China E-Learning Group Ltd revenue decreased on 3.7% in 2015 and EBITDA Margin dropped on 35.5 pp from -22.0% to -57.5%
31/03/2016 • About China E-Learning Group Ltd (
$8055) • By InTwits
China E-Learning Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China E-Learning Group Ltd doesn't have a profitable business model yet: 2015 ROIC is -11.2%
- The company operates at negative EBITDA Margin: -57.5%
- China E-Learning Group Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 was 0.0%. On average EBITDA Margin was -24.5% for the sames years0
- China E-Learning Group Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.9%. At the same time it's in pair with industry average of 4.2%.
- CAPEX is quite volatile: 0.093 in 2015, 7.2 in 2014, 1.3 in 2013, 0.012 in 2012, 0.53 in 2011
- The company has unprofitable business model: ROIC is at -11.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China E-Learning Group Ltd ($8055) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 40.140 | 41.783 | 47.066 | 47.474 | 45.701 | -3.7% |
| Gross Profit | 24.078 | 28.589 | 21.968 | 19.794 | 17.613 | -11.0% |
| SG&A | 40.019 | 33.246 | | | | |
| EBITDA | -8.124 | 1.799 | -11.337 | -10.427 | -26.280 | 152.0% |
| Net Income | -39.007 | -30.397 | -96.449 | -56.872 | -41.875 | -26.4% |
Balance Sheet
|
|---|
| Cash | 19.459 | 22.309 | 15.101 | 187.412 | 64.061 | -65.8% |
| Short Term Debt | 66.817 | 94.590 | 88.435 | 9.382 | 0.000 | -100.0% |
| Long Term Debt | 26.105 | 68.024 | 91.569 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.534 | 0.012 | 1.287 | 7.240 | 0.093 | -98.7% |
Ratios
|
|---|
| Revenue growth | 4.1% | 4.1% | 12.6% | 0.9% | -3.7% | |
| EBITDA growth | 54.2% | -122.1% | -730.2% | -8.0% | 152.0% | |
| Gross Margin | 60.0% | 68.4% | 46.7% | 41.7% | 38.5% | -3.2% |
| EBITDA Margin | -20.2% | 4.3% | -24.1% | -22.0% | -57.5% | -35.5% |
| Net Income Margin | -97.2% | -72.7% | -204.9% | -119.8% | -91.6% | 28.2% |
| SG&A, % of revenue | 99.7% | 79.6% | | | | 0.0% |
| CAPEX, % of revenue | 1.3% | 0.0% | 2.7% | 15.3% | 0.2% | -15.0% |
| ROIC | -12.4% | -0.4% | -11.5% | -5.7% | -11.2% | -5.4% |
| ROE | | | | | -17.5% | -17.5% |
| Net Debt/EBITDA | | 78.0x | | | | 0.0x |
Revenue and profitability
The company's Revenue decreased on 3.7% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 28.4 pp from -16.7% to 11.7% in FY2015.
Gross Margin decreased on 3.2 pp from 41.7% to 38.5% in 2015.
Net Income marign jumped on 28.2 pp from -120% to -91.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
China E-Learning Group Ltd's CAPEX/Revenue was 0.20% in 2015. China E-Learning Group Ltd showed almost no change in CAPEX/Revenue from 2012 to 2015. It's average CAPEX/Revenue for the last three years was 6.1%.
Return on investment
The company operates at negative ROIC (-11.17%) and ROE (-17.53%). ROIC decreased on 5.4 pp from -5.7% to -11.2% in 2015.
Leverage (Debt)
The company paid down all the debt in 2015. Cash dropped on 65.8% in 2015.
