Sinofert Holdings Ltd Debt surged on 118% in 2015 while Revenue decreased on 7.7%
31/03/2016 • About Sinofert Holdings Ltd (
$297) • By InTwits
Sinofert Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sinofert Holdings Ltd is a company in decline: 2015 revenue growth was -7.7%, 5 years revenue CAGR was -2.3%
- EBITDA Margin is quite volatile: 2.6% in 2015, 1.7% in 2014, 0.3% in 2013, 3.4% in 2012, 3.2% in 2011
- Sinofert Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's a lot of higher than industry average of 3.1%.
- CAPEX is quite volatile: 404 in 2015, 826 in 2014, 463 in 2013, 386 in 2012, 320 in 2011
- The company has potentially unprofitable business model: ROIC is at 1.8%
- It operates with high leverage: Net Debt/EBITDA is 8.4x while industry average is 6.9x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sinofert Holdings Ltd ($297) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 36,685 | 41,190 | 34,722 | 28,311 | 26,121 | -7.7% |
| Gross Profit | 2,090 | 2,378 | 1,279 | 1,418 | 1,669 | 17.7% |
| SG&A | 1,261 | 1,434 | 1,488 | 1,441 | 1,378 | -4.3% |
| EBITDA | 1,181 | 1,401 | 110 | 479 | 668 | 39.3% |
| Net Income | 678 | 878 | -476 | 229 | 221 | -3.7% |
Balance Sheet
|
|---|
| Cash | 302 | 335 | 364 | 463 | 640 | 38.2% |
| Short Term Debt | 2,349 | 1,578 | 1,425 | 184 | 3,583 | 1,843.2% |
| Long Term Debt | 3,072 | 2,885 | 2,486 | 2,688 | 2,691 | 0.1% |
Cash flow
|
|---|
| Capex | 320 | 386 | 463 | 826 | 404 | -51.0% |
Ratios
|
|---|
| Revenue growth | 25.3% | 12.3% | -15.7% | -18.5% | -7.7% | |
| EBITDA growth | 68.3% | 18.6% | -92.2% | 337.8% | 39.3% | |
| Gross Margin | 5.7% | 5.8% | 3.7% | 5.0% | 6.4% | 1.4% |
| EBITDA Margin | 3.2% | 3.4% | 0.3% | 1.7% | 2.6% | 0.9% |
| Net Income Margin | 1.8% | 2.1% | -1.4% | 0.8% | 0.8% | 0.0% |
| SG&A, % of revenue | 3.4% | 3.5% | 4.3% | 5.1% | 5.3% | 0.2% |
| CAPEX, % of revenue | 0.9% | 0.9% | 1.3% | 2.9% | 1.5% | -1.4% |
| ROIC | 4.0% | 5.1% | -1.3% | 0.8% | 1.8% | 1.0% |
| ROE | 5.3% | 6.5% | -3.5% | 1.7% | 1.7% | -0.1% |
| Net Debt/EBITDA | 4.3x | 2.9x | 32.4x | 5.0x | 8.4x | 3.4x |
Revenue and profitability
The company's Revenue decreased on 7.7% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.86 pp from 1.7% to 2.6% in 2015.
Gross Margin increased slightly on 1.4 pp from 5.0% to 6.4% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign showed almost no change in 2015.
Capital expenditures (CAPEX) and working capital investments
Sinofert Holdings Ltd's CAPEX/Revenue was 1.5% in 2015. CAPEX/Revenue increased slightly on 0.61 pp from 0.94% in 2012 to 1.5% in 2015. It's average CAPEX/Revenue for the last three years was 1.9%.Battling declining revenue Sinofert Holdings Ltd invested a large share of EBITDA (60.5%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at low ROIC (1.76%) and ROE (1.68%). ROIC increased slightly on 0.98 pp from 0.78% to 1.8% in 2015. ROE showed almost no change in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 8.4x and Debt / EBITDA is 9.4x. Net Debt / EBITDA jumped on 3.4x from 5.0x to 8.4x in 2015. Debt jumped on 118% in 2015 while cash surged on 38.2% in 2015.
