Zhongyu Gas Holdings Ltd reports 71.2% Net Income decline and 4.0% Revenue decline
31/03/2016 • About Zhongyu Gas Holdings Ltd (
$3633) • By InTwits
Zhongyu Gas Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Zhongyu Gas Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 15.4%. At the same time it's in pair with industry average of 13.8%.
- CAPEX is quite volatile: 750 in 2015, 644 in 2014, 557 in 2013, 227 in 2012, 165 in 2011
- The company has business model with low profitability: ROIC is at 8.2%
- It operates with high leverage: Net Debt/EBITDA is 4.8x while industry average is -0.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Zhongyu Gas Holdings Ltd ($3633) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,794 | 2,754 | 3,131 | 3,413 | 3,277 | -4.0% |
| Gross Profit | 429 | 649 | 746 | 850 | 785 | -7.7% |
| SG&A | | | 263 | 275 | 281 | 2.3% |
| EBITDA | 275 | 513 | 590 | 716 | 706 | -1.4% |
| Net Income | 86 | 226 | 262 | 324 | 93 | -71.2% |
Balance Sheet
|
|---|
| Cash | 351 | 349 | 430 | 828 | 984 | 18.8% |
| Short Term Debt | 435 | 661 | 528 | 424 | 1,206 | 184.2% |
| Long Term Debt | 454 | 525 | 1,281 | 3,029 | 3,186 | 5.2% |
Cash flow
|
|---|
| Capex | 165 | 227 | 557 | 644 | 750 | 16.4% |
Ratios
|
|---|
| Revenue growth | 53.4% | 53.5% | 13.7% | 9.0% | -4.0% | |
| EBITDA growth | 46.0% | 86.9% | 15.1% | 21.3% | -1.4% | |
| Gross Margin | 23.9% | 23.6% | 23.8% | 24.9% | 24.0% | -1.0% |
| EBITDA Margin | 15.3% | 18.6% | 18.9% | 21.0% | 21.5% | 0.6% |
| Net Income Margin | 4.8% | 8.2% | 8.4% | 9.5% | 2.9% | -6.7% |
| SG&A, % of revenue | | | 8.4% | 8.0% | 8.6% | 0.5% |
| CAPEX, % of revenue | 9.2% | 8.2% | 17.8% | 18.9% | 22.9% | 4.0% |
| ROIC | 10.6% | 17.4% | 15.0% | 12.3% | 8.2% | -4.2% |
| ROE | 9.3% | 18.2% | 17.0% | 17.6% | 4.7% | -12.9% |
| Net Debt/EBITDA | 2.0x | 1.6x | 2.3x | 3.7x | 4.8x | 1.2x |
Revenue and profitability
Zhongyu Gas Holdings Ltd's Revenue decreased on 4.0% in 2015. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.56 pp from 21.0% to 21.5% in 2015.
Gross Margin decreased slightly on 0.96 pp from 24.9% to 24.0% in 2015. SG&A as a % of Revenue increased slightly on 0.53 pp from 8.0% to 8.6% in 2015.
Net Income marign decreased on 6.7 pp from 9.5% to 2.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 22.9% in 2015. The company's CAPEX/Revenue surged on 14.6 pp from 8.2% in 2012 to 22.9% in 2015. It's average level of CAPEX/Revenue for the last three years was 19.8%.Zhongyu Gas Holdings Ltd has spent a lot to CAPEX (106% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at low ROIC (8.17%) and ROE (4.67%). ROIC decreased on 4.2 pp from 12.3% to 8.2% in 2015. ROE dropped on 12.9 pp from 17.6% to 4.7% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 4.8x and Debt / EBITDA is 6.2x. Net Debt / EBITDA surged on 1.2x from 3.7x to 4.8x in 2015. Debt jumped on 27.2% in 2015 while cash surged on 18.8% in 2015.
