China U-Ton Holdings Ltd Debt surged on 147% in 2015 while Revenue decreased on 7.0%
01/04/2016 • About China U-Ton Holdings Ltd (
$6168) • By InTwits
China U-Ton Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 16.2% in 2015 vs. 20.2% in 2014 vs. 40.6% in 2011
- EBITDA Margin is quite volatile: 16.2% in 2015, 20.2% in 2014, 28.4% in 2013, 35.6% in 2012, 40.6% in 2011
- China U-Ton Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.2%. At the same time it's in pair with industry average of 57.1%.
- CAPEX is quite volatile: 7.4 in 2015, 10.3 in 2014, 11.3 in 2013, 7.8 in 2012, 1.9 in 2011
- The company has business model with low profitability: ROIC is at 8.2%
- It operates with high leverage: Net Debt/EBITDA is 3.5x while industry average is 2.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China U-Ton Holdings Ltd ($6168) key annual financial indicators
| mln. CNY | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 161.7 | 246.4 | 377.6 | 511.5 | 475.5 | -7.0% |
| Gross Profit | 75.0 | 109.3 | 147.6 | 162.1 | 145.7 | -10.1% |
| SG&A | | 23.0 | 39.9 | 59.0 | 73.7 | 24.8% |
| EBITDA | 65.6 | 87.8 | 107.4 | 103.5 | 77.2 | -25.4% |
| Net Income | 55.4 | 65.7 | 85.2 | 74.7 | 48.7 | -34.8% |
Balance Sheet
|
|---|
| Cash | 43.8 | 130.3 | 161.7 | 167.6 | 63.6 | -62.1% |
| Short Term Debt | 10.9 | 41.2 | 43.9 | 99.9 | 192.5 | 92.6% |
| Long Term Debt | 0.0 | 0.0 | 7.2 | 35.3 | 140.9 | 299.4% |
Cash flow
|
|---|
| Capex | 1.9 | 7.8 | 11.3 | 10.3 | 7.4 | -28.0% |
Ratios
|
|---|
| Revenue growth | 213.8% | 52.3% | 53.3% | 35.4% | -7.0% | |
| EBITDA growth | 272.0% | 33.7% | 22.3% | -3.6% | -25.4% | |
| Gross Margin | 46.4% | 44.4% | 39.1% | 31.7% | 30.6% | -1.1% |
| EBITDA Margin | 40.6% | 35.6% | 28.4% | 20.2% | 16.2% | -4.0% |
| Net Income Margin | 34.2% | 26.7% | 22.6% | 14.6% | 10.2% | -4.4% |
| SG&A, % of revenue | | 9.4% | 10.6% | 11.5% | 15.5% | 4.0% |
| CAPEX, % of revenue | 1.2% | 3.2% | 3.0% | 2.0% | 1.6% | -0.5% |
| ROIC | 69.5% | 35.7% | 25.0% | 16.2% | 8.2% | -8.0% |
| ROE | 75.8% | 31.7% | 24.7% | 15.9% | 8.6% | -7.3% |
| Net Debt/EBITDA | -0.5x | -1.0x | -1.0x | -0.3x | 3.5x | 3.8x |
Revenue and profitability
The company's Revenue decreased on 7.0% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 14.4 pp from 10.1% to 24.5% in 2015.
Gross Margin decreased slightly on 1.1 pp from 31.7% to 30.6% in 2015. SG&A as a % of Revenue increased on 4.0 pp from 11.5% to 15.5% in 2015.
Net Income marign decreased on 4.4 pp from 14.6% to 10.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
China U-Ton Holdings Ltd's CAPEX/Revenue was 1.6% in 2015. CAPEX/Revenue decreased slightly on 1.6 pp from 3.2% in 2012 to 1.6% in 2015. It's average CAPEX/Revenue for the last three years was 2.2%.
Return on investment
The company operates at low ROIC (8.23%) and ROE (8.62%). ROIC decreased on 8.0 pp from 16.2% to 8.2% in 2015. ROE decreased on 7.3 pp from 15.9% to 8.6% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 3.5x and Debt / EBITDA is 4.3x. Net Debt / EBITDA surged on 3.8x from -0.3x to 3.5x in 2015. Debt surged on 147% in 2015 while cash dropped on 62.1% in 2015.
