China Fortune Holdings Ltd revenue surged on 174% in 2015 and EBITDA Margin surged on 24.5 pp from -44.7% to -20.1%
31/03/2016 • About China Fortune Holdings Ltd (
$110) • By InTwits
China Fortune Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Fortune Holdings Ltd doesn't have a profitable business model yet: 2015 ROIC is -8.8%
- The company operates at negative EBITDA Margin: -20.1%
- China Fortune Holdings 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 -2.6%0
- China Fortune Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.5%.
- The company has unprofitable business model: ROIC is at -8.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Fortune Holdings Ltd ($110) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,766 | 623 | 198 | 58 | 158 | 174.2% |
| Gross Profit | 61 | 14 | 16 | 9 | 5 | -37.0% |
| SG&A | | 38 | 37 | 40 | 25 | -38.6% |
| EBITDA | 23 | -22 | -17 | -26 | -32 | 23.6% |
| Net Income | 16 | -44 | -60 | -24 | -23 | -5.6% |
Balance Sheet
|
|---|
| Cash | 78 | 89 | 97 | 71 | 13 | -82.0% |
| Short Term Debt | 15 | 15 | 16 | 15 | 0 | -100.0% |
| Long Term Debt | 0 | 0 | 0 | 0 | 15 | |
Cash flow
|
|---|
| Capex | 4 | 7 | 0 | 1 | 0 | -97.6% |
Ratios
|
|---|
| Revenue growth | -30.6% | -64.7% | -68.2% | -71.0% | 174.2% | |
| EBITDA growth | 21.9% | -197.3% | -22.9% | 50.3% | 23.6% | |
| Gross Margin | 3.5% | 2.2% | 7.9% | 14.9% | 3.4% | -11.4% |
| EBITDA Margin | 1.3% | -3.6% | -8.6% | -44.7% | -20.1% | 24.5% |
| Net Income Margin | 0.9% | -7.0% | -30.2% | -42.5% | -14.6% | 27.9% |
| SG&A, % of revenue | | 6.1% | 18.4% | 70.2% | 15.7% | -54.5% |
| CAPEX, % of revenue | 0.2% | 1.1% | 0.1% | 1.1% | 0.0% | -1.1% |
| ROIC | 3.2% | -4.1% | -3.9% | -6.7% | -8.8% | -2.2% |
| ROE | 5.3% | -14.9% | -24.1% | -11.7% | -12.8% | -1.1% |
| Net Debt/EBITDA | -2.8x | | | | | 0.0x |
Revenue and profitability
China Fortune Holdings Ltd's Revenue jumped on 174% in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.77 pp from 12.9% to 13.7% in 2015.
Gross Margin dropped on 11.4 pp from 14.9% to 3.4% in 2015. SG&A as a % of Revenue dropped on 54.5 pp from 70.2% to 15.7% in 2015.
Net Income marign surged on 27.9 pp from -42.5% to -14.6% in 2015.
Capital expenditures (CAPEX) and working capital investments
China Fortune Holdings Ltd's CAPEX/Revenue was 0.0095% in 2015. China Fortune Holdings Ltd showed small CAPEX/Revenue decline of 1.1 pp from 1.1% in 2012 to 0.0095% in 2015. Average CAPEX/Revenue for the last three years was 0.40%.
Return on investment
The company operates at negative ROIC (-8.85%) and ROE (-12.80%). ROIC decreased on 2.2 pp from -6.7% to -8.8% in 2015. ROE decreased slightly on 1.1 pp from -11.7% to -12.8% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -3.3x and Debt / EBITDA is . Net Debt / EBITDA didn't change in 2015. Debt decreased on 4.8% in 2015 while cash dropped on 82.0% in 2015.
