sheet
|
|---|
| Cash | 82.7 | 160.4 | 135.0 | 175.6 | 143.7 | -18.1% |
| Short Term Debt | 105.4 | 544.1 | 263.7 | 479.5 | 357.9 | -25.4% |
| Long Term Debt | 378.2 | 23.0 | 1,420.5 | 1,456.0 | 1,591.3 | 9.3% |
Cash flow
|
|---|
| Capex | 15.6 | 14.8 | 216.8 | 43.0 | 191.5 | 345.7% |
Ratios
|
|---|
| Revenue growth | -6.7% | -63.8% | 122.4% | -32.8% | -22.3% | |
| EBITDA growth | -23.4% | -75.3% | 806.0% | 59.0% | -30.9% | |
| Gross Margin | 18.6% | 16.0% | 23.7% | 48.8% | 38.5% | -10.3% |
| EBITDA Margin | 13.4% | 9.1% | 37.2% | 88.0% | 78.3% | -9.7% |
| Net Income Margin | 12.2% | -61.5% | 3.9% | -37.2% | -26.8% | 10.4% |
| SG&A, % of revenue | 9.5% | 15.9% | 10.0% | 8.9% | 25.7% | 16.8% |
| CAPEX, % of revenue | 2.1% | 5.5% | 35.9% | 10.6% | 60.9% | 50.2% |
| ROIC | 9.8% | 0.7% | 4.4% | 7.2% | 3.2% | -4.0% |
| ROE | 30.2% | -48.4% | 6.5% | -38.9% | -19.6% | 19.2% |
| Net Debt/EBITDA | 4.0x | 16.4x | 6.9x | 4.9x | 7.3x | 2.4x |
Revenue and profitability
China Ruifeng Renewable Energy Ltd's Revenue dropped on 22.3% in 2015. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 9.7 pp from 88.0% to 78.3% in 2015.
Gross Margin dropped on 10.3 pp from 48.8% to 38.5% in 2015. SG&A as a % of Revenue surged on 16.8 pp from 8.9% to 25.7% in 2015.
Net Income marign jumped on 10.4 pp from -37.2% to -26.8% in 2015.
Capital expenditures (CAPEX) and working capital investments
China Ruifeng Renewable Energy Ltd's CAPEX/Revenue was 60.9% in 2015. The company showed fast CAPEX/Revenue growth of 55.4 pp from 5.5% in 2012 to 60.9% in 2015. Average CAPEX/Revenue for the last three years was 35.8%.Battling declining revenue the company invested a large share of EBITDA (77.7%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at low but positive ROIC (3.21%) and negative ROE (-19.63%). ROIC decreased on 4.0 pp from 7.2% to 3.2% in 2015. ROE surged on 19.2 pp from -38.9% to -19.6% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 7.3x and Debt / EBITDA is 7.9x. Net Debt / EBITDA jumped on 2.4x from 4.9x to 7.3x in 2015. Debt increased slightly on 0.71% in 2015 while cash dropped on 18.1% in 2015.