Appendix 1: Peers in Chemicals
Below we provide Sinofert Holdings Ltd benchmarking against other companies in Chemicals 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 |
|---|
| Bestway International Holdings Ltd ($718) | | -25.4% | -62.1% | 330.3% | 238.4% |
| China First Chemical Holdings Ltd ($2121) | | 6.2% | -6.8% | -18.0% | 72.5% |
| Strong Petrochemical Holdings Ltd ($852) | | 40.8% | 87.9% | -60.8% | 42.3% |
| Ko Yo Chemical Group Ltd ($827) | | -5.6% | -0.6% | 2.3% | 40.8% |
| China Sanjiang Fine Chemicals Co Ltd ($2198) | | 16.0% | 63.5% | -7.7% | 36.6% |
| |
|---|
| Median (30 companies) | 38.7% | 2.0% | 9.7% | 2.2% | -0.9% |
|---|
| Sinofert Holdings Ltd ($297) | | 12.3% | -15.7% | -18.5% | -7.7% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 74.3% | 70.5% | 69.1% | 70.8% | 69.9% |
| China Flavors & Fragrances Co Ltd ($3318) | 41.3% | 46.8% | 48.6% | 47.8% | 48.9% |
| Bestway International Holdings Ltd ($718) | 5.4% | 5.1% | 4.6% | 8.6% | 40.4% |
| Bracell Ltd ($1768) | 40.1% | 30.5% | 37.3% | 37.3% | 38.4% |
| Shaanxi Northwest New Technology Industry Co Ltd ($8258) | 22.1% | 28.7% | 30.9% | 30.0% | 37.9% |
| |
|---|
| Median (30 companies) | 20.3% | 20.8% | 18.7% | 18.4% | 20.5% |
|---|
| Sinofert Holdings Ltd ($297) | 5.7% | 5.8% | 3.7% | 5.0% | 6.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 66.4% | 63.8% | 59.1% | 60.0% | 58.3% |
| Bracell Ltd ($1768) | 30.1% | 22.3% | 30.8% | 38.2% | 35.9% |
| Yingde Gases Group Co Ltd ($2168) | 32.3% | 29.4% | 29.8% | 32.3% | 33.4% |
| Tiande Chemical Holdings Ltd ($609) | 21.7% | 25.5% | 27.3% | 25.1% | 27.8% |
| Century Sunshine Group Holdings Ltd ($509) | 15.5% | 24.2% | 28.1% | 27.6% | 26.1% |
| |
|---|
| Median (30 companies) | 15.4% | 14.5% | 13.6% | 12.5% | 13.4% |
|---|
| Sinofert Holdings Ltd ($297) | 3.2% | 3.4% | 0.3% | 1.7% | 2.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Landing International Development Ltd ($582) | 27.9% | 7.2% | 29.6% | 419.5% | 247.4% |
| China Zenith Chemical Group Ltd ($362) | 36.8% | 147.3% | 55.7% | 67.4% | 152.2% |
| Smartac Group China Holdings Ltd ($395) | 22.5% | 14.0% | 4.7% | 49.3% | 52.4% |
| China Flavors & Fragrances Co Ltd ($3318) | 16.4% | 15.8% | 20.1% | 42.4% | 35.8% |
| Ko Yo Chemical Group Ltd ($827) | 31.3% | 45.2% | 43.2% | 20.7% | 27.5% |
| |
|---|
| Median (30 companies) | 8.5% | 8.4% | 8.9% | 5.8% | 7.2% |
|---|
| Sinofert Holdings Ltd ($297) | 0.9% | 0.9% | 1.3% | 2.9% | 1.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Huabao International Holdings Ltd ($336) | 34.6% | 28.7% | 25.2% | 26.2% | 23.3% |
| Tiande Chemical Holdings Ltd ($609) | 24.4% | 26.2% | 29.4% | 20.7% | 20.6% |
| Sinopec Shanghai Petrochemical Co Ltd ($338) | 4.5% | -6.9% | 8.1% | -2.4% | 16.5% |
| Century Sunshine Group Holdings Ltd ($509) | 3.5% | 11.3% | 15.9% | 16.4% | 13.3% |
| Infinity Chemical Holdings Co Ltd ($640) | 9.2% | 11.1% | 10.2% | 8.8% | 12.7% |
| |
|---|
| Median (30 companies) | 8.2% | 7.3% | 8.3% | 5.9% | 5.9% |
|---|
| Sinofert Holdings Ltd ($297) | 4.0% | 5.1% | -1.3% | 0.8% | 1.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ko Yo Chemical Group Ltd ($827) | 7.4x | 8.8x | 22.0x | | 141.5x |
| China Sanjiang Fine Chemicals Co Ltd ($2198) | 2.4x | 2.2x | 4.6x | 18.1x | 13.5x |
| Ngai Hing Hong Co Ltd ($1047) | 4.8x | 11.7x | 5.3x | 5.4x | 5.3x |
| China XLX Fertiliser Ltd ($1866) | 2.4x | 2.6x | 5.1x | 5.8x | 5.1x |
| Strong Petrochemical Holdings Ltd ($852) | 1.2x | 7.2x | 4.0x | | 3.9x |
| |
|---|
| Median (26 companies) | 1.2x | 1.0x | 2.0x | 1.3x | 1.7x |
|---|
| Sinofert Holdings Ltd ($297) | 4.3x | 2.9x | 32.4x | 5.0x | 8.4x |
