Ko Yo Chemical Group Ltd reports 86.9% CAPEX growth and 40.8% Revenue growth
30/03/2016 • About Ko Yo Chemical Group Ltd (
$827) • By InTwits
Ko Yo Chemical Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ko Yo Chemical Group Ltd doesn't have a profitable business model yet: 2015 ROIC is -1.5%
- EBITDA Margin is quite volatile: 0.9% in 2015, -13.8% in 2014, 12.7% in 2013, 21.3% in 2012, 16.0% in 2011
- Ko Yo Chemical Group Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 33.6%. At the same time it's a lot of higher than industry average of 21.3%.
- CAPEX is quite volatile: 50.9 in 2015, 81.0 in 2014, 47.7 in 2013, 57.5 in 2012, 212 in 2011
- The company has unprofitable business model: ROIC is at -1.5%
- It operates with high leverage: Net Debt/EBITDA is 141.5x while industry average is 6.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Ko Yo Chemical Group Ltd ($827) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,427 | 1,347 | 1,339 | 1,370 | 1,928 | 40.8% |
| Gross Profit | 282 | 327 | 137 | 12 | -27 | -331.7% |
| SG&A | | | 128 | 287 | 143 | -50.2% |
| EBITDA | 228 | 286 | 169 | -189 | 18 | -109.6% |
| Net Income | 100 | 102 | -57 | -490 | -106 | -78.4% |
Balance Sheet
|
|---|
| Cash | 132 | 351 | 117 | 498 | 60 | -88.0% |
| Short Term Debt | 1,542 | 2,063 | 2,802 | 2,006 | 1,870 | -6.8% |
| Long Term Debt | 285 | 808 | 1,040 | 796 | 760 | -4.6% |
Cash flow
|
|---|
| Capex | 447 | 609 | 578 | 284 | 530 | 86.9% |
Ratios
|
|---|
| Revenue growth | 63.5% | -5.6% | -0.6% | 2.3% | 40.8% | |
| EBITDA growth | 264.6% | 25.6% | -40.8% | -211.4% | -109.6% | |
| Gross Margin | 19.8% | 24.3% | 10.2% | 0.9% | -1.4% | -2.3% |
| EBITDA Margin | 16.0% | 21.3% | 12.7% | -13.8% | 0.9% | 14.7% |
| Net Income Margin | 7.0% | 7.5% | -4.3% | -35.8% | -5.5% | 30.3% |
| SG&A, % of revenue | | | 9.6% | 20.9% | 7.4% | -13.5% |
| CAPEX, % of revenue | 31.3% | 45.2% | 43.2% | 20.7% | 27.5% | 6.8% |
| ROIC | 5.7% | 6.0% | 2.0% | -5.6% | -1.5% | 4.1% |
| ROE | 10.5% | 9.5% | -5.2% | -34.7% | -6.1% | 28.7% |
| Net Debt/EBITDA | 7.4x | 8.8x | 22.0x | | 141.5x | 141.5x |
Revenue and profitability
The company's Revenue jumped on 40.8% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.3 pp from 3.4% to 4.7% in FY2015.
Gross Margin decreased on 2.3 pp from 0.86% to -1.4% in 2015. SG&A as a % of Revenue dropped on 13.5 pp from 20.9% to 7.4% in 2015.
Net Income marign surged on 30.3 pp from -35.8% to -5.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 27.5%. The company showed big decline in CAPEX/Revenue of 17.7 pp from 45.2% in 2012 to 27.5% in 2015. Average CAPEX/Revenue for the last three years was 30.5%.The company has spent a lot to CAPEX (2,918% of EBITDA) to fuel its growth.
Return on investment
The company operates at negative ROIC (-1.47%) and ROE (-6.05%). ROIC increased on 4.1 pp from -5.6% to -1.5% in 2015. ROE jumped on 28.7 pp from -34.7% to -6.1% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 141.5x and Debt / EBITDA is 144.8x. Net Debt / EBITDA jumped141.5x from to 141.5x in 2015. Debt decreased on 6.2% in 2015 while cash dropped on 88.0% in 2015.
