China Merchants Holdings International Co Ltd reports 46.4% CAPEX decline and almost no change in Revenue of 8,233
31/03/2016 • About China Merchants Holdings International Co Ltd (
$144) • By InTwits
China Merchants Holdings International Co Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Merchants Holdings International Co Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 32.0%. At the same time it's in pair with industry average of 38.8%.
- CAPEX is quite volatile: 1,696 in 2015, 3,165 in 2014, 3,485 in 2013, 3,911 in 2012, 1,962 in 2011
- The company has potentially unprofitable business model: ROIC is at 3.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Merchants Holdings International Co Ltd ($144) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 9,470 | 11,022 | 7,758 | 8,257 | 8,233 | -0.3% |
| Gross Profit | 4,052 | 4,335 | 3,236 | 3,520 | 3,631 | 3.2% |
| SG&A | 1,220 | 1,296 | 867 | 1,017 | 991 | -2.6% |
| EBITDA | 6,037 | 6,213 | 3,942 | 3,734 | 4,585 | 22.8% |
| Net Income | 5,589 | 3,818 | 4,213 | 4,526 | 4,808 | 6.2% |
Balance Sheet
|
|---|
| Cash | 6,520 | 2,806 | 3,205 | 9,501 | 10,293 | 8.3% |
| Short Term Debt | 7,482 | 7,021 | 2,417 | 6,675 | 1,800 | -73.0% |
| Long Term Debt | 17,216 | 11,801 | 24,541 | 13,296 | 17,345 | 30.5% |
Cash flow
|
|---|
| Capex | 1,962 | 3,911 | 3,485 | 3,165 | 1,696 | -46.4% |
Ratios
|
|---|
| Revenue growth | 63.0% | 16.4% | -29.6% | 6.4% | -0.3% | |
| EBITDA growth | 20.4% | 2.9% | -36.6% | -5.3% | 22.8% | |
| Gross Margin | 42.8% | 39.3% | 41.7% | 42.6% | 44.1% | 1.5% |
| EBITDA Margin | 63.7% | 56.4% | 50.8% | 45.2% | 55.7% | 10.5% |
| Net Income Margin | 59.0% | 34.6% | 54.3% | 54.8% | 58.4% | 3.6% |
| SG&A, % of revenue | 12.9% | 11.8% | 11.2% | 12.3% | 12.0% | -0.3% |
| CAPEX, % of revenue | 20.7% | 35.5% | 44.9% | 38.3% | 20.6% | -17.7% |
| ROIC | 5.9% | 6.3% | 3.4% | 2.7% | 3.3% | 0.6% |
| ROE | 13.6% | 8.6% | 9.0% | 7.8% | 7.1% | -0.7% |
| Net Debt/EBITDA | 3.0x | 2.6x | 6.0x | 2.8x | 1.9x | -0.9x |
Revenue and profitability
China Merchants Holdings International Co Ltd's Revenue showed almost no change in 2015. Despite revenue decline the EBITDA margin expanded. EBITDA Margin jumped on 10.5 pp from 45.2% to 55.7% in 2015.
Gross Margin increased slightly on 1.5 pp from 42.6% to 44.1% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign increased on 3.6 pp from 54.8% to 58.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 20.6%. CAPEX/Revenue dropped on 14.9 pp from 35.5% in 2012 to 20.6% in 2015. For the last three years the average CAPEX/Revenue was 34.6%.
Return on investment
The company operates at low ROIC (3.25%) and ROE (7.06%). ROIC increased slightly on 0.55 pp from 2.7% to 3.3% in 2015. ROE decreased slightly on 0.74 pp from 7.8% to 7.1% in 2015.
Leverage (Debt)
Debt level is 1.9x Net Debt / EBITDA and 4.2x Debt / EBITDA. Net Debt / EBITDA dropped on 0.9x from 2.8x to 1.9x in 2015. Debt decreased on 4.1% in 2015 while cash increased on 8.3% in 2015.
