Pan Asia Environmental Protection Group Ltd reports 199% Net Income growth while 3.3 pp EBITDA Margin decline from 15.7% to 12.4%
30/03/2016 • About Pan Asia Environmental Protection Group Ltd (
$556) • By InTwits
Pan Asia Environmental Protection Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 12.4% in 2015, 15.7% in 2014, 0.1% in 2013, -0.6% in 2012, 4.9% in 2011
- Pan Asia Environmental Protection Group Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 16.5%. At the same time it's in pair with industry average of 21.4%.
- CAPEX is quite volatile: 6.4 in 2015, 114 in 2014, 90.8 in 2013, 74.2 in 2012, 136 in 2011
- The company has business model with low profitability: ROIC is at 7.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Pan Asia Environmental Protection Group Ltd ($556) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 476 | 411 | 588 | 578 | 1,069 | 85.0% |
| Gross Profit | 60 | 45 | 65 | 156 | 245 | 56.9% |
| SG&A | 43 | 55 | 70 | 59 | 108 | 81.9% |
| EBITDA | 23 | -2 | 1 | 90 | 132 | 46.3% |
| Net Income | 10 | -30 | -21 | 23 | 70 | 198.5% |
Balance Sheet
|
|---|
| Cash | 607 | 564 | 571 | 379 | 276 | -27.2% |
| Short Term Debt | 0 | 14 | 14 | 14 | 0 | -100.0% |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 136 | 74 | 91 | 114 | 6 | -94.4% |
Ratios
|
|---|
| Revenue growth | -26.4% | -13.7% | 43.1% | -1.8% | 85.0% | |
| EBITDA growth | -79.6% | -110.4% | -134.0% | 10,802.8% | 46.3% | |
| Gross Margin | 12.6% | 10.9% | 11.0% | 27.1% | 22.9% | -4.1% |
| EBITDA Margin | 4.9% | -0.6% | 0.1% | 15.7% | 12.4% | -3.3% |
| Net Income Margin | 2.0% | -7.3% | -3.6% | 4.1% | 6.5% | 2.5% |
| SG&A, % of revenue | 8.9% | 13.4% | 11.9% | 10.2% | 10.1% | -0.2% |
| CAPEX, % of revenue | 28.6% | 18.1% | 15.4% | 19.8% | 0.6% | -19.2% |
| ROIC | 1.1% | -2.0% | -1.7% | 4.8% | 7.8% | 3.0% |
| ROE | 0.8% | -2.5% | -1.8% | 1.9% | 5.5% | 3.5% |
| Net Debt/EBITDA | -26.0x | | -672.3x | -4.0x | -2.1x | 2.0x |
Revenue and profitability
The company's Revenue jumped on 85.0% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 4.4 pp from -11.2% to -6.8% in FY2015.
Gross Margin decreased on 4.1 pp from 27.1% to 22.9% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign increased on 2.5 pp from 4.1% to 6.5% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Pan Asia Environmental Protection Group Ltd had CAPEX/Revenue of 0.59%. The company showed big decline in CAPEX/Revenue of 17.5 pp from 18.1% in 2012 to 0.59% in 2015. Average CAPEX/Revenue for the last three years was 11.9%.
Return on investment
The company operates at low ROIC (7.76%) and ROE (5.47%). ROIC increased on 3.0 pp from 4.8% to 7.8% in 2015. ROE increased on 3.5 pp from 1.9% to 5.5% in 2015.
Leverage (Debt)
The company paid down all the debt in 2015. Cash dropped on 27.2% in 2015.
