Tse Sui Luen Jewellery International Ltd Debt jumped on 14.7% in 2016 and Net Debt / EBITDA surged on 0.6x from 4.5x to 5.1x
23/05/2016 • About Tse Sui Luen Jewellery International Ltd (
$417) • By InTwits
Tse Sui Luen Jewellery International Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Tse Sui Luen Jewellery International Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.5%. At the same time it's a lot of higher than industry average of 10.4%.
- CAPEX is quite volatile: 1,697 in FY2016, 4,309 in FY2015, 4,661 in FY2014, 762 in FY2013, 1,309 in FY2012
- The company has potentially unprofitable business model: ROIC is at 5.2%
- It operates with high leverage: Net Debt/EBITDA is 5.1x while industry average is -0.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Tse Sui Luen Jewellery International Ltd ($417) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 3,359 | 3,563 | 4,057 | 3,871 | 3,539 | -8.6% |
| Gross Profit | 1,609 | 1,668 | 1,774 | 1,799 | 1,612 | -10.4% |
| SG&A | | 1,537 | 1,632 | 1,687 | 1,505 | -10.8% |
| EBITDA | 292 | 193 | 194 | 175 | 168 | -4.0% |
| Net Income | 162 | 68 | 75 | 40 | 24 | -40.6% |
Balance Sheet
|
|---|
| Cash | 103 | 206 | 141 | 130 | 203 | 55.7% |
| Short Term Debt | 437 | 374 | 579 | 617 | 724 | 17.2% |
| Long Term Debt | 3 | 257 | 279 | 307 | 336 | 9.5% |
Cash flow
|
|---|
| Capex | 61 | 41 | 56 | 57 | 59 | 3.7% |
Ratios
|
|---|
| Revenue growth | 33.4% | 6.1% | 13.9% | -4.6% | -8.6% | |
| EBITDA growth | 13.0% | -33.8% | 0.4% | -9.9% | -4.0% | |
| Gross Margin | 47.9% | 46.8% | 43.7% | 46.5% | 45.5% | -0.9% |
| EBITDA Margin | 8.7% | 5.4% | 4.8% | 4.5% | 4.7% | 0.2% |
| Net Income Margin | 4.8% | 1.9% | 1.8% | 1.0% | 0.7% | -0.4% |
| SG&A, % of revenue | | 43.1% | 40.2% | 43.6% | 42.5% | -1.1% |
| CAPEX, % of revenue | 1.8% | 1.2% | 1.4% | 1.5% | 1.7% | 0.2% |
| ROIC | 18.1% | 9.1% | 8.2% | 6.2% | 5.2% | -1.0% |
| ROE | 18.6% | 7.1% | 7.2% | 3.7% | 2.2% | -1.4% |
| Net Debt/EBITDA | 1.2x | 2.2x | 3.7x | 4.5x | 5.1x | 0.6x |
Revenue and profitability
Tse Sui Luen Jewellery International Ltd's Revenue decreased on 8.6%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 7.8 pp from 9.1% to 1.2% in FY2016.
Gross Margin decreased slightly on 0.93 pp from 46.5% to 45.5% in FY2016. SG&A as a % of Revenue decreased slightly on 1.1 pp from 43.6% to 42.5% in FY2016.
Net Income marign showed almost no change in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Tse Sui Luen Jewellery International Ltd had CAPEX/Revenue of 1.7%. The company showed small growth in CAPEX/Revenue of 0.50 pp from 1.2% in FY2013 to 1.7% in FY2016. For the last three years the average CAPEX/Revenue was 1.5%.
Return on investment
The company operates at low ROIC (5.16%) and ROE (2.22%). ROIC decreased slightly on 1.00 pp from 6.2% to 5.2% in FY2016. ROE decreased slightly on 1.4 pp from 3.7% to 2.2% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 5.1x and Debt / EBITDA is 6.3x. Net Debt / EBITDA surged on 0.6x from 4.5x to 5.1x in FY2016. Debt surged on 14.7% while cash surged on 55.7%.
