Fosun International Ltd reports 56.8% CAPEX growth and 27.6% Revenue growth
30/03/2016 • About Fosun International Ltd (
$656) • By InTwits
Fosun International Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Fosun International Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.2%. At the same time it's in pair with industry average of 6.1%.
- CAPEX is quite volatile: 1,594 in 2015, 1,879 in 2014, 3,298 in 2013, 4,912 in 2012, 6,063 in 2011
- The company has potentially unprofitable business model: ROIC is at 6.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Fosun International Ltd ($656) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 56,816 | 51,765 | 51,017 | 61,738 | 78,797 | 27.6% |
| Gross Profit | 10,566 | 9,325 | 10,358 | 14,616 | 17,662 | 20.8% |
| SG&A | 4,994 | 5,778 | 6,608 | 11,349 | 16,447 | 44.9% |
| EBITDA | 8,954 | 8,655 | 11,752 | 12,900 | 17,529 | 35.9% |
| Net Income | 3,404 | 3,707 | 5,519 | 6,854 | 8,038 | 17.3% |
Balance Sheet
|
|---|
| Cash | 13,925 | 19,314 | 12,777 | 25,849 | 37,955 | 46.8% |
| Short Term Debt | 23,791 | 27,152 | 31,809 | 46,741 | 49,060 | 5.0% |
| Long Term Debt | 31,082 | 30,155 | 37,525 | 49,714 | 66,770 | 34.3% |
Cash flow
|
|---|
| Capex | 3,370 | 4,701 | 6,508 | 5,031 | 7,890 | 56.8% |
Ratios
|
|---|
| Revenue growth | 27.3% | -8.9% | -1.4% | 21.0% | 27.6% | |
| EBITDA growth | -16.4% | -3.3% | 35.8% | 9.8% | 35.9% | |
| Gross Margin | 18.6% | 18.0% | 20.3% | 23.7% | 22.4% | -1.3% |
| EBITDA Margin | 15.8% | 16.7% | 23.0% | 20.9% | 22.2% | 1.4% |
| Net Income Margin | 6.0% | 7.2% | 10.8% | 11.1% | 10.2% | -0.9% |
| SG&A, % of revenue | 8.8% | 11.2% | 13.0% | 18.4% | 20.9% | 2.5% |
| CAPEX, % of revenue | 5.9% | 9.1% | 12.8% | 8.1% | 10.0% | 1.9% |
| ROIC | 6.7% | 6.1% | 7.9% | 6.8% | 6.9% | 0.1% |
| ROE | 11.0% | 11.1% | 14.8% | 15.4% | 12.9% | -2.5% |
| Net Debt/EBITDA | 4.6x | 4.4x | 4.8x | 5.5x | 4.4x | -1.0x |
Revenue and profitability
Fosun International Ltd's Revenue jumped on 27.6% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin jumped on 12.1 pp from 23.6% to 35.7% in 2015.
Gross Margin decreased slightly on 1.3 pp from 23.7% to 22.4% in 2015. SG&A as a % of Revenue increased on 2.5 pp from 18.4% to 20.9% in 2015.
Net Income marign decreased slightly on 0.90 pp from 11.1% to 10.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Fosun International Ltd had CAPEX/Revenue of 10.0%. CAPEX/Revenue increased slightly on 0.93 pp from 9.1% in 2012 to 10.0% in 2015. Average CAPEX/Revenue for the last three years was 10.3%.
Return on investment
The company operates at good ROE (12.90%) while ROIC is low (6.90%). ROIC showed almost no change in 2015. ROE decreased on 2.5 pp from 15.4% to 12.9% in 2015.
Leverage (Debt)
Debt level is 4.4x Net Debt / EBITDA and 6.6x Debt / EBITDA. Net Debt / EBITDA dropped on 1.0x from 5.5x to 4.4x in 2015. Debt surged on 20.1% in 2015 while cash jumped on 46.8% in 2015.
