Kiu Hung International Holdings Ltd reports 2.5% revenue decline in 2015 and 12.0 pp EBITDA Margin decline from -15.5% to -27.5%
01/04/2016 • About Kiu Hung International Holdings Ltd (
$381) • By InTwits
Kiu Hung International Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Kiu Hung International Holdings Ltd doesn't have a profitable business model yet: 2015 ROIC is -11.8%
- The company operates at negative EBITDA Margin: -27.5%
- Kiu Hung International Holdings Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2011-2015 is 0.0%. Average EBITDA Margin for the same period was -20.6%0
- Kiu Hung International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.6%. At the same time it's a lot of higher than industry average of 3.7%.
- CAPEX is quite volatile: 1.7 in 2015, 5.1 in 2014, 2.0 in 2013, 11.8 in 2012, 14.1 in 2011
- The company has unprofitable business model: ROIC is at -11.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Kiu Hung International Holdings Ltd ($381) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 184.6 | 192.8 | 169.9 | 229.0 | 223.3 | -2.5% |
| Gross Profit | 38.3 | 59.5 | 49.3 | 73.6 | 79.7 | 8.3% |
| SG&A | 79.3 | 84.9 | 78.2 | 114.4 | 155.8 | 36.2% |
| EBITDA | -34.3 | -16.7 | -57.8 | -35.4 | -61.4 | 73.5% |
| Net Income | -40.5 | -508.9 | -71.8 | -509.6 | -89.7 | -82.4% |
Balance Sheet
|
|---|
| Cash | 13.0 | 23.4 | 18.7 | 20.1 | 13.8 | -31.7% |
| Short Term Debt | 63.4 | 56.7 | 76.2 | 63.8 | 219.1 | 243.2% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 20.2 | 78.9 | 290.7% |
Cash flow
|
|---|
| Capex | 14.1 | 11.8 | 2.0 | 5.1 | 1.7 | -66.9% |
Ratios
|
|---|
| Revenue growth | -0.8% | 4.5% | -11.9% | 34.8% | -2.5% | |
| EBITDA growth | 10.2% | -51.5% | 247.0% | -38.8% | 73.5% | |
| Gross Margin | 20.8% | 30.9% | 29.0% | 32.1% | 35.7% | 3.5% |
| EBITDA Margin | -18.6% | -8.6% | -34.0% | -15.5% | -27.5% | -12.0% |
| Net Income Margin | -22.0% | -263.9% | -42.3% | -222.5% | -40.2% | 182.4% |
| SG&A, % of revenue | 43.0% | 44.0% | 46.0% | 49.9% | 69.8% | 19.8% |
| CAPEX, % of revenue | 7.6% | 6.1% | 1.2% | 2.2% | 0.8% | -1.5% |
| ROIC | -5.2% | -4.1% | -24.6% | -12.5% | -11.8% | 0.7% |
| ROE | -7.2% | -116.4% | -44.0% | -245.3% | -26.6% | 218.7% |
Revenue and profitability
The company's Revenue decreased on 2.5% in 2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 12.0 pp from -15.5% to -27.5% in 2015.
Gross Margin increased on 3.5 pp from 32.1% to 35.7% in 2015. SG&A as a % of Revenue surged on 19.8 pp from 49.9% to 69.8% in 2015.
Net Income marign jumped on 182 pp from -223% to -40.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 the company had CAPEX/Revenue of 0.76%. Kiu Hung International Holdings Ltd's CAPEX/Revenue decreased on 5.4 pp from 6.1% in 2012 to 0.76% in 2015. It's average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at negative ROIC (-11.77%) and ROE (-26.62%). ROIC increased slightly on 0.70 pp from -12.5% to -11.8% in 2015. ROE surged on 219 pp from -245% to -26.6% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.0x and Debt / EBITDA is . Net Debt / EBITDA didn't change in 2015. Debt surged on 255% in 2015 while cash dropped on 31.7% in 2015.
