Hoifu Energy Group Ltd reports 50.7% revenue decline in 2015 and 11.5 pp EBITDA Margin growth from -10.3% to 1.3%
30/03/2016 • About Hoifu Energy Group Ltd (
$7) • By InTwits
Hoifu Energy Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Hoifu Energy Group Ltd doesn't have a profitable business model yet: 2015 ROIC is -2.3%
- Hoifu Energy Group Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 is 0.0%. Average EBITDA Margin for the same period was -6.5%0
- Hoifu Energy Group Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.9%.
- The company has unprofitable business model: ROIC is at -2.3%
- It operates with high leverage: Net Debt/EBITDA is 62.5x while industry average is 2.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Hoifu Energy Group Ltd ($7) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 32.5 | 22.1 | 564.6 | 316.6 | 156.2 | -50.7% |
| EBITDA | -10.8 | -10.9 | -18.7 | -32.5 | 2.0 | -106.1% |
| Net Income | -270.3 | -21.3 | -21.5 | -37.8 | -36.5 | -3.4% |
Balance Sheet
|
|---|
| Cash | 16.5 | 215.9 | 177.8 | 78.0 | 50.4 | -35.4% |
| Short Term Debt | 34.4 | 51.2 | 65.9 | 87.0 | 174.9 | 101.1% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.5 | 0.1 | 1.4 | 1.1 | 2.6 | 128.1% |
Ratios
|
|---|
| Revenue growth | -28.0% | -32.1% | 2,458.7% | -43.9% | -50.7% | |
| EBITDA growth | 174.3% | 1.1% | 71.9% | 73.3% | -106.1% | |
| EBITDA Margin | -33.2% | -49.4% | -3.3% | -10.3% | 1.3% | 11.5% |
| Net Income Margin | -831.4% | -96.4% | -3.8% | -11.9% | -23.4% | -11.4% |
| CAPEX, % of revenue | 1.5% | 0.6% | 0.2% | 0.4% | 1.7% | 1.3% |
| ROIC | -3.7% | -5.7% | -7.3% | -10.0% | -2.3% | 7.7% |
| ROE | -86.9% | -9.6% | -7.8% | -12.4% | -10.4% | 1.9% |
| Net Debt/EBITDA | | | | | 62.5x | 62.5x |
Revenue and profitability
The company's Revenue dropped on 50.7% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 11.5 pp from -10.3% to 1.3% in 2015.
Net Income marign dropped on 11.4 pp from -11.9% to -23.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Hoifu Energy Group Ltd had CAPEX/Revenue of 1.7%. The company's CAPEX/Revenue increased slightly on 1.1 pp from 0.60% in 2012 to 1.7% in 2015. For the last three years the average CAPEX/Revenue was 0.75%.Battling declining revenue the company made large investments to CAPEX (130% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-2.31%) and ROE (-10.42%). ROIC increased on 7.7 pp from -10.0% to -2.3% in 2015. ROE increased slightly on 1.9 pp from -12.4% to -10.4% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 62.5x and Debt / EBITDA is 87.7x. Net Debt / EBITDA jumped62.5x from to 62.5x in 2015. Debt jumped on 101% in 2015 while cash dropped on 35.4% in 2015.