Appendix 1: Peers in Holding Companies-Divers
Below we provide China Merchants Holdings International Co Ltd benchmarking against other companies in Holding Companies-Divers 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 |
|---|
| Beijing Development HK Ltd ($154) | | 12.5% | | | 1,048.9% |
| CIAM Group Ltd ($378) | | -62.2% | 47.9% | -40.0% | 211.5% |
| Melco International Development Ltd ($200) | | 16.5% | 21.7% | 3.0% | 134.9% |
| New Century Group Hong Kong Ltd ($234) | | -68.9% | 326.7% | -70.3% | 118.2% |
| Greater China Holdings Ltd ($431) | | -35.8% | -72.1% | 67.3% | 110.3% |
| |
|---|
| Median (41 companies) | -3.5% | 11.4% | 4.9% | 15.7% | 7.2% |
|---|
| China Merchants Holdings International Co Ltd ($144) | | 16.4% | -29.6% | 6.4% | -0.3% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| New Century Group Hong Kong Ltd ($234) | 76.7% | 27.3% | 85.2% | 82.8% | 91.5% |
| Melco International Development Ltd ($200) | 72.0% | 63.1% | 52.9% | 54.5% | 79.4% |
| CIAM Group Ltd ($378) | | | | | 75.8% |
| Emperor International Holdings Ltd ($163) | 74.5% | 71.3% | 64.9% | 79.2% | 75.3% |
| Heng Fai Enterprises Ltd ($185) | 89.3% | 89.0% | 89.5% | 58.3% | 74.7% |
| |
|---|
| Median (37 companies) | 27.9% | 32.9% | 34.6% | 30.8% | 30.8% |
|---|
| China Merchants Holdings International Co Ltd ($144) | 42.8% | 39.3% | 41.7% | 42.6% | 44.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| New Century Group Hong Kong Ltd ($234) | 82.5% | -5.5% | 78.8% | 58.3% | 85.0% |
| Emperor International Holdings Ltd ($163) | 224.8% | 180.7% | 131.8% | 100.6% | 73.9% |
| Pioneer Global Group Ltd ($224) | 111.2% | -0.5% | -9.9% | -11.6% | 64.3% |
| C C Land Holdings Ltd ($1224) | 22.0% | 27.0% | 23.6% | 24.6% | 55.7% |
| Magnificent Estates ($201) | 42.1% | 45.5% | 47.8% | 53.0% | 40.6% |
| |
|---|
| Median (41 companies) | 5.2% | 1.7% | 1.9% | 5.6% | 4.8% |
|---|
| China Merchants Holdings International Co Ltd ($144) | 63.7% | 56.4% | 50.8% | 45.2% | 55.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Heng Fai Enterprises Ltd ($185) | 217.5% | 4.8% | 77.1% | 310.0% | 458.1% |
| Chinney Investments Ltd ($216) | 37.6% | 17.5% | 103.4% | 111.3% | 230.9% |
| China Investments Holdings Ltd ($132) | 20.7% | 4.8% | 81.9% | 382.2% | 222.5% |
| Goldin Properties Holdings Ltd ($283) | | 2,178.4% | 1,190.0% | 50.1% | 202.4% |
| Emperor International Holdings Ltd ($163) | 93.5% | 100.9% | 48.5% | 105.9% | 110.6% |
| |
|---|
| Median (41 companies) | 4.1% | 2.2% | 3.6% | 6.1% | 6.0% |
|---|
| China Merchants Holdings International Co Ltd ($144) | 20.7% | 35.5% | 44.9% | 38.3% | 20.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| C C Land Holdings Ltd ($1224) | 4.5% | 7.4% | 5.3% | 7.9% | 15.0% |
| Chinney Alliance Group Ltd ($385) | 3.4% | 6.4% | 8.1% | 13.6% | 15.0% |
| Top Spring International Holdings Ltd ($3688) | 27.9% | 15.6% | 6.9% | 7.3% | 8.0% |
| New Century Group Hong Kong Ltd ($234) | 8.6% | -1.7% | 11.7% | 1.7% | 7.3% |
| Chuang's China Investments Ltd ($298) | -0.9% | 22.9% | 1.5% | 2.2% | 6.1% |
| |
|---|
| Median (41 companies) | 0.3% | -0.2% | -0.2% | 0.5% | 0.2% |
|---|
| China Merchants Holdings International Co Ltd ($144) | 5.9% | 6.3% | 3.4% | 2.7% | 3.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Chinney Investments Ltd ($216) | 111.3x | 10.3x | 63.7x | 48.6x | 93.7x |
| Multifield International Holdings Ltd ($898) | 12.0x | 3.2x | 7.3x | 3.0x | 55.9x |
| CIAM Group Ltd ($378) | -48.0x | | | | 32.6x |
| Chuang's Consortium International Ltd ($367) | 2.2x | 0.7x | 5.0x | | 23.9x |
| Pioneer Global Group Ltd ($224) | 7.9x | | | | 10.9x |
| |
|---|
| Median (22 companies) | 2.8x | 2.4x | 2.9x | 3.2x | 2.9x |
|---|
| China Merchants Holdings International Co Ltd ($144) | 3.0x | 2.6x | 6.0x | 2.8x | 1.9x |