Appendix 1: Peers in Distribution/Wholesale
Below we provide China Fortune Holdings Ltd benchmarking against other companies in Distribution/Wholesale 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 |
|---|
| C Y Foundation Group Ltd ($1182) | | 8.3% | -65.6% | 5.9% | 214.6% |
| Hailiang International Holdings Ltd ($2336) | | 9.7% | -30.8% | -69.1% | 99.7% |
| Forefront Group Ltd ($885) | | | 504.6% | 3,871.0% | 72.0% |
| Yestar International Holdings Co Ltd ($2393) | | -2.2% | 22.8% | 30.5% | 60.3% |
| Goldin Financial Holdings Ltd ($530) | | -39.4% | 63.5% | 60.3% | 42.9% |
| |
|---|
| Median (35 companies) | 24.2% | 3.1% | 2.1% | 1.4% | -2.0% |
|---|
| China Fortune Holdings Ltd ($110) | | -64.7% | -68.2% | -71.0% | 174.2% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Yunnan Tin Minerals Group Co Ltd ($263) | 32.6% | 79.6% | 66.3% | | 98.7% |
| Goldin Financial Holdings Ltd ($530) | 67.0% | 75.3% | 71.7% | 74.8% | 73.8% |
| YGM Trading Ltd ($375) | 67.1% | 66.5% | 67.4% | 64.0% | 62.5% |
| Goldlion Holdings Ltd ($533) | 57.3% | 56.4% | 54.1% | 55.7% | 60.0% |
| E.Bon Holdings Ltd ($599) | 36.6% | 40.3% | 37.4% | 35.8% | 39.6% |
| |
|---|
| Median (33 companies) | 16.4% | 17.5% | 18.2% | 19.3% | 21.1% |
|---|
| China Fortune Holdings Ltd ($110) | 3.5% | 2.2% | 7.9% | 14.9% | 3.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China LNG Group Ltd ($931) | 195.2% | 95.1% | 76.4% | 97.9% | 1,277.8% |
| Goldin Financial Holdings Ltd ($530) | -134.6% | 163.7% | 613.4% | 285.7% | 364.1% |
| China Infrastructure Investment Ltd ($600) | -1,171.2% | -274.9% | 120.0% | 52.0% | 134.5% |
| China Yunnan Tin Minerals Group Co Ltd ($263) | -649.6% | -1,064.4% | -252.1% | | 62.8% |
| Goldlion Holdings Ltd ($533) | 27.8% | 25.8% | 23.4% | 22.5% | 22.8% |
| |
|---|
| Median (36 companies) | 2.9% | 2.6% | 2.5% | 4.6% | 4.9% |
|---|
| China Fortune Holdings Ltd ($110) | 1.3% | -3.6% | -8.6% | -44.7% | -20.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SIS International Holdings ($529) | 0.2% | 13.4% | 31.8% | 14.8% | 49.8% |
| Inspur International Ltd ($596) | 0.9% | 8.4% | 12.2% | 33.6% | 25.6% |
| China LNG Group Ltd ($931) | 2,875.2% | 11.1% | 0.3% | 0.6% | 15.6% |
| YGM Trading Ltd ($375) | 2.0% | 1.8% | 2.1% | 3.5% | 14.5% |
| Victory Group Ltd ($1139) | | 0.7% | 0.1% | 6.1% | 12.6% |
| |
|---|
| Median (35 companies) | 1.5% | 1.4% | 1.8% | 1.7% | 1.2% |
|---|
| China Fortune Holdings Ltd ($110) | 0.2% | 1.1% | 0.1% | 1.1% | 0.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China LNG Group Ltd ($931) | 2.2% | 8.4% | 7.4% | 87.0% | 56.2% |
| Powerwell Pacific Holdings Ltd ($8265) | 27.8% | 6.4% | 6.4% | 23.6% | 27.1% |
| Yestar International Holdings Co Ltd ($2393) | 29.4% | 28.8% | 24.1% | 26.2% | 25.4% |
| E.Bon Holdings Ltd ($599) | 4.4% | 7.0% | 7.2% | 3.3% | 16.9% |
| Goldin Financial Holdings Ltd ($530) | -10.1% | 5.9% | 20.6% | 10.4% | 16.0% |
| |
|---|
| Median (37 companies) | 2.2% | 2.7% | 1.7% | 3.2% | 2.8% |
|---|
| China Fortune Holdings Ltd ($110) | 3.2% | -4.1% | -3.9% | -6.7% | -8.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| SIS International Holdings ($529) | -62.1x | -1.8x | 7.0x | 7.2x | 16.8x |
| Leeport Holdings Ltd ($387) | 3.1x | | | | 16.1x |
| Takson Holdings Ltd ($918) | | | 11.5x | 11.7x | 15.7x |
| Sheng Yuan Holdings Ltd ($851) | | | | 19.3x | 15.4x |
| Forefront Group Ltd ($885) | | | | -0.0x | 15.3x |
| |
|---|
| Median (27 companies) | -0.2x | -0.2x | -0.6x | -0.0x | -0.2x |
|---|