Appendix 1: Peers in Oil&Gas
Below you can find Zhongyu Gas Holdings Ltd benchmarking vs. other companies in Oil&Gas 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 |
|---|
| Enviro Energy International Holdings Ltd ($1102) | | -57.9% | 1,572.5% | -9.6% | 1,162.8% |
| Sino Oil And Gas Holdings Ltd ($702) | | -17.5% | -25.3% | -23.4% | 305.2% |
| China CBM Group Co Ltd ($8270) | | -27.6% | 1.8% | 60.9% | 9.3% |
| Yanchang Petroleum International Ltd ($346) | | 641.9% | 155.6% | 15.5% | 4.4% |
| South Sea Petroleum Holdings Ltd ($76) | | 21.5% | 231.0% | -77.6% | 0.8% |
| |
|---|
| Median (16 companies) | 30.1% | 10.3% | 3.7% | -3.9% | -15.7% |
|---|
| Zhongyu Gas Holdings Ltd ($3633) | | 53.5% | 13.7% | 9.0% | -4.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| United Energy Group Ltd ($467) | 15.4% | 39.4% | 48.0% | 53.8% | 51.5% |
| EPI Holdings Ltd ($689) | 0.3% | 58.0% | 50.7% | 54.6% | 41.2% |
| South Sea Petroleum Holdings Ltd ($76) | 48.2% | 27.3% | 25.3% | 38.5% | 22.2% |
| COSCO International Holdings Ltd ($517) | 8.4% | 6.9% | 7.5% | 10.6% | 11.5% |
| Sino Oil And Gas Holdings Ltd ($702) | 10.5% | 12.2% | -17.6% | -19.3% | 5.5% |
| |
|---|
| Median (9 companies) | 6.2% | 6.9% | 4.1% | 8.7% | 5.5% |
|---|
| Zhongyu Gas Holdings Ltd ($3633) | 23.9% | 23.6% | 23.8% | 24.9% | 24.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CNOOC Ltd ($883) | 50.3% | 48.5% | 47.2% | 50.7% | 53.0% |
| Kunlun Energy Co Ltd ($135) | 46.8% | 47.0% | 39.5% | 34.9% | 30.9% |
| PetroChina Co Ltd ($857) | 16.0% | 14.9% | 15.6% | 15.2% | 16.3% |
| China CBM Group Co Ltd ($8270) | 14.4% | 16.0% | -4.7% | 7.5% | 11.4% |
| China Petroleum & Chemical Corp ($386) | 6.9% | 6.2% | 6.3% | 5.9% | 8.6% |
| |
|---|
| Median (16 companies) | 4.0% | 3.7% | 1.4% | 5.9% | -6.7% |
|---|
| Zhongyu Gas Holdings Ltd ($3633) | 15.3% | 18.6% | 18.9% | 21.0% | 21.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| MIE Holdings Corp ($1555) | 43.9% | 52.2% | 43.3% | 44.1% | 62.4% |
| United Energy Group Ltd ($467) | 60.0% | 37.2% | 62.7% | 42.4% | 49.1% |
| CNOOC Ltd ($883) | 21.9% | 25.4% | 30.3% | 34.8% | 39.5% |
| Kunlun Energy Co Ltd ($135) | 52.1% | 46.7% | 35.5% | 19.9% | 14.2% |
| EPI Holdings Ltd ($689) | 33.6% | 30.6% | 30.9% | 4.1% | 12.8% |
| |
|---|
| Median (16 companies) | 27.7% | 15.0% | 6.7% | 4.5% | 6.8% |
|---|
| Zhongyu Gas Holdings Ltd ($3633) | 9.2% | 8.2% | 17.8% | 18.9% | 22.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Brightoil Petroleum Holdings Ltd ($933) | 18.2% | 4.2% | -4.4% | 6.5% | 13.8% |
| Kunlun Energy Co Ltd ($135) | 12.3% | 13.0% | 12.6% | 11.0% | 7.7% |
| China Petroleum & Chemical Corp ($386) | 14.2% | 11.9% | 10.6% | 7.5% | 5.5% |
| PetroChina Co Ltd ($857) | 13.4% | 11.2% | 10.9% | 9.3% | 4.2% |
| CNOOC Ltd ($883) | 32.4% | 25.7% | 18.1% | 15.8% | 3.2% |
| |
|---|
| Median (18 companies) | 3.6% | 3.8% | 1.6% | 1.5% | -1.7% |
|---|
| Zhongyu Gas Holdings Ltd ($3633) | 10.6% | 17.4% | 15.0% | 12.3% | 8.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Titan Petrochemicals Group Ltd ($1192) | | | | 95.2x | |
| Sino Oil And Gas Holdings Ltd ($702) | | | | 55.5x | |
| Shanghai Tonva Petrochemical Co Ltd ($1103) | 8.3x | 6.0x | 4.3x | 3.6x | |
| China CBM Group Co Ltd ($8270) | 1.3x | 3.2x | | 3.3x | 2.1x |
| Brightoil Petroleum Holdings Ltd ($933) | 2.7x | 8.9x | | 3.1x | 2.9x |
| |
|---|
| Median (12 companies) | 1.2x | 1.5x | 1.0x | 2.1x | 1.7x |
|---|
| Zhongyu Gas Holdings Ltd ($3633) | 2.0x | 1.6x | 2.3x | 3.7x | 4.8x |