Appendix 1: Peers in Telecommunications
Below you can find China U-Ton Holdings Ltd benchmarking vs. other companies in Telecommunications 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 |
|---|
| Hong Kong Television Network Ltd ($1137) | | | 107.4% | -82.2% | 8,010.0% |
| Hanny Holdings Ltd ($275) | | 236.4% | 131.2% | -85.2% | 349.3% |
| CCT Fortis Holdings Ltd ($138) | | -24.1% | -55.3% | -71.3% | 207.1% |
| Xi'an Haitian Antenna Technologies Co Ltd ($8227) | | -8.5% | -45.9% | -56.2% | 111.6% |
| China Trends Holdings Ltd ($8171) | | 167.0% | -70.2% | -16.7% | 106.0% |
| |
|---|
| Median (54 companies) | 23.4% | 8.9% | 8.3% | 7.2% | 3.9% |
|---|
| China U-Ton Holdings Ltd ($6168) | | 52.3% | 53.3% | 35.4% | -7.0% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| HKBN Ltd ($1310) | | | 84.3% | 86.5% | 86.9% |
| Netel Technology Holdings Ltd ($8256) | 40.8% | 27.9% | 42.1% | 54.9% | 72.3% |
| Great World Co Holdings Ltd ($8003) | 34.2% | -11.0% | 43.0% | 45.5% | 67.9% |
| APT Satellite Holdings Ltd ($1045) | 52.3% | 58.7% | 64.1% | 62.5% | 61.0% |
| Cisco Systems Inc ($4333) | 61.4% | 61.2% | 60.6% | 58.9% | 60.4% |
| |
|---|
| Median (48 companies) | 27.3% | 21.9% | 24.3% | 25.0% | 22.3% |
|---|
| China U-Ton Holdings Ltd ($6168) | 46.4% | 44.4% | 39.1% | 31.7% | 30.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Asia Satellite Telecommunications Holdings Ltd ($1135) | 83.5% | 86.5% | 85.8% | 81.6% | 82.4% |
| APT Satellite Holdings Ltd ($1045) | 76.7% | 81.0% | 78.9% | 77.5% | 78.8% |
| Synertone Communication Corp ($1613) | 49.5% | 44.9% | 48.5% | 49.4% | 51.5% |
| HKBN Ltd ($1310) | | | 39.2% | 40.1% | 39.0% |
| China Mobile Ltd ($941) | 47.1% | 43.7% | 38.2% | 36.9% | 36.0% |
| |
|---|
| Median (54 companies) | 9.9% | 9.0% | 6.4% | 7.3% | 9.3% |
|---|
| China U-Ton Holdings Ltd ($6168) | 40.6% | 35.6% | 28.4% | 20.2% | 16.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| APT Satellite Holdings Ltd ($1045) | 155.2% | 74.3% | 2.5% | 27.2% | 115.8% |
| Hong Kong Television Network Ltd ($1137) | | 12,435.9% | 504.9% | 1,283.5% | 79.4% |
| Asia Satellite Telecommunications Holdings Ltd ($1135) | 61.8% | 93.8% | 71.7% | 75.0% | 52.8% |
| China Unicom Hong Kong Ltd ($762) | 37.2% | 34.9% | 24.7% | 24.4% | 31.9% |
| China Fiber Optic Network System Group Ltd ($3777) | 24.5% | 4.8% | 16.3% | 13.1% | 31.9% |
| |
|---|
| Median (54 companies) | 3.0% | 2.4% | 3.3% | 3.6% | 2.9% |
|---|
| China U-Ton Holdings Ltd ($6168) | 1.2% | 3.2% | 3.0% | 2.0% | 1.6% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Telecom Service One Holdings Ltd ($8145) | | 95.0% | 5.4% | 26.7% | 39.8% |
| VTech Holdings Ltd ($303) | 40.5% | 37.6% | 39.5% | 40.0% | 39.8% |
| Coolpad Group Ltd ($2369) | 7.2% | 8.1% | 6.0% | 9.6% | 29.1% |
| SmarTone Telecommunications Holdings Ltd ($315) | 30.2% | 37.2% | 23.1% | 12.8% | 17.7% |
| TCL Communication Technology Holdings Ltd ($2618) | 6.4% | -1.6% | 6.0% | 17.2% | 13.4% |
| |
|---|
| Median (55 companies) | 7.1% | 6.6% | 5.9% | 6.2% | 5.4% |
|---|
| China U-Ton Holdings Ltd ($6168) | 69.5% | 35.7% | 25.0% | 16.2% | 8.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| CCT Land Holdings Ltd ($261) | | 10.1x | 23.8x | 48.4x | 44.8x |
| China Energine International Holdings Ltd ($1185) | | | | 13.3x | 31.7x |
| China Ground Source Energy Industry Group Ltd ($8128) | -0.6x | -1.6x | 3.5x | 14.3x | 11.3x |
| China Electronics Corp Holdings Co Ltd ($85) | -2.1x | -2.0x | -1.3x | 12.5x | 7.6x |
| China All Access Holdings Ltd ($633) | -1.0x | 0.9x | 1.8x | 5.2x | 5.6x |
| |
|---|
| Median (40 companies) | -0.2x | -0.1x | 0.8x | 0.9x | 0.5x |
|---|
| China U-Ton Holdings Ltd ($6168) | -0.5x | -1.0x | -1.0x | -0.3x | 3.5x |
