First Pacific Co Ltd/Hong Kong reports 25.5% CAPEX decline and 5.9% Revenue decline
30/03/2016 • About First Pacific Co Ltd/Hong Kong (
$142) • By InTwits
First Pacific Co Ltd/Hong Kong reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- First Pacific Co Ltd/Hong Kong has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.1%. At the same time it's a lot of higher than industry average of 8.8%.
- CAPEX is quite volatile: 2,962 in 2015, 4,470 in 2014, 4,636 in 2013, 4,081 in 2012, 7,951 in 2011
- The company has potentially unprofitable business model: ROIC is at 4.7%
- It operates with high leverage: Net Debt/EBITDA is 5.6x while industry average is -1.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
First Pacific Co Ltd/Hong Kong ($142) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5,684 | 5,991 | 6,006 | 6,841 | 6,437 | -5.9% |
| Gross Profit | 1,774 | 1,862 | 1,760 | 1,917 | 1,822 | -5.0% |
| SG&A | 797 | 872 | 964 | 1,074 | 1,006 | -6.4% |
| EBITDA | 1,427 | 1,247 | 940 | 956 | 1,000 | 4.6% |
| Net Income | 574 | 353 | 235 | 81 | 85 | 5.1% |
Balance Sheet
|
|---|
| Cash | 1,875 | 2,175 | 2,015 | 1,500 | 753 | -49.8% |
| Short Term Debt | 1,119 | 927 | 1,067 | 912 | 999 | 9.5% |
| Long Term Debt | 2,576 | 3,439 | 4,551 | 4,894 | 5,363 | 9.6% |
Cash flow
|
|---|
| Capex | 357 | 541 | 768 | 483 | 360 | -25.5% |
Ratios
|
|---|
| Revenue growth | 22.5% | 5.4% | 0.3% | 13.9% | -5.9% | |
| EBITDA growth | 27.4% | -12.6% | -24.6% | 1.7% | 4.6% | |
| Gross Margin | 31.2% | 31.1% | 29.3% | 28.0% | 28.3% | 0.3% |
| EBITDA Margin | 25.1% | 20.8% | 15.6% | 14.0% | 15.5% | 1.6% |
| Net Income Margin | 10.1% | 5.9% | 3.9% | 1.2% | 1.3% | 0.1% |
| SG&A, % of revenue | 14.0% | 14.6% | 16.0% | 15.7% | 15.6% | -0.1% |
| CAPEX, % of revenue | 6.3% | 9.0% | 12.8% | 7.1% | 5.6% | -1.5% |
| ROIC | 11.9% | 8.8% | 5.4% | 4.7% | 4.7% | 0.0% |
| ROE | 20.5% | 11.3% | 7.0% | 2.3% | 2.6% | 0.3% |
| Net Debt/EBITDA | 1.3x | 1.8x | 3.8x | 4.5x | 5.6x | 1.1x |
Revenue and profitability
First Pacific Co Ltd/Hong Kong's Revenue decreased on 5.9% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.6 pp from 14.0% to 15.5% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 5.6% in 2015. First Pacific Co Ltd/Hong Kong's CAPEX/Revenue decreased on 3.4 pp from 9.0% in 2012 to 5.6% in 2015. Average CAPEX/Revenue for the last three years was 8.5%.
Return on investment
The company operates at low ROIC (4.75%) and ROE (2.59%). ROIC showed almost no change in 2015. ROE showed almost no change in 2015.
Leverage (Debt)
Debt level is 5.6x Net Debt / EBITDA and 6.4x Debt / EBITDA. Net Debt / EBITDA jumped on 1.1x from 4.5x to 5.6x in 2015. Debt increased on 9.6% in 2015 while cash dropped on 49.8% in 2015.
Management team
First Pacific Co Ltd/Hong Kong's CEO Manuel V Pangilinan has spent 15 years at the company. Christopher H Young is a First Pacific Co Ltd/Hong Kong's CFO. Christopher H Young has spent 3 years at the company.
