Global Sweeteners Holdings Ltd reports 43.5% revenue decline in 2015 and 12.3 pp EBITDA Margin growth from -16.8% to -4.5%
25/04/2016 • About Global Sweeteners Holdings Ltd (
$3889) • By InTwits
Global Sweeteners Holdings Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Global Sweeteners Holdings Ltd is a company in decline: 2015 revenue growth was -43.5%, 5 years revenue CAGR was -13.2%
- The company operates at negative EBITDA Margin: -4.5%
- Global Sweeteners 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 -0.8% for the sames years0
- Global Sweeteners Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.2%. At the same time it's a lot of higher than industry average of 10.6%.
- CAPEX is quite volatile: 15.8 in 2015, 38.8 in 2014, 78.5 in 2013, 95.6 in 2012, 210 in 2011
- The company has unprofitable business model: ROIC is at -12.3%
- It operates with high leverage: Net Debt/EBITDA is -0.6x while industry average is -1.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Global Sweeteners Holdings Ltd ($3889) key annual financial indicators
| mln. HKD | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 4,275 | 4,520 | 4,200 | 2,920 | 1,649 | -43.5% |
| Gross Profit | 545 | 351 | 138 | -190 | 80 | -142.3% |
| SG&A | 337 | 365 | 351 | 322 | 188 | -41.5% |
| EBITDA | 340 | 146 | -70 | -491 | -75 | -84.8% |
| Net Income | 144 | -247 | -320 | -1,093 | -753 | -31.1% |
Balance Sheet
|
|---|
| Cash | 497 | 558 | 407 | 190 | 61 | -67.8% |
| Short Term Debt | 1,754 | 1,479 | 1,326 | 471 | 727 | 54.2% |
| Long Term Debt | 78 | 323 | 37 | 570 | 190 | -66.6% |
Cash flow
|
|---|
| Capex | 210 | 96 | 78 | 39 | 16 | -59.4% |
Ratios
|
|---|
| Revenue growth | 27.4% | 5.7% | -7.1% | -30.5% | -43.5% | |
| EBITDA growth | 19.9% | -57.1% | -147.7% | 605.0% | -84.8% | |
| Gross Margin | 12.7% | 7.8% | 3.3% | -6.5% | 4.9% | 11.4% |
| EBITDA Margin | 8.0% | 3.2% | -1.7% | -16.8% | -4.5% | 12.3% |
| Net Income Margin | 3.4% | -5.5% | -7.6% | -37.4% | -45.7% | -8.3% |
| SG&A, % of revenue | 7.9% | 8.1% | 8.4% | 11.0% | 11.4% | 0.4% |
| CAPEX, % of revenue | 4.9% | 2.1% | 1.9% | 1.3% | 1.0% | -0.4% |
| ROIC | 6.2% | -0.1% | -5.6% | -22.0% | -12.3% | 9.7% |
| ROE | 6.4% | -10.1% | -14.6% | -73.5% | -135.2% | -61.6% |
| Net Debt/EBITDA | 3.9x | 8.5x | | | | 0.0x |
Revenue and profitability
The company's Revenue dropped on 43.5% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 12.3 pp from -16.8% to -4.5% in 2015.
Gross Margin jumped on 11.4 pp from -6.5% to 4.9% in 2015. SG&A as a % of Revenue showed almost no change in 2015.
Net Income marign decreased on 8.3 pp from -37.4% to -45.7% in 2015.
Capital expenditures (CAPEX) and working capital investments
Global Sweeteners Holdings Ltd's CAPEX/Revenue was 0.96% in 2015. Global Sweeteners Holdings Ltd showed small CAPEX/Revenue decline of 1.2 pp from 2.1% in 2012 to 0.96% in 2015. It's average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at negative ROIC (-12.30%) and ROE (-135.17%). ROIC increased on 9.7 pp from -22.0% to -12.3% in 2015. ROE dropped on 61.6 pp from -73.5% to -135% in 2015.
Leverage (Debt)
Debt level is -0.6x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in 2015. Debt dropped on 11.9% in 2015 while cash dropped on 67.8% in 2015.
Management team
The company's CEO Wang Jian has spent 3 years at the company.
