China Shanshui Cement Group Ltd EBITDA dropped on 210% in 2015 and EBITDA Margin dropped on 50.7 pp from 20.0% to -30.6%
31/03/2016 • About China Shanshui Cement Group Ltd (
$691) • By InTwits
China Shanshui Cement Group Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Shanshui Cement Group Ltd doesn't have a profitable business model yet: 2015 ROIC is -20.5%
- EBITDA Margin is declining: -30.6% in 2015 vs. 20.0% in 2014 vs. 27.7% in 2011
- EBITDA Margin is quite volatile: -30.6% in 2015, 20.0% in 2014, 22.2% in 2013, 25.8% in 2012, 27.7% in 2011
- China Shanshui Cement Group Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 16.0%. At the same time it's a lot of higher than industry average of 7.2%.
- CAPEX is quite volatile: 913 in 2015, 2,522 in 2014, 1,367 in 2013, 1,816 in 2012, 2,231 in 2011
- The company has unprofitable business model: ROIC is at -20.5%
- It operates with high leverage: Net Debt/EBITDA is 5.1x while industry average is 2.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Shanshui Cement Group Ltd ($691) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 16,862 | 16,161 | 16,535 | 15,596 | 11,166 | -28.4% |
| Gross Profit | 5,079 | 4,111 | 3,829 | 3,347 | 1,228 | -63.3% |
| SG&A | 1,276 | 1,160 | 1,369 | 1,541 | 2,436 | 58.1% |
| EBITDA | 4,676 | 4,165 | 3,669 | 3,123 | -3,422 | -209.6% |
| Net Income | 2,225 | 1,519 | 1,017 | 348 | -6,387 | -1,937.3% |
Balance Sheet
|
|---|
| Cash | 3,008 | 1,083 | 1,277 | 1,151 | 223 | -80.6% |
| Short Term Debt | 3,245 | 2,950 | 6,839 | 4,177 | 15,552 | 272.3% |
| Long Term Debt | 8,202 | 10,508 | 9,633 | 11,915 | 212 | -98.2% |
Cash flow
|
|---|
| Capex | 2,275 | 3,052 | 3,496 | 1,882 | 1,595 | -15.2% |
Ratios
|
|---|
| Revenue growth | 42.2% | -4.2% | 2.3% | -5.7% | -28.4% | |
| EBITDA growth | 86.6% | -10.9% | -11.9% | -14.9% | -209.6% | |
| Gross Margin | 30.1% | 25.4% | 23.2% | 21.5% | 11.0% | -10.5% |
| EBITDA Margin | 27.7% | 25.8% | 22.2% | 20.0% | -30.6% | -50.7% |
| Net Income Margin | 13.2% | 9.4% | 6.1% | 2.2% | -57.2% | -59.4% |
| SG&A, % of revenue | 7.6% | 7.2% | 8.3% | 9.9% | 21.8% | 11.9% |
| CAPEX, % of revenue | 13.5% | 18.9% | 21.1% | 12.1% | 14.3% | 2.2% |
| ROIC | 22.4% | 14.2% | 9.9% | 6.6% | -20.5% | -27.1% |
| ROE | 33.2% | 18.6% | 11.4% | 3.5% | -87.3% | -90.8% |
| Net Debt/EBITDA | 1.8x | 3.0x | 4.1x | 4.8x | | -4.8x |
Revenue and profitability
The company's Revenue dropped on 28.4% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.0 pp from 24.7% to 26.7% in 2015.
Gross Margin dropped on 10.5 pp from 21.5% to 11.0% in 2015. SG&A as a % of Revenue jumped on 11.9 pp from 9.9% to 21.8% in 2015.
Net Income marign dropped on 59.4 pp from 2.2% to -57.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 14.3%. CAPEX/Revenue decreased on 4.6 pp from 18.9% in 2012 to 14.3% in 2015. It's average level of CAPEX/Revenue for the last three years was 15.8%.
Return on investment
The company operates at negative ROIC (-20.45%) and ROE (-87.33%). ROIC dropped on 27.1 pp from 6.6% to -20.5% in 2015. ROE dropped on 90.8 pp from 3.5% to -87.3% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 5.1x and Debt / EBITDA is . Net Debt / EBITDA dropped on 4.8x from 4.8x to in 2015. Debt decreased on 2.0% in 2015 while cash dropped on 80.6% in 2015.