Appendix 1: Peers in Environmental Control
Below you can find Pan Asia Environmental Protection Group Ltd benchmarking vs. other companies in Environmental Control 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 |
|---|
| Sky Forever Supply Chain Management Group Ltd ($8047) | | -73.4% | 446.4% | -62.3% | 12,494.5% |
| CT Environmental Group Ltd ($1363) | | -18.7% | 23.1% | 112.9% | 75.4% |
| ELL Environmental Holdings Ltd ($1395) | | 5.3% | 38.8% | 30.9% | 70.8% |
| Ozner Water International Holding Ltd ($2014) | | 183.9% | 38.5% | 27.2% | 45.7% |
| China Everbright International Ltd ($257) | | -2.2% | 56.0% | 19.5% | 34.3% |
| |
|---|
| Median (22 companies) | -14.6% | 2.3% | 18.1% | 23.6% | 3.1% |
|---|
| Pan Asia Environmental Protection Group Ltd ($556) | | -13.7% | 43.1% | -1.8% | 85.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| EverChina International Holdings Co Ltd ($202) | 40.2% | 51.8% | 53.4% | 95.3% | 95.4% |
| Ozner Water International Holding Ltd ($2014) | 56.7% | 64.5% | 67.8% | 65.4% | 58.9% |
| CT Environmental Group Ltd ($1363) | 57.7% | 65.8% | 63.1% | 56.4% | 49.9% |
| Kangda International Environmental Co Ltd ($6136) | 46.0% | 44.2% | 38.3% | 40.0% | 47.6% |
| China Water Affairs Group Ltd ($855) | 42.7% | 44.0% | 43.1% | 41.8% | 47.3% |
| |
|---|
| Median (21 companies) | 37.9% | 39.0% | 30.6% | 32.2% | 34.7% |
|---|
| Pan Asia Environmental Protection Group Ltd ($556) | 12.6% | 10.9% | 11.0% | 27.1% | 22.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CT Environmental Group Ltd ($1363) | 52.2% | 63.6% | 62.8% | 58.7% | 64.6% |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 55.9% | 57.5% | 56.6% | 57.8% | 57.9% |
| China Everbright International Ltd ($257) | 37.3% | 44.6% | 40.7% | 43.6% | 44.1% |
| China Water Affairs Group Ltd ($855) | 38.8% | 38.2% | 38.1% | 37.1% | 40.3% |
| Kangda International Environmental Co Ltd ($6136) | 37.9% | 37.1% | 33.6% | 32.4% | 36.6% |
| |
|---|
| Median (22 companies) | 21.7% | 17.9% | 11.7% | 3.1% | 16.2% |
|---|
| Pan Asia Environmental Protection Group Ltd ($556) | 4.9% | -0.6% | 0.1% | 15.7% | 12.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chaoyue Group Ltd ($147) | 3.8% | | 18.1% | 9.2% | 100.9% |
| Ozner Water International Holding Ltd ($2014) | 179.8% | 94.9% | 102.2% | 148.5% | 90.9% |
| Integrated Waste Solutions Group Holdings Ltd ($923) | 25.4% | 13.2% | 10.6% | 41.7% | 88.1% |
| Green Energy Group Ltd ($979) | 7.5% | 169.0% | 270.8% | 41.9% | 59.0% |
| CT Environmental Group Ltd ($1363) | 31.8% | 65.0% | 27.1% | 51.4% | 40.5% |
| |
|---|
| Median (22 companies) | 7.5% | 11.7% | 6.6% | 7.6% | 8.1% |
|---|
| Pan Asia Environmental Protection Group Ltd ($556) | 28.6% | 18.1% | 15.4% | 19.8% | 0.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CT Environmental Group Ltd ($1363) | 34.4% | 25.9% | 20.5% | 20.8% | 20.1% |
| China Everbright International Ltd ($257) | 11.1% | 10.4% | 11.2% | 10.5% | 10.8% |
| Baguio Green Group Ltd ($1397) | | 20.1% | 29.2% | 9.6% | 9.0% |
| Tianjin Capital Environmental Protection Group Co Ltd ($1065) | 7.4% | 7.1% | 6.8% | 7.8% | 8.8% |
| Kangda International Environmental Co Ltd ($6136) | | 12.5% | 11.8% | 10.7% | 8.8% |
| |
|---|
| Median (22 companies) | 5.3% | 3.9% | 6.8% | 2.6% | 3.2% |
|---|
| Pan Asia Environmental Protection Group Ltd ($556) | 1.1% | -2.0% | -1.7% | 4.8% | 7.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Kangda International Environmental Co Ltd ($6136) | 5.1x | 4.4x | 5.1x | 4.8x | 5.2x |
| China Water Affairs Group Ltd ($855) | 2.8x | 2.6x | 2.7x | 3.2x | 3.4x |
| Dynagreen Environmental Protection Group Co Ltd ($1330) | 0.4x | 3.2x | | | 3.2x |
| China Everbright International Ltd ($257) | 2.8x | 2.1x | 0.5x | 1.5x | 2.6x |
| Dongjiang Environmental Co Ltd ($895) | 1.0x | -1.7x | -1.5x | 0.9x | 2.5x |
| |
|---|
| Median (14 companies) | 1.2x | 2.3x | 0.4x | 1.5x | 1.5x |
|---|
| Pan Asia Environmental Protection Group Ltd ($556) | -26.0x | | -672.3x | -4.0x | -2.1x |