Appendix 1: Peers in Internet
Below we provide China E-Learning Group Ltd benchmarking against other companies in Internet 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 |
|---|
| Asian Capital Resources Holdings Ltd ($8025) | | -5.6% | | | 1,114.6% |
| China Public Procurement Ltd ($1094) | | 5,077.0% | -67.5% | 1,258.9% | 105.7% |
| Ourgame International Holdings Ltd ($6899) | | 33.7% | 14.8% | 101.3% | 61.8% |
| Media Asia Group Holdings Ltd ($8075) | | 1,124.6% | 275.6% | 3.6% | 55.9% |
| Tai Shing International Holdings Ltd ($8103) | | 61.3% | -35.9% | -4.9% | 48.5% |
| |
|---|
| Median (20 companies) | 29.9% | 13.2% | 8.3% | 14.8% | 9.8% |
|---|
| China E-Learning Group Ltd ($8055) | | 4.1% | 12.6% | 0.9% | -3.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sino-I Technology Ltd ($250) | 74.2% | 75.3% | 82.7% | 78.8% | 82.8% |
| ABC Multiactive Ltd ($8131) | 73.0% | 86.7% | 83.5% | 86.2% | 82.1% |
| China Digital Culture Group Ltd ($8175) | 62.1% | 64.3% | 78.6% | 65.2% | 72.7% |
| Prosten Technology Holdings Ltd ($8026) | 76.3% | 52.4% | 47.8% | 50.8% | 67.1% |
| SUNeVision Holdings Ltd ($8008) | 51.4% | 53.5% | 60.5% | 64.7% | 65.6% |
| |
|---|
| Median (17 companies) | 65.2% | 65.0% | 68.4% | 61.8% | 59.5% |
|---|
| China E-Learning Group Ltd ($8055) | 60.0% | 68.4% | 46.7% | 41.7% | 38.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SUNeVision Holdings Ltd ($8008) | 61.1% | 64.2% | 71.6% | 71.6% | 72.4% |
| China Digital Culture Group Ltd ($8175) | -12.1% | -66.7% | 22.5% | 40.8% | 46.6% |
| Tencent Holdings Ltd ($700) | 48.2% | 38.4% | 34.7% | 42.5% | 43.5% |
| Tradelink Electronic Commerce Ltd ($536) | 42.1% | 38.6% | 33.8% | 33.1% | 31.1% |
| GET Holdings Ltd ($8380) | -182.0% | -237.7% | 56.8% | 66.4% | 28.5% |
| |
|---|
| Median (20 companies) | 13.8% | 7.1% | 22.5% | 15.6% | 11.1% |
|---|
| China E-Learning Group Ltd ($8055) | -20.2% | 4.3% | -24.1% | -22.0% | -57.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asian Capital Resources Holdings Ltd ($8025) | 0.0% | 0.0% | | 12.2% | 14.0% |
| SUNeVision Holdings Ltd ($8008) | 14.2% | 7.6% | 10.2% | 62.8% | 12.4% |
| Tencent Holdings Ltd ($700) | 14.2% | 9.0% | 8.1% | 5.5% | 8.2% |
| Ourgame International Holdings Ltd ($6899) | 4.5% | 1.8% | 3.1% | 1.7% | 6.4% |
| Sino-I Technology Ltd ($250) | 20.6% | 9.3% | 12.7% | 4.0% | 6.0% |
| |
|---|
| Median (20 companies) | 10.8% | 3.4% | 2.9% | 2.0% | 1.3% |
|---|
| China E-Learning Group Ltd ($8055) | 1.3% | 0.0% | 2.7% | 15.3% | 0.2% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tencent Holdings Ltd ($700) | 33.4% | 29.5% | 26.7% | 29.1% | 24.3% |
| Pacific Online Ltd ($543) | 41.7% | 37.9% | 36.4% | 28.6% | 21.6% |
| Tradelink Electronic Commerce Ltd ($536) | 19.5% | 22.4% | 18.2% | 17.4% | 16.7% |
| SUNeVision Holdings Ltd ($8008) | 9.9% | 10.8% | 13.3% | 14.4% | 15.3% |
| Ourgame International Holdings Ltd ($6899) | | 42.8% | 33.3% | 17.5% | 12.7% |
| |
|---|
| Median (21 companies) | -0.8% | -4.4% | 4.0% | 0.1% | 2.1% |
|---|
| China E-Learning Group Ltd ($8055) | -12.4% | -0.4% | -11.5% | -5.7% | -11.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tai Shing International Holdings Ltd ($8103) | | | | | 82.7x |
| Sino-I Technology Ltd ($250) | | | 9.4x | | 4.1x |
| GET Holdings Ltd ($8380) | | | -1.1x | -1.0x | 0.7x |
| Tencent Holdings Ltd ($700) | -0.1x | -0.2x | -0.2x | -0.2x | 0.5x |
| SUNeVision Holdings Ltd ($8008) | -2.7x | -2.2x | -2.0x | -1.5x | -1.2x |
| |
|---|
| Median (14 companies) | -1.7x | -1.6x | -1.1x | -1.5x | -1.9x |
|---|