Appendix 1: Peers in Building Materials
Below we provide China Shanshui Cement Group Ltd benchmarking against other companies in Building Materials 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 |
|---|
| Pacific Plywood Hldg Ltd ($767) | | -34.9% | -14.5% | 119.5% | 57.3% |
| Far East Global Group Ltd ($830) | | 52.9% | 9.5% | 18.6% | 30.5% |
| WLS Holdings Ltd/Hong Kong ($8021) | | 8.9% | 9.4% | -11.1% | 22.0% |
| China Wood Optimization Holding Ltd ($8099) | | 68.7% | 77.9% | 6.5% | 18.9% |
| Dongpeng Holdings Co Ltd ($3386) | | 26.2% | 34.8% | 15.6% | 5.6% |
| |
|---|
| Median (24 companies) | | -1.3% | 10.7% | 6.3% | -15.2% |
|---|
| China Shanshui Cement Group Ltd ($691) | | -4.2% | 2.3% | -5.7% | -28.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pacific Plywood Hldg Ltd ($767) | 95.0% | 91.4% | 82.0% | 97.2% | 98.6% |
| Sustainable Forest Holdings Ltd ($723) | 58.2% | -2.4% | 12.1% | 19.7% | 55.2% |
| Dongpeng Holdings Co Ltd ($3386) | 28.7% | 35.6% | 37.1% | 38.5% | 39.1% |
| Luks Group Vietnam Holdings Co Ltd ($366) | 37.6% | 37.2% | 36.9% | 37.0% | 36.4% |
| Anhui Conch Cement Co Ltd ($914) | 39.4% | 27.3% | 32.5% | 33.2% | 26.9% |
| |
|---|
| Median (24 companies) | 26.0% | 20.0% | 22.0% | 20.8% | 17.7% |
|---|
| China Shanshui Cement Group Ltd ($691) | 30.1% | 25.4% | 23.2% | 21.5% | 11.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pacific Plywood Hldg Ltd ($767) | 53.6% | 12.6% | -19.8% | 50.5% | 34.7% |
| China Tianrui Group Cement Co Ltd ($1252) | 32.4% | 28.5% | 23.7% | 26.7% | 32.8% |
| Anhui Conch Cement Co Ltd ($914) | 38.8% | 27.1% | 31.1% | 32.1% | 29.7% |
| Luks Group Vietnam Holdings Co Ltd ($366) | 30.8% | 30.4% | 29.9% | 23.8% | 26.2% |
| Dongpeng Holdings Co Ltd ($3386) | 14.1% | 14.3% | 21.5% | 22.6% | 24.4% |
| |
|---|
| Median (24 companies) | 18.3% | 15.1% | 16.9% | 17.4% | 15.1% |
|---|
| China Shanshui Cement Group Ltd ($691) | 27.7% | 25.8% | 22.2% | 20.0% | -30.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Wood Optimization Holding Ltd ($8099) | 59.7% | 10.9% | 9.6% | 1.8% | 19.3% |
| Luks Group Vietnam Holdings Co Ltd ($366) | 1.7% | 0.6% | 0.5% | 4.1% | 14.2% |
| China Glass Holdings Ltd ($3300) | 37.2% | 19.6% | 12.5% | 12.4% | 13.5% |
| WLS Holdings Ltd/Hong Kong ($8021) | 4.9% | 6.0% | 6.6% | 7.9% | 11.5% |
| China Resources Cement Holdings Ltd ($1313) | 32.7% | 14.5% | 11.4% | 10.8% | 11.1% |
| |
|---|
| Median (24 companies) | 6.3% | 9.7% | 8.3% | 5.4% | 7.2% |
|---|
| China Shanshui Cement Group Ltd ($691) | 13.5% | 18.9% | 21.1% | 12.1% | 14.3% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dongpeng Holdings Co Ltd ($3386) | 49.7% | 37.1% | 35.8% | 27.2% | 26.6% |
| China Wood Optimization Holding Ltd ($8099) | | 33.5% | 27.3% | 17.7% | 17.7% |
| China Lesso Group Holdings Ltd ($2128) | 26.8% | 20.5% | 19.4% | 18.2% | 17.2% |
| Anhui Conch Cement Co Ltd ($914) | 27.2% | 12.7% | 17.5% | 18.4% | 11.7% |
| China Singyes Solar Technologies Holdings Ltd ($750) | 21.1% | 18.6% | 19.9% | 16.0% | 8.1% |
| |
|---|
| Median (24 companies) | 12.1% | 5.0% | 6.9% | 4.8% | 1.3% |
|---|
| China Shanshui Cement Group Ltd ($691) | 22.4% | 14.2% | 9.9% | 6.6% | -20.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sustainable Forest Holdings Ltd ($723) | 0.9x | | | 9.6x | |
| China National Building Material Co Ltd ($3323) | 3.9x | 6.7x | 6.8x | 6.3x | 8.5x |
| BBMG Corp ($2009) | 4.4x | 4.6x | 5.0x | 6.1x | 6.6x |
| China Tianrui Group Cement Co Ltd ($1252) | 3.0x | 4.2x | 5.1x | 5.2x | 7.9x |
| China Glass Holdings Ltd ($3300) | 3.0x | 9.9x | 2.9x | 4.7x | |
| |
|---|
| Median (20 companies) | 0.9x | 2.4x | 1.1x | 1.9x | 3.9x |
|---|
| China Shanshui Cement Group Ltd ($691) | 1.8x | 3.0x | 4.1x | 4.8x | |