Appendix 1: Peers in Food
Below you can find First Pacific Co Ltd/Hong Kong benchmarking vs. other companies in Food industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Imperial Pacific International Holdings Ltd ($1076) | | -27.6% | -18.5% | 2.7% | 70.3% |
| China Shengmu Organic Milk Ltd ($1432) | | 80.0% | 63.2% | 86.4% | 45.4% |
| Chinese Food and Beverage Group ($8272) | | 207.7% | 149.2% | 26.8% | 31.6% |
| Huisheng International Holdings Ltd ($1340) | | -2.4% | 5.6% | 8.7% | 25.9% |
| Honworld Group Ltd ($2226) | | 207.9% | 57.3% | 26.0% | 19.5% |
| |
|---|
| Median (37 companies) | 15.8% | 10.2% | 8.7% | 3.7% | -2.0% |
|---|
| First Pacific Co Ltd/Hong Kong ($142) | | 5.4% | 0.3% | 13.9% | -5.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hung Fook Tong Group Holdings Ltd ($1446) | 57.0% | 60.7% | 60.0% | 58.7% | 60.7% |
| Honworld Group Ltd ($2226) | 42.2% | 57.2% | 59.0% | 57.8% | 56.4% |
| Yashili International Holdings Ltd ($1230) | 52.0% | 53.7% | 53.5% | 51.2% | 50.8% |
| Natural Dairy NZ Holdings Ltd ($462) | 16.3% | -13.7% | 27.5% | 48.8% | 49.6% |
| China Shengmu Organic Milk Ltd ($1432) | 29.4% | 33.4% | 42.9% | 50.2% | 47.7% |
| |
|---|
| Median (36 companies) | 17.7% | 16.5% | 19.6% | 19.9% | 23.8% |
|---|
| First Pacific Co Ltd/Hong Kong ($142) | 31.2% | 31.1% | 29.3% | 28.0% | 28.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shenguan Holdings Group Ltd ($829) | 57.2% | 58.7% | 59.2% | 54.5% | 43.6% |
| Honworld Group Ltd ($2226) | 28.4% | 44.4% | 42.1% | 42.0% | 42.9% |
| China Shengmu Organic Milk Ltd ($1432) | 58.7% | 31.5% | 38.3% | 47.1% | 41.9% |
| China Huishan Dairy Holdings Co Ltd ($6863) | 109.2% | 45.1% | 47.9% | 47.1% | 37.2% |
| YuanShengTai Dairy Farm Ltd ($1431) | 147.8% | 40.3% | 48.4% | 47.1% | 35.4% |
| |
|---|
| Median (36 companies) | 8.2% | 8.0% | 6.6% | 7.5% | 8.2% |
|---|
| First Pacific Co Ltd/Hong Kong ($142) | 25.1% | 20.8% | 15.6% | 14.0% | 15.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Huishan Dairy Holdings Co Ltd ($6863) | 453.6% | 98.2% | 29.8% | 132.0% | 109.8% |
| Imperial Pacific International Holdings Ltd ($1076) | 0.0% | 0.0% | 0.0% | 15.6% | 88.5% |
| China Modern Dairy Holdings Ltd ($1117) | 58.9% | 50.6% | | 18.7% | 42.4% |
| Labixiaoxin Snacks Group Ltd ($1262) | 23.0% | 13.3% | 10.3% | 14.6% | 32.0% |
| YuanShengTai Dairy Farm Ltd ($1431) | 182.5% | 26.1% | 18.3% | 43.4% | 30.1% |
| |
|---|
| Median (35 companies) | 4.4% | 5.5% | 5.4% | 5.1% | 5.3% |
|---|
| First Pacific Co Ltd/Hong Kong ($142) | 6.3% | 9.0% | 12.8% | 7.1% | 5.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Want Want China Holdings Ltd ($151) | 24.9% | 27.9% | 29.4% | 22.8% | 21.8% |
| China Shengmu Organic Milk Ltd ($1432) | | 16.4% | 19.6% | 22.5% | 17.3% |
| Honworld Group Ltd ($2226) | 22.1% | 50.4% | 44.5% | 23.6% | 16.5% |
| WH Group Ltd ($288) | | 20.3% | 3.6% | 15.0% | 13.3% |
| Tenwow International Holdings Ltd ($1219) | 20.3% | 19.7% | 15.7% | 12.8% | 11.9% |
| |
|---|
| Median (37 companies) | 10.4% | 7.8% | 6.9% | 6.4% | 5.7% |
|---|
| First Pacific Co Ltd/Hong Kong ($142) | 11.9% | 8.8% | 5.4% | 4.7% | 4.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ausnutria Dairy Corp Ltd ($1717) | -3.5x | -1.4x | 0.8x | 1.7x | 27.9x |
| Beijing Jingkelong Co Ltd ($814) | 3.4x | 5.0x | 4.8x | 5.3x | 9.3x |
| China Kangda Food Co Ltd ($834) | 2.1x | 2.8x | 2.5x | 2.3x | 5.4x |
| China Modern Dairy Holdings Ltd ($1117) | 1.3x | 3.7x | 5.2x | 4.1x | 5.3x |
| Asia Cassava Resources Holdings Ltd ($841) | 0.6x | 4.0x | 5.6x | -0.6x | 4.7x |
| |
|---|
| Median (30 companies) | 0.2x | -0.4x | 0.8x | 0.7x | 1.2x |
|---|
| First Pacific Co Ltd/Hong Kong ($142) | 1.3x | 1.8x | 3.8x | 4.5x | 5.6x |