Appendix 1: Peers in Food
Below we provide Global Sweeteners Holdings Ltd benchmarking against other companies in Food 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 |
|---|
| Imperial Pacific International Holdings Ltd ($1076) | | -27.6% | -18.5% | 2.7% | 70.3% |
| China Shengmu Organic Milk Ltd ($1432) | | 80.0% | 63.2% | 86.4% | 45.4% |
| Chinese Food and Beverage Group ($8272) | | 207.7% | 149.2% | 26.8% | 31.6% |
| Huisheng International Holdings Ltd ($1340) | | -2.4% | 5.6% | 8.7% | 25.9% |
| Jiashili Group Ltd ($1285) | | 14.9% | 15.1% | 12.3% | 19.8% |
| |
|---|
| Median (41 companies) | 15.8% | 10.3% | 9.8% | 6.4% | -2.3% |
|---|
| Global Sweeteners Holdings Ltd ($3889) | | 5.7% | -7.1% | -30.5% | -43.5% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Hung Fook Tong Group Holdings Ltd ($1446) | 57.0% | 60.7% | 60.0% | 58.7% | 60.7% |
| Honworld Group Ltd ($2226) | 42.2% | 57.2% | 59.0% | 57.8% | 56.4% |
| Yashili International Holdings Ltd ($1230) | 52.0% | 53.7% | 53.5% | 51.2% | 50.8% |
| Natural Dairy NZ Holdings Ltd ($462) | 16.3% | -13.7% | 27.5% | 48.8% | 49.6% |
| China Shengmu Organic Milk Ltd ($1432) | 29.4% | 33.4% | 42.9% | 50.2% | 47.7% |
| |
|---|
| Median (40 companies) | 19.7% | 17.2% | 20.2% | 21.7% | 23.8% |
|---|
| Global Sweeteners Holdings Ltd ($3889) | 12.7% | 7.8% | 3.3% | -6.5% | 4.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Shenguan Holdings Group Ltd ($829) | 57.2% | 58.7% | 59.2% | 54.5% | 43.6% |
| Honworld Group Ltd ($2226) | 28.4% | 44.4% | 42.1% | 42.0% | 42.9% |
| China Shengmu Organic Milk Ltd ($1432) | 58.7% | 31.5% | 38.3% | 47.1% | 41.9% |
| China Huishan Dairy Holdings Co Ltd ($6863) | 109.2% | 45.1% | 47.9% | 47.1% | 37.2% |
| YuanShengTai Dairy Farm Ltd ($1431) | 147.8% | 40.3% | 48.4% | 47.1% | 35.4% |
| |
|---|
| Median (40 companies) | 8.6% | 8.3% | 6.9% | 8.0% | 8.2% |
|---|
| Global Sweeteners Holdings Ltd ($3889) | 8.0% | 3.2% | -1.7% | -16.8% | -4.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| China Huishan Dairy Holdings Co Ltd ($6863) | 453.6% | 98.2% | 29.8% | 132.0% | 109.8% |
| Imperial Pacific International Holdings Ltd ($1076) | 0.0% | 0.0% | 0.0% | 15.6% | 88.5% |
| China Modern Dairy Holdings Ltd ($1117) | 58.9% | 50.6% | | 18.7% | 42.4% |
| Labixiaoxin Snacks Group Ltd ($1262) | 23.0% | 13.3% | 10.3% | 14.6% | 32.0% |
| YuanShengTai Dairy Farm Ltd ($1431) | 182.5% | 26.1% | 18.3% | 43.4% | 30.1% |
| |
|---|
| Median (39 companies) | 3.7% | 5.9% | 5.7% | 5.2% | 5.3% |
|---|
| Global Sweeteners Holdings Ltd ($3889) | 4.9% | 2.1% | 1.9% | 1.3% | 1.0% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Jiashili Group Ltd ($1285) | | 45.6% | 51.8% | 27.8% | 22.2% |
| Want Want China Holdings Ltd ($151) | 24.9% | 27.9% | 29.4% | 22.8% | 21.8% |
| China Shengmu Organic Milk Ltd ($1432) | | 16.4% | 19.6% | 22.5% | 17.3% |
| Honworld Group Ltd ($2226) | 22.1% | 50.4% | 44.5% | 23.6% | 16.5% |
| WH Group Ltd ($288) | | 20.3% | 3.6% | 15.0% | 13.3% |
| |
|---|
| Median (42 companies) | 11.6% | 8.4% | 7.2% | 7.3% | 5.6% |
|---|
| Global Sweeteners Holdings Ltd ($3889) | 6.2% | -0.1% | -5.6% | -22.0% | -12.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ausnutria Dairy Corp Ltd ($1717) | -3.5x | -1.4x | 0.8x | 1.7x | 27.9x |
| Beijing Jingkelong Co Ltd ($814) | 3.4x | 5.0x | 4.8x | 5.3x | 9.3x |
| First Pacific Co Ltd/Hong Kong ($142) | 1.3x | 1.8x | 3.8x | 4.5x | 5.6x |
| China Kangda Food Co Ltd ($834) | 2.1x | 2.8x | 2.5x | 2.3x | 5.4x |
| China Modern Dairy Holdings Ltd ($1117) | 1.3x | 3.7x | 5.2x | 4.1x | 5.3x |
| |
|---|
| Median (32 companies) | 0.2x | -0.4x | 0.8x | 0.8x | 1.2x |
|---|