Appendix 1: Peers in Diversified Finan Serv
Below you can find Hoifu Energy Group Ltd benchmarking vs. other companies in Diversified Finan Serv 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 |
|---|
| China Smarter Energy Group Holdings Ltd ($1004) | | -4.0% | -23.1% | -87.3% | 1,860.5% |
| Crown International Corp Ltd ($727) | | 225.8% | -75.0% | 117.4% | 802.5% |
| Global Strategic Group Ltd ($8007) | | -3.9% | 2.1% | 806.3% | 681.2% |
| Upbest Group Ltd ($335) | | -38.5% | -61.8% | 24.1% | 208.1% |
| GF Securities Co Ltd ($1776) | | 16.3% | 31.8% | 75.0% | 163.9% |
| |
|---|
| Median (63 companies) | 3.8% | 4.5% | 14.9% | 27.6% | 24.9% |
|---|
| Hoifu Energy Group Ltd ($7) | | -32.1% | 2,458.7% | -43.9% | -50.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Roma Group Ltd ($8072) | | | | 99.4% | 98.7% |
| First China Financial Network Holdings Ltd ($8123) | 98.6% | 93.4% | | 94.5% | 97.4% |
| China Smarter Energy Group Holdings Ltd ($1004) | -3.3% | 6.2% | 4.0% | 46.9% | 96.9% |
| Chinese Strategic Holdings Ltd ($8089) | 97.9% | 99.1% | 97.9% | 97.0% | 96.6% |
| Allied Group Ltd ($373) | 94.5% | 95.1% | 94.4% | 93.6% | 92.2% |
| |
|---|
| Median (11 companies) | 80.8% | 64.2% | 75.1% | 88.2% | 91.7% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Smarter Energy Group Holdings Ltd ($1004) | -122.8% | -282.7% | -373.2% | -1,524.9% | 212.2% |
| China Aircraft Leasing Group Holdings Ltd ($1848) | 89.3% | 91.3% | 86.4% | 92.9% | 107.0% |
| Get Nice Holdings Ltd ($64) | 28.4% | 2.6% | 153.4% | 92.7% | 83.9% |
| Hong Kong Exchanges and Clearing Ltd ($388) | 83.5% | 81.6% | 73.4% | 75.7% | 82.1% |
| Hong Kong Finance Group Co Ltd ($1273) | 79.8% | 76.9% | 67.5% | 65.2% | 74.8% |
| |
|---|
| Median (64 companies) | 30.4% | 23.0% | 37.2% | 47.9% | 32.8% |
|---|
| Hoifu Energy Group Ltd ($7) | -33.2% | -49.4% | -3.3% | -10.3% | 1.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Aircraft Leasing Group Holdings Ltd ($1848) | 0.4% | 351.0% | 0.1% | 33.3% | 64.6% |
| Willie International Holdings Ltd ($273) | | | 0.3% | 0.8% | 58.0% |
| China Assurance Finance Group Ltd ($8090) | | 94.7% | 68.9% | 53.3% | 51.0% |
| AID Partners Capital Holdings Ltd ($8088) | 196.3% | 4.1% | 2.9% | 28.4% | 26.6% |
| Hongkong Chinese Ltd ($655) | | | | 0.1% | 25.6% |
| |
|---|
| Median (63 companies) | 2.3% | 2.1% | 1.9% | 1.1% | 1.5% |
|---|
| Hoifu Energy Group Ltd ($7) | 1.5% | 0.6% | 0.2% | 0.4% | 1.7% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hong Kong Exchanges and Clearing Ltd ($388) | 65.6% | 29.1% | 20.1% | 21.5% | 29.1% |
| China Smarter Energy Group Holdings Ltd ($1004) | -8.2% | -19.4% | -23.0% | -14.0% | 22.5% |
| Oi Wah Pawnshop Credit Holdings Ltd ($1319) | 30.4% | 32.7% | 20.7% | 14.0% | 15.3% |
| Emperor Capital Group Ltd ($717) | 5.1% | 5.1% | 12.8% | 13.1% | 14.6% |
| Roma Group Ltd ($8072) | | 19.6% | 43.7% | 107.8% | 13.3% |
| |
|---|
| Median (67 companies) | 4.9% | 4.4% | 4.2% | 4.9% | 3.7% |
|---|
| Hoifu Energy Group Ltd ($7) | -3.7% | -5.7% | -7.3% | -10.0% | -2.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| South China Financial Holdings Ltd ($619) | | | | | 56.9x |
| Bright Smart Securities & Commodities Group Ltd ($1428) | 7.3x | 2.1x | 10.3x | 9.3x | 39.3x |
| Far East Horizon Ltd ($3360) | 17.8x | 16.9x | 21.7x | 20.0x | 20.8x |
| Quam Ltd ($952) | 4.9x | 58.9x | 15.9x | 4.1x | 14.8x |
| China Aircraft Leasing Group Holdings Ltd ($1848) | 13.9x | 14.7x | 19.0x | 17.5x | 14.6x |
| |
|---|
| Median (49 companies) | -1.1x | -0.6x | 0.1x | -0.0x | -0.1x |
|---|
| Hoifu Energy Group Ltd ($7) | | | | | 62.5x |
