China Public Procurement Ltd revenue growth decelerated to 106% in 2015 vs. 1,259% a year earliner
31/03/2016 • About China Public Procurement Ltd (
$1094) • By InTwits
China Public Procurement Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Public Procurement Ltd doesn't have a profitable business model yet: 2015 ROIC is -100.2%
- The company operates at negative EBITDA Margin: -42.7%
- China Public Procurement Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 was 0.0%. On average EBITDA Margin was -39.7% for the sames years0
- China Public Procurement Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 36.9%. At the same time it's a lot of higher than industry average of 4.2%.
- CAPEX is quite volatile: 0.50 in 2015, 1.3 in 2014, 16.1 in 2013, 151 in 2012, 6.0 in 2011
- The company has unprofitable business model: ROIC is at -100.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Public Procurement Ltd ($1094) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 5 | 277 | 90 | 1,223 | 2,516 | 105.7% |
| Gross Profit | 0 | -0 | 80 | 6 | 10 | 77.6% |
| SG&A | 45 | 119 | 165 | 162 | 116 | -28.7% |
| EBITDA | -17 | 17 | 88 | -648 | -1,074 | 65.8% |
| Net Income | -23 | -15 | 37 | -665 | -1,074 | 61.4% |
Balance Sheet
|
|---|
| Cash | 97 | 114 | 75 | 20 | 52 | 158.6% |
| Short Term Debt | 0 | 7 | 7 | 0 | 36 | |
| Long Term Debt | 0 | 57 | 57 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 6 | 151 | 16 | 1 | 0 | -61.5% |
Ratios
|
|---|
| Revenue growth | -78.5% | 5,077.0% | -67.5% | 1,258.9% | 105.7% | |
| EBITDA growth | -106.4% | -198.9% | 428.1% | -838.9% | 65.8% | |
| Gross Margin | 4.6% | -0.0% | 89.1% | 0.5% | 0.4% | -0.1% |
| EBITDA Margin | -313.6% | 6.0% | 97.4% | -53.0% | -42.7% | 10.3% |
| Net Income Margin | -437.8% | -5.3% | 41.6% | -54.4% | -42.7% | 11.7% |
| SG&A, % of revenue | 837.6% | 43.0% | 183.4% | 13.3% | 4.6% | -8.7% |
| CAPEX, % of revenue | 111.9% | 54.4% | 17.8% | 0.1% | 0.0% | -0.1% |
| ROIC | | | 4.0% | -37.4% | -100.2% | -62.8% |
| ROE | | | 2.2% | -40.6% | -109.8% | -69.2% |
| Net Debt/EBITDA | | -3.0x | -0.1x | | | 0.0x |
Revenue and profitability
The company's Revenue surged on 106% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 28.8 pp from 17.8% to -11.0% in 2015.
Gross Margin showed almost no change in 2015. SG&A as a % of Revenue decreased on 8.7 pp from 13.3% to 4.6% in 2015.
Net Income marign jumped on 11.7 pp from -54.4% to -42.7% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.020% in 2015. China Public Procurement Ltd's CAPEX/Revenue dropped on 54.4 pp from 54.4% in 2012 to 0.020% in 2015. Average CAPEX/Revenue for the last three years was 6.0%.
Return on investment
The company operates at negative ROIC (-100.20%) and ROE (-109.78%). ROIC dropped on 62.8 pp from -37.4% to -100% in 2015. ROE dropped on 69.2 pp from -40.6% to -110% in 2015.
Leverage (Debt)
Debt level is -2.5x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2015. Debt surged while cash jumped on 159% in 2015.
Appendix 1: Peers in Internet
Below you can find China Public Procurement Ltd benchmarking vs. other companies in Internet 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 |
|---|
| Asian Capital Resources Holdings Ltd ($8025) | | -5.6% | | | 1,114.6% |
| 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% |
| GET Holdings Ltd ($8380) | | 13.8% | 2,126.4% | 154.4% | 38.6% |
| |
|---|
| Median (20 companies) | 29.9% | 12.3% | 12.6% | 11.3% | 5.7% |
|---|
| China Public Procurement Ltd ($1094) | | 5,077.0% | -67.5% | 1,258.9% | 105.7% |
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% | 66.9% | 63.4% | 61.8% | 59.5% |
|---|
| China Public Procurement Ltd ($1094) | 4.6% | -0.0% | 89.1% | 0.5% | 0.4% |
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% | 6.2% | 18.6% | 15.6% | 11.1% |
|---|
| China Public Procurement Ltd ($1094) | -313.6% | 6.0% | 97.4% | -53.0% | -42.7% |
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) | 8.0% | 3.2% | 2.7% | 2.7% | 1.3% |
|---|
| China Public Procurement Ltd ($1094) | 111.9% | 54.4% | 17.8% | 0.1% | 0.0% |
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) | -2.3% | -2.5% | 4.0% | 0.1% | 2.1% |
|---|
| China Public Procurement Ltd ($1094) | | | 4.0% | -37.4% | -100.2% |
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 | -1.4x | -1.2x | -1.5x | -1.9x |
|---|
