eForce Holdings Ltd reports 27.7 pp EBITDA Margin growth from -5.8% to 21.9% in 2015 while 2.9% Revenue decline
31/03/2016 • About eForce Holdings Ltd (
$943) • By InTwits
eForce Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 21.9% in 2015 vs. -5.8% in 2014 vs. -22.9% in 2011
- eForce Holdings Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 was 0.0%. On average EBITDA Margin was -6.1% for the sames years0
- eForce Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.2%. At the same time it's a lot of higher than industry average of 3.7%.
- CAPEX is quite volatile: 3.6 in 2015, 4.3 in 2014, 4.1 in 2013, 5.0 in 2012, 8.1 in 2011
- The company has potentially unprofitable business model: ROIC is at 7.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
eForce Holdings Ltd ($943) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 137.1 | 149.5 | 166.0 | 184.8 | 179.5 | -2.9% |
| Gross Profit | 19.2 | 31.7 | 40.3 | 47.3 | 51.1 | 8.1% |
| SG&A | | 67.3 | 70.5 | 67.1 | 75.1 | 12.1% |
| EBITDA | -31.4 | -25.3 | -21.6 | -10.7 | 39.3 | -467.2% |
| Net Income | -55.3 | -202.4 | -108.2 | -19.9 | -49.1 | 147.0% |
Balance Sheet
|
|---|
| Cash | 86.5 | 40.6 | 13.4 | 31.3 | 309.1 | 888.6% |
| Short Term Debt | 30.9 | 30.7 | 244.7 | 15.0 | 10.2 | -31.8% |
| Long Term Debt | 411.7 | 422.3 | 235.0 | 0.3 | 252.5 | 80,055.6% |
Cash flow
|
|---|
| Capex | 8.1 | 5.0 | 4.1 | 4.3 | 3.6 | -15.7% |
Ratios
|
|---|
| Revenue growth | -3.2% | 9.1% | 11.0% | 11.3% | -2.9% | |
| EBITDA growth | 52.3% | -19.6% | -14.4% | -50.4% | -467.2% | |
| Gross Margin | 14.0% | 21.2% | 24.3% | 25.6% | 28.5% | 2.9% |
| EBITDA Margin | -22.9% | -16.9% | -13.0% | -5.8% | 21.9% | 27.7% |
| Net Income Margin | -40.4% | -135.3% | -65.1% | -10.8% | -27.4% | -16.6% |
| SG&A, % of revenue | | 45.0% | 42.5% | 36.3% | 41.9% | 5.6% |
| CAPEX, % of revenue | 5.9% | 3.3% | 2.5% | 2.3% | 2.0% | -0.3% |
| ROIC | -10.1% | -6.4% | -7.0% | -5.1% | 7.0% | 12.1% |
| ROE | -38.7% | | | | -17.9% | -17.9% |
| Net Debt/EBITDA | | | | | -1.2x | -1.2x |
Revenue and profitability
The company's Revenue decreased on 2.9% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 27.7 pp from -5.8% to 21.9% in 2015.
Gross Margin increased on 2.9 pp from 25.6% to 28.5% in 2015. SG&A as a % of Revenue increased on 5.6 pp from 36.3% to 41.9% in 2015.
Net Income marign dropped on 16.6 pp from -10.8% to -27.4% in 2015.
Capital expenditures (CAPEX) and working capital investments
eForce Holdings Ltd's CAPEX/Revenue was 2.0% in 2015. EForce Holdings Ltd's CAPEX/Revenue decreased slightly on 1.3 pp from 3.3% in 2012 to 2.0% in 2015. It's average level of CAPEX/Revenue for the last three years was 2.3%.
Return on investment
The company operates at low but positive ROIC (7.00%) and negative ROE (-17.87%). ROIC jumped on 12.1 pp from -5.1% to 7.0% in 2015.
Leverage (Debt)
Debt level is -1.2x Net Debt / EBITDA and 6.7x Debt / EBITDA. Net Debt / EBITDA dropped1.2x from to -1.2x in 2015. Debt jumped on 1,620% in 2015 while cash surged on 889% in 2015.