Appendix 1: Peers in Iron/Steel
Below we provide Fosun International Ltd benchmarking against other companies in Iron/Steel 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 |
|---|
| CAA Resources Ltd ($2112) | | 99.6% | 103.2% | 38.0% | 261.2% |
| Newton Resources Ltd ($1231) | | | | -41.6% | 170.9% |
| Wanguo International Mining Group Ltd ($3939) | | -1.0% | -11.0% | -16.2% | 0.7% |
| Da Ming International Holdings Ltd ($1090) | | -2.1% | 29.3% | 29.8% | -8.1% |
| China Metal International Holdings Inc ($319) | | -2.5% | 7.3% | 8.0% | -10.8% |
| |
|---|
| Median (16 companies) | 41.1% | -8.4% | 0.6% | -6.0% | -17.9% |
|---|
| Fosun International Ltd ($656) | | -8.9% | -1.4% | 21.0% | 27.6% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Newton Resources Ltd ($1231) | 63.3% | | -223.7% | 15.7% | 37.5% |
| Wanguo International Mining Group Ltd ($3939) | 51.1% | 47.4% | 50.7% | 39.6% | 29.2% |
| China Metal International Holdings Inc ($319) | 21.0% | 20.9% | 24.3% | 24.8% | 25.5% |
| China Hanking Holdings Ltd ($3788) | 66.1% | 53.6% | 54.4% | 35.1% | 23.8% |
| Vale SA ($6210) | 58.4% | 45.4% | 48.3% | 33.1% | 19.6% |
| |
|---|
| Median (16 companies) | 21.0% | 14.8% | 12.7% | 11.3% | 13.7% |
|---|
| Fosun International Ltd ($656) | 18.6% | 18.0% | 20.3% | 23.7% | 22.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Wanguo International Mining Group Ltd ($3939) | 46.5% | 39.7% | 36.2% | 31.3% | 26.7% |
| China Metal International Holdings Inc ($319) | 17.8% | 19.7% | 21.3% | 21.0% | 22.0% |
| Xingda International Holdings Ltd ($1899) | 21.6% | 17.3% | 22.2% | 19.1% | 13.6% |
| Tiangong International Co Ltd ($826) | 22.5% | 25.1% | 25.8% | 19.3% | 11.6% |
| China Hanking Holdings Ltd ($3788) | 63.1% | 40.4% | 40.9% | 30.6% | 8.7% |
| |
|---|
| Median (16 companies) | 7.6% | 12.6% | 11.7% | 7.1% | 0.6% |
|---|
| Fosun International Ltd ($656) | 15.8% | 16.7% | 23.0% | 20.9% | 22.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Newton Resources Ltd ($1231) | 690.4% | | 926.9% | 1,395.7% | 197.0% |
| Vale SA ($6210) | 25.8% | 34.0% | 28.1% | 29.8% | 34.5% |
| China Hanking Holdings Ltd ($3788) | 24.5% | 38.0% | 35.7% | 20.2% | 30.5% |
| Pan Asia Mining Ltd ($8173) | 0.4% | 1.5% | 0.4% | 2.4% | 24.4% |
| China Vanadium Titano - Magnetite Mining Co Ltd ($893) | 14.2% | 8.9% | 10.5% | 20.4% | 24.1% |
| |
|---|
| Median (16 companies) | 10.8% | 8.3% | 10.5% | 6.4% | 8.0% |
|---|
| Fosun International Ltd ($656) | 5.9% | 9.1% | 12.8% | 8.1% | 10.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Metal International Holdings Inc ($319) | 11.5% | 11.0% | 12.0% | 12.7% | 11.4% |
| Wanguo International Mining Group Ltd ($3939) | 74.9% | 38.4% | 24.4% | 15.0% | 11.1% |
| Golik Holdings Ltd ($1118) | 9.0% | 7.0% | 7.4% | 10.0% | 10.8% |
| CAA Resources Ltd ($2112) | 33.0% | 69.2% | 33.5% | 2.2% | 6.9% |
| Tiangong International Co Ltd ($826) | 14.8% | 14.5% | 13.4% | 10.7% | 2.9% |
| |
|---|
| Median (16 companies) | 11.5% | 6.7% | 7.5% | 3.1% | -4.7% |
|---|
| Fosun International Ltd ($656) | 6.7% | 6.1% | 7.9% | 6.8% | 6.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Maanshan Iron & Steel Co Ltd ($323) | 5.0x | 55.2x | 7.3x | 5.3x | |
| China Hanking Holdings Ltd ($3788) | 0.3x | 0.4x | 2.5x | 4.7x | 27.3x |
| China Oriental Group Co Ltd ($581) | 2.4x | 4.6x | 5.3x | 4.5x | |
| Angang Steel Co Ltd ($347) | 6.6x | 21.4x | 4.0x | 4.3x | 29.1x |
| Da Ming International Holdings Ltd ($1090) | 8.0x | 8.4x | 8.5x | 4.0x | |
| |
|---|
| Median (13 companies) | 1.3x | 2.1x | 2.5x | 2.9x | 0.8x |
|---|
| Fosun International Ltd ($656) | 4.6x | 4.4x | 4.8x | 5.5x | 4.4x |