Appendix 1: Peers in Semiconductors
Below we provide China Ruifeng Renewable Energy Ltd benchmarking against other companies in Semiconductors 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 |
|---|
| Phoenitron Holdings Ltd ($8066) | | -7.2% | 4.0% | 243.8% | 405.3% |
| Jun Yang Solar Power Investments Ltd ($397) | | -81.0% | 256.8% | 1.1% | 168.9% |
| Honbridge Holdings Ltd ($8137) | | -76.4% | -97.5% | 608.9% | 57.0% |
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | | 15.5% | 16.0% | 3.3% | 23.2% |
| Shunfeng International Clean Energy Ltd ($1165) | | -46.3% | 44.4% | 275.6% | 22.4% |
| |
|---|
| Median (20 companies) | -7.8% | -11.2% | 3.0% | 11.7% | 0.5% |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | | -63.8% | 122.4% | -32.8% | -22.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jun Yang Solar Power Investments Ltd ($397) | -2.4% | 87.3% | 79.3% | 53.8% | 73.8% |
| Intel Corp ($4335) | 62.5% | 62.1% | 59.8% | 63.7% | 62.6% |
| PacMOS Technologies Holdings Ltd ($1010) | 68.1% | 68.8% | 65.7% | 65.7% | 57.5% |
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | 43.7% | 47.7% | 48.7% | 47.5% | 52.9% |
| Shenzhen Mingwah Aohan High Technology Corp Ltd ($8301) | 13.5% | 26.1% | 26.7% | 16.3% | 52.8% |
| |
|---|
| Median (20 companies) | 21.1% | 24.5% | 26.7% | 29.5% | 31.3% |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | 18.6% | 16.0% | 23.7% | 48.8% | 38.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Intel Corp ($4335) | 43.6% | 41.5% | 38.6% | 42.8% | 41.0% |
| Jun Yang Solar Power Investments Ltd ($397) | 3.9% | -218.5% | -16.7% | -9.9% | 35.0% |
| Semiconductor Manufacturing International Corp ($981) | 26.9% | 34.3% | 35.5% | 34.5% | 33.3% |
| Hua Hong Semiconductor Ltd ($1347) | 41.9% | 38.5% | 29.7% | 31.5% | 30.0% |
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | 22.4% | 26.5% | 23.9% | 25.4% | 26.8% |
| |
|---|
| Median (20 companies) | 10.9% | 7.6% | 6.1% | -0.9% | 9.1% |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | 13.4% | 9.1% | 37.2% | 88.0% | 78.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Heng Xin China Holdings Ltd ($8046) | 17.3% | 16.1% | 4.1% | 11.9% | 110.8% |
| Jun Yang Solar Power Investments Ltd ($397) | 390.5% | 671.1% | 25.9% | 78.9% | 104.2% |
| Semiconductor Manufacturing International Corp ($981) | 70.6% | 23.5% | 35.1% | 33.2% | 55.0% |
| Hua Hong Semiconductor Ltd ($1347) | 14.6% | 9.0% | 5.5% | 11.4% | 28.0% |
| China Jinhai International Group Ltd ($139) | 12.8% | | 1.2% | 0.1% | 18.4% |
| |
|---|
| Median (20 companies) | 10.6% | 4.4% | 4.1% | 5.7% | 5.2% |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | 2.1% | 5.5% | 35.9% | 10.6% | 60.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | 22.2% | 25.5% | 22.7% | 21.1% | 20.9% |
| Intel Corp ($4335) | 32.4% | 23.7% | 17.1% | 20.6% | 17.7% |
| Applied Materials Inc ($4336) | 25.6% | 4.0% | 4.6% | 15.9% | 15.2% |
| ASM Pacific Technology Ltd ($522) | 52.1% | 12.3% | 9.2% | 21.9% | 13.7% |
| Hua Hong Semiconductor Ltd ($1347) | | 5.3% | 4.8% | 7.8% | 6.7% |
| |
|---|
| Median (20 companies) | 1.7% | -2.2% | -0.4% | -0.5% | 0.8% |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | 9.8% | 0.7% | 4.4% | 7.2% | 3.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Solargiga Energy Holdings Ltd ($757) | 5.9x | | 13.8x | 4.4x | 9.0x |
| Shunfeng International Clean Energy Ltd ($1165) | 8.2x | | 25.8x | 3.4x | 5.7x |
| Semiconductor Manufacturing International Corp ($981) | 1.9x | 1.3x | 1.0x | 1.0x | 0.5x |
| Intel Corp ($4335) | 0.1x | 0.2x | 0.4x | 0.5x | 0.3x |
| ASM Pacific Technology Ltd ($522) | -0.4x | -0.5x | -0.8x | -0.1x | 0.2x |
| |
|---|
| Median (11 companies) | -0.2x | 0.1x | 0.3x | -0.1x | -0.1x |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | 4.0x | 16.4x | 6.9x | 4.9x | 7.3x |