Appendix 1: Peers in Toys/Games/Hobbies
Below we provide Kiu Hung International Holdings Ltd benchmarking against other companies in Toys/Games/Hobbies 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 |
|---|
| Leyou Technologies Holdings Ltd ($1089) | | 18.8% | 32.3% | 17.7% | 31.0% |
| Kin Yat Holdings Ltd ($638) | | -5.9% | 8.8% | 5.0% | 17.1% |
| Dream International Ltd ($1126) | | 24.9% | -0.1% | 21.0% | 10.8% |
| Matrix Holdings Ltd ($1005) | | -0.2% | 17.5% | 12.2% | 10.1% |
| Kader Holdings Co Ltd ($180) | | -3.7% | -25.8% | -11.1% | 8.3% |
| |
|---|
| Median (9 companies) | | 18.8% | 17.5% | 12.2% | 8.3% |
|---|
| Kiu Hung International Holdings Ltd ($381) | | 4.5% | -11.9% | 34.8% | -2.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Playmates Holdings Ltd ($635) | 68.1% | 65.7% | 66.1% | 64.7% | 65.6% |
| Playmates Toys Ltd ($869) | 28.6% | 60.3% | 62.8% | 61.9% | 61.6% |
| Green International Holdings Ltd ($2700) | 12.8% | 17.8% | 1.8% | 8.1% | 59.2% |
| Matrix Holdings Ltd ($1005) | 35.2% | 34.3% | 37.1% | 38.4% | 36.9% |
| Dream International Ltd ($1126) | 24.3% | 25.6% | 29.1% | 22.4% | 23.5% |
| |
|---|
| Median (8 companies) | 21.3% | 21.7% | 21.0% | 17.5% | 30.2% |
|---|
| Kiu Hung International Holdings Ltd ($381) | 20.8% | 30.9% | 29.0% | 32.1% | 35.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Playmates Holdings Ltd ($635) | -14.7% | 22.0% | 36.7% | 33.5% | 32.8% |
| Playmates Toys Ltd ($869) | -186.4% | 15.1% | 33.0% | 30.2% | 25.8% |
| Kader Holdings Co Ltd ($180) | -6.7% | -4.2% | -3.0% | 5.8% | 23.0% |
| Matrix Holdings Ltd ($1005) | 11.0% | 10.2% | 13.2% | 15.0% | 17.4% |
| Dream International Ltd ($1126) | 10.3% | 13.2% | 14.8% | 9.8% | 12.9% |
| |
|---|
| Median (9 companies) | 8.9% | 9.8% | 8.4% | 8.8% | 12.9% |
|---|
| Kiu Hung International Holdings Ltd ($381) | -18.6% | -8.6% | -34.0% | -15.5% | -27.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Green International Holdings Ltd ($2700) | 0.1% | 0.2% | 3.2% | 6.5% | 29.2% |
| Playmates Holdings Ltd ($635) | 44.9% | 11.5% | 4.5% | 2.0% | 15.4% |
| Dream International Ltd ($1126) | 2.6% | 2.9% | 3.8% | 11.2% | 7.3% |
| Kin Yat Holdings Ltd ($638) | 7.9% | 9.8% | 4.6% | 7.5% | 4.8% |
| Leyou Technologies Holdings Ltd ($1089) | 15.7% | 15.8% | 3.8% | 2.6% | 4.5% |
| |
|---|
| Median (9 companies) | 4.0% | 3.5% | 3.7% | 2.8% | 4.5% |
|---|
| Kiu Hung International Holdings Ltd ($381) | 7.6% | 6.1% | 1.2% | 2.2% | 0.8% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Playmates Toys Ltd ($869) | -48.9% | 30.7% | 121.1% | 73.0% | 36.6% |
| Matrix Holdings Ltd ($1005) | 5.8% | 5.9% | 13.1% | 18.6% | 21.2% |
| Dream International Ltd ($1126) | 12.4% | 19.3% | 19.4% | 13.3% | 19.4% |
| Kader Holdings Co Ltd ($180) | -8.5% | -5.7% | -3.9% | 0.6% | 7.9% |
| Playmates Holdings Ltd ($635) | -1.0% | 2.4% | 12.6% | 12.0% | 7.9% |
| |
|---|
| Median (9 companies) | 8.6% | 5.9% | 12.6% | 9.1% | 7.9% |
|---|
| Kiu Hung International Holdings Ltd ($381) | -5.2% | -4.1% | -24.6% | -12.5% | -11.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Quali-Smart Holdings Ltd ($1348) | 1.2x | 0.6x | -0.7x | 0.9x | 4.5x |
| Kader Holdings Co Ltd ($180) | | | | 9.6x | 1.5x |
| Leyou Technologies Holdings Ltd ($1089) | -1.4x | 1.1x | 4.4x | 3.8x | 1.2x |
| Kin Yat Holdings Ltd ($638) | 0.0x | 1.6x | 0.3x | 0.4x | -0.0x |
| Matrix Holdings Ltd ($1005) | 0.5x | 0.6x | 0.0x | -0.2x | -0.6x |
| |
|---|
| Median (8 companies) | 0.2x | 0.6x | -0.4x | 0.1x | -0.3x |
|---|