Appendix 1: Peers in Household Products/Wares
Below we provide eForce Holdings Ltd benchmarking against other companies in Household Products/Wares 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 |
|---|
| Lisi Group Holdings Ltd ($526) | | 2.5% | -23.5% | 160.0% | 47.9% |
| Tempus Holdings Ltd ($6880) | | 17.3% | 5.5% | 31.1% | 14.7% |
| Lerado Group Holding Co Ltd ($1225) | | 4.1% | -91.1% | 4.8% | 14.3% |
| Goodbaby International Holdings Ltd ($1086) | | 15.5% | -8.0% | 46.0% | 13.7% |
| Samsonite International SA ($1910) | | 13.2% | 15.0% | 15.4% | 3.5% |
| |
|---|
| Median (9 companies) | | 11.5% | 3.6% | 10.0% | 3.5% |
|---|
| eForce Holdings Ltd ($943) | | 9.1% | 11.0% | 11.3% | -2.9% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Tempus Holdings Ltd ($6880) | 71.5% | 68.4% | 64.8% | 64.6% | 65.5% |
| Carpenter Tan Holdings Ltd ($837) | 68.4% | 66.9% | 67.0% | 65.8% | 64.5% |
| Biostime International Holdings Ltd ($1112) | 66.5% | 65.9% | 65.2% | 61.9% | 61.9% |
| Samsonite International SA ($1910) | 54.8% | 53.7% | 53.4% | 52.9% | 52.6% |
| Goodbaby International Holdings Ltd ($1086) | 17.1% | 19.1% | 22.9% | 25.0% | 29.5% |
| |
|---|
| Median (9 companies) | 22.4% | 24.5% | 22.9% | 25.0% | 29.5% |
|---|
| eForce Holdings Ltd ($943) | 14.0% | 21.2% | 24.3% | 25.6% | 28.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Carpenter Tan Holdings Ltd ($837) | 52.8% | 49.0% | 48.1% | 48.6% | 46.7% |
| Samsonite International SA ($1910) | 15.9% | 15.9% | 16.0% | 14.9% | 15.1% |
| Biostime International Holdings Ltd ($1112) | 30.0% | 30.4% | 27.6% | 24.3% | 14.8% |
| King's Flair International Holdings Ltd ($6822) | 7.0% | 8.3% | 7.9% | 9.7% | 14.6% |
| Lisi Group Holdings Ltd ($526) | 11.7% | 11.8% | -0.3% | 4.4% | 10.0% |
| |
|---|
| Median (9 companies) | 14.5% | 11.8% | 7.9% | 9.7% | 10.0% |
|---|
| eForce Holdings Ltd ($943) | -22.9% | -16.9% | -13.0% | -5.8% | 21.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lerado Group Holding Co Ltd ($1225) | 4.3% | 3.0% | 75.4% | 18.8% | 60.0% |
| Lisi Group Holdings Ltd ($526) | 7.9% | 7.1% | 11.3% | 6.1% | 13.1% |
| Samsonite International SA ($1910) | 2.4% | 2.1% | 2.8% | 3.0% | 2.8% |
| Goodbaby International Holdings Ltd ($1086) | 3.9% | 2.9% | 2.8% | 2.6% | 2.6% |
| Tempus Holdings Ltd ($6880) | 1.0% | 0.9% | 4.0% | 2.8% | 2.4% |
| |
|---|
| Median (9 companies) | 2.2% | 1.4% | 2.8% | 2.8% | 2.4% |
|---|
| eForce Holdings Ltd ($943) | 5.9% | 3.3% | 2.5% | 2.3% | 2.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| King's Flair International Holdings Ltd ($6822) | | 39.4% | 41.9% | 49.5% | 46.7% |
| Samsonite International SA ($1910) | 18.5% | 20.8% | 21.8% | 21.1% | 20.3% |
| Carpenter Tan Holdings Ltd ($837) | 35.2% | 30.3% | 24.6% | 20.7% | 17.6% |
| Biostime International Holdings Ltd ($1112) | 34.3% | 41.7% | 39.9% | 24.7% | 7.3% |
| Goodbaby International Holdings Ltd ($1086) | 7.3% | 10.7% | 8.8% | 3.9% | 6.1% |
| |
|---|
| Median (9 companies) | 18.7% | 18.2% | 8.8% | 3.9% | 6.1% |
|---|
| eForce Holdings Ltd ($943) | -10.1% | -6.4% | -7.0% | -5.1% | 7.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lisi Group Holdings Ltd ($526) | 2.9x | 3.4x | | 36.8x | 9.6x |
| Biostime International Holdings Ltd ($1112) | -2.3x | -0.4x | -0.0x | -0.0x | 8.8x |
| Goodbaby International Holdings Ltd ($1086) | -2.0x | -1.3x | -0.5x | 5.9x | 2.1x |
| Samsonite International SA ($1910) | -0.5x | -0.4x | -0.6x | -0.2x | -0.3x |
| Carpenter Tan Holdings Ltd ($837) | -1.9x | -2.5x | -2.1x | -0.9x | -1.5x |
| |
|---|
| Median (8 companies) | -0.8x | -0.8x | -0.9x | -0.5x | -0.9x |
|---|
| eForce Holdings Ltd ($943) | | | | | -1.2x |