Appendix 1: Peers in Retail
Below you can find Tse Sui Luen Jewellery International Ltd benchmarking vs. other companies in Retail 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Nuclear Industry 23 International Corp Ltd ($611) | 1.4% | 85.6% | -42.1% | 419.8% | |
| Noble House China Holdings Ltd ($8246) | -5.0% | -20.2% | -24.8% | 117.2% | |
| Vongroup Ltd ($318) | -46.9% | 23.7% | -80.2% | 90.3% | |
| Nanjing Sinolife United Co Ltd ($3332) | 45.6% | 29.5% | 29.6% | 57.3% | |
| Shanghai La Chapelle Fashion Co Ltd ($6116) | 54.9% | 72.8% | 23.0% | 48.3% | |
| |
|---|
| Median (115 companies) | 10.4% | 6.5% | 3.1% | -1.0% | 4.2% |
|---|
| Tse Sui Luen Jewellery International Ltd ($417) | | 6.1% | 13.9% | -4.6% | -8.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Vongroup Ltd ($318) | | | 95.1% | 99.1% | |
| Modern Beauty Salon Holdings Ltd ($919) | 97.4% | 95.9% | 96.8% | 96.7% | |
| Moiselle International Holdings Ltd ($130) | 81.2% | 83.8% | 80.6% | 83.2% | |
| Embry Holdings Ltd ($1388) | 81.2% | 80.4% | 82.3% | 81.6% | |
| Nanjing Sinolife United Co Ltd ($3332) | 86.5% | 89.3% | 90.9% | 80.6% | |
| |
|---|
| Median (102 companies) | 36.7% | 36.3% | 35.3% | 33.6% | 48.4% |
|---|
| Tse Sui Luen Jewellery International Ltd ($417) | 47.9% | 46.8% | 43.7% | 46.5% | 45.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Energy Development Holdings Ltd ($228) | -58.1% | -72.3% | -84.0% | 1,070.6% | |
| Golden Eagle Retail Group Ltd ($3308) | 48.5% | 47.3% | 42.8% | 55.4% | |
| Nanjing Sinolife United Co Ltd ($3332) | 51.6% | 56.9% | 54.4% | 44.8% | |
| Lifestyle International Holdings Ltd ($1212) | 47.5% | 47.0% | 44.7% | 43.4% | |
| China Dongxiang Group Co Ltd ($3818) | 6.0% | 5.6% | 58.3% | 41.4% | |
| |
|---|
| Median (115 companies) | 10.8% | 7.8% | 9.1% | 7.4% | 9.2% |
|---|
| Tse Sui Luen Jewellery International Ltd ($417) | 8.7% | 5.4% | 4.8% | 4.5% | 4.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Culture Landmark Investment Ltd ($674) | 11.6% | 19.4% | 15.7% | 47.2% | |
| Springland International Holdings Ltd ($1700) | 31.9% | 17.4% | 26.5% | 36.9% | |
| Merry Garden Holdings Ltd ($1237) | 18.6% | 28.6% | 15.1% | 34.2% | |
| China Energy Development Holdings Ltd ($228) | 1.6% | 0.2% | 0.0% | 27.4% | |
| Golden Eagle Retail Group Ltd ($3308) | 28.5% | 9.4% | 26.7% | 25.4% | |
| |
|---|
| Median (115 companies) | 4.5% | 3.7% | 3.8% | 3.5% | 1.9% |
|---|
| Tse Sui Luen Jewellery International Ltd ($417) | 1.8% | 1.2% | 1.4% | 1.5% | 1.7% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Modern Beauty Salon Holdings Ltd ($919) | 50.7% | -4.6% | 81.3% | 71.8% | |
| Starbucks Corp ($4337) | 36.4% | -6.0% | 52.8% | 51.4% | |
| Sa Sa International Holdings Ltd ($178) | 53.5% | 52.7% | 49.0% | 39.8% | |
| Noble House China Holdings Ltd ($8246) | 17.7% | -67.7% | -113.8% | 35.6% | |
| Fairwood Holdings Ltd ($52) | 28.0% | 29.1% | 28.6% | 32.1% | |
| |
|---|
| Median (115 companies) | 12.2% | 8.5% | 8.5% | 5.8% | 14.8% |
|---|
| Tse Sui Luen Jewellery International Ltd ($417) | 18.1% | 9.1% | 8.2% | 6.2% | 5.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sparkle Roll Group Ltd ($970) | 0.6x | 4.0x | 9.3x | 23.5x | |
| Trinity Ltd ($891) | -0.2x | 0.2x | 0.6x | 18.2x | |
| Parkson Retail Group Ltd ($3368) | 0.8x | 2.3x | 3.6x | 9.8x | |
| Maoye International Holdings Ltd ($848) | 2.9x | 3.3x | 3.4x | 9.0x | |
| Century Ginwa Retail Holdings Ltd ($162) | 2.0x | 2.5x | 4.8x | 7.3x | |
| |
|---|
| Median (89 companies) | -0.5x | -0.7x | -0.2x | -0.5x | -1.2x |
|---|
| Tse Sui Luen Jewellery International Ltd ($417) | 1.2x | 2.2x | 3.7x | 4.5x | 5.1x |