Appendix 1: Peers in Chemicals
Below we provide Ko Yo Chemical Group Ltd benchmarking against other companies in Chemicals 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 |
|---|
| Bestway International Holdings Ltd ($718) | | -25.4% | -62.1% | 330.3% | 238.4% |
| China First Chemical Holdings Ltd ($2121) | | 6.2% | -6.8% | -18.0% | 72.5% |
| Strong Petrochemical Holdings Ltd ($852) | | 40.8% | 87.9% | -60.8% | 42.3% |
| China Sanjiang Fine Chemicals Co Ltd ($2198) | | 16.0% | 63.5% | -7.7% | 36.6% |
| Century Sunshine Group Holdings Ltd ($509) | | 68.7% | 32.0% | 26.4% | 21.4% |
| |
|---|
| Median (26 companies) | 32.5% | 2.4% | 9.7% | 1.8% | -0.6% |
|---|
| Ko Yo Chemical Group Ltd ($827) | | -5.6% | -0.6% | 2.3% | 40.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 74.3% | 70.5% | 69.1% | 70.8% | 69.9% |
| China Flavors & Fragrances Co Ltd ($3318) | 41.3% | 46.8% | 48.6% | 47.8% | 48.9% |
| Bestway International Holdings Ltd ($718) | 5.4% | 5.1% | 4.6% | 8.6% | 40.4% |
| Bracell Ltd ($1768) | 40.1% | 30.5% | 37.3% | 37.3% | 38.4% |
| Infinity Chemical Holdings Co Ltd ($640) | 22.0% | 25.4% | 28.0% | 29.8% | 33.2% |
| |
|---|
| Median (26 companies) | 20.3% | 18.9% | 18.7% | 18.4% | 20.5% |
|---|
| Ko Yo Chemical Group Ltd ($827) | 19.8% | 24.3% | 10.2% | 0.9% | -1.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 66.4% | 63.8% | 59.1% | 60.0% | 58.3% |
| Bracell Ltd ($1768) | 30.1% | 22.3% | 30.8% | 38.2% | 35.9% |
| Yingde Gases Group Co Ltd ($2168) | 32.3% | 29.4% | 29.8% | 32.3% | 33.4% |
| Tiande Chemical Holdings Ltd ($609) | 21.7% | 25.5% | 27.3% | 25.1% | 27.8% |
| Century Sunshine Group Holdings Ltd ($509) | 15.5% | 24.2% | 28.1% | 27.6% | 26.1% |
| |
|---|
| Median (26 companies) | 15.2% | 12.3% | 12.7% | 12.5% | 13.4% |
|---|
| Ko Yo Chemical Group Ltd ($827) | 16.0% | 21.3% | 12.7% | -13.8% | 0.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Landing International Development Ltd ($582) | 27.9% | 7.2% | 29.6% | 419.5% | 247.4% |
| China Zenith Chemical Group Ltd ($362) | 36.8% | 147.3% | 55.7% | 67.4% | 152.2% |
| China Flavors & Fragrances Co Ltd ($3318) | 16.4% | 15.8% | 20.1% | 42.4% | 35.8% |
| China XLX Fertiliser Ltd ($1866) | 13.0% | 30.1% | 41.1% | 32.1% | 22.0% |
| China Sanjiang Fine Chemicals Co Ltd ($2198) | 8.3% | 20.5% | 29.8% | 0.0% | 20.3% |
| |
|---|
| Median (26 companies) | 8.3% | 6.8% | 8.5% | 5.4% | 7.2% |
|---|
| Ko Yo Chemical Group Ltd ($827) | 31.3% | 45.2% | 43.2% | 20.7% | 27.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 34.6% | 28.7% | 25.2% | 26.2% | 23.3% |
| Tiande Chemical Holdings Ltd ($609) | 24.4% | 26.2% | 29.4% | 20.7% | 20.6% |
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 4.5% | -6.9% | 8.1% | -2.4% | 16.5% |
| Century Sunshine Group Holdings Ltd ($509) | 3.5% | 11.3% | 15.9% | 16.4% | 13.3% |
| Infinity Chemical Holdings Co Ltd ($640) | 9.2% | 11.1% | 10.2% | 8.8% | 12.7% |
| |
|---|
| Median (26 companies) | 8.2% | 7.3% | 8.3% | 5.9% | 6.5% |
|---|
| Ko Yo Chemical Group Ltd ($827) | 5.7% | 6.0% | 2.0% | -5.6% | -1.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Sanjiang Fine Chemicals Co Ltd ($2198) | 2.4x | 2.2x | 4.6x | 18.1x | 13.5x |
| Ngai Hing Hong Co Ltd ($1047) | 4.8x | 11.7x | 5.3x | 5.4x | 5.3x |
| China XLX Fertiliser Ltd ($1866) | 2.4x | 2.6x | 5.1x | 5.8x | 5.1x |
| Strong Petrochemical Holdings Ltd ($852) | 1.2x | 7.2x | 4.0x | | 3.9x |
| Yip's Chemical Holdings Ltd ($408) | 4.5x | 2.8x | 2.7x | 3.8x | 3.6x |
| |
|---|
| Median (23 companies) | 1.2x | 1.0x | 2.0x | 1.4x | 1.7x |
|---|
| Ko Yo Chemical Group Ltd ($827) | 7.4x | 8.8x | 22.0x | | 141.5x |
