Bright Smart Securities & Commodities Group Ltd Net Debt / EBITDA dropped on 35.0x from 39.3x to 4.3x in 2016 and Debt dropped on 81.8%
20/06/2016 • About Bright Smart Securities & Commodities Group Ltd (
$1428) • By InTwits
Bright Smart Securities & Commodities Group Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 60.8% in FY2016 vs. 56.4% in FY2015 vs. 36.7% in FY2012
- Bright Smart Securities & Commodities Group Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.3%. At the same time it's in pair with industry average of 20.9%.
- CAPEX is quite volatile: 10.8 in FY2016, 5.2 in FY2015, 6.4 in FY2014, 3.9 in FY2013, 0.060 in FY2012
- The company has potentially unprofitable business model: ROIC is at 3.8%
- It operates with high leverage: Net Debt/EBITDA is 4.3x while industry average is 1.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Bright Smart Securities & Commodities Group Ltd ($1428) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 266.0 | 331.3 | 487.1 | 608.3 | 788.6 | 29.6% |
| EBITDA | 97.5 | 137.4 | 257.7 | 343.2 | 479.3 | 39.7% |
| Net Income | 60.6 | 92.2 | 166.7 | 218.4 | 325.5 | 49.0% |
Balance Sheet
|
|---|
| Cash | 397.1 | 381.5 | 370.4 | 521.8 | 503.4 | -3.5% |
| Short Term Debt | 605.0 | 1,790.0 | 2,776.0 | 14,010.3 | 2,554.0 | -81.8% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 14.2 | 12.9 | 20.5 | 7.4 | 13.5 | 81.8% |
Ratios
|
|---|
| Revenue growth | 27.3% | 24.6% | 47.0% | 24.9% | 29.6% | |
| EBITDA growth | 53.5% | 40.8% | 87.6% | 33.2% | 39.7% | |
| EBITDA Margin | 36.7% | 41.5% | 52.9% | 56.4% | 60.8% | 4.4% |
| Net Income Margin | 22.8% | 27.8% | 34.2% | 35.9% | 41.3% | 5.4% |
| CAPEX, % of revenue | 5.3% | 3.9% | 4.2% | 1.2% | 1.7% | 0.5% |
| ROIC | 6.3% | 5.9% | 6.2% | 2.6% | 3.8% | 1.2% |
| ROE | 13.0% | 14.7% | 18.9% | 15.9% | 17.2% | 1.3% |
| Net Debt/EBITDA | 2.1x | 10.3x | 9.3x | 39.3x | 4.3x | -35.0x |
Revenue and profitability
The company's Revenue jumped on 29.6%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.4 pp from -6.0% to -3.5% in FY2016.
Net Income marign increased on 5.4 pp from 35.9% to 41.3% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Bright Smart Securities & Commodities Group Ltd had CAPEX/Revenue of 1.7%. CAPEX/Revenue decreased on 2.2 pp from 3.9% in FY2013 to 1.7% in FY2016. For the last three years the average CAPEX/Revenue was 2.4%.
Return on investment
The company operates at good ROE (17.23%) while ROIC is low (3.83%). ROIC increased slightly on 1.2 pp from 2.6% to 3.8% in FY2016. ROE increased slightly on 1.3 pp from 15.9% to 17.2% in FY2016.
Leverage (Debt)
Debt level is 4.3x Net Debt / EBITDA and 5.3x Debt / EBITDA. Net Debt / EBITDA dropped on 35.0x from 39.3x to 4.3x in FY2016. Debt dropped on 81.8% while cash decreased on 3.5%.
Appendix 1: Peers in Diversified Finan Serv
Below we provide Bright Smart Securities & Commodities Group Ltd benchmarking against other companies in Diversified Finan Serv 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Smarter Energy Group Holdings Ltd ($1004) | -4.0% | -23.1% | -87.3% | 1,860.5% | |
| Crown International Corp Ltd ($727) | 225.8% | -75.0% | 117.4% | 802.5% | |
| Global Strategic Group Ltd ($8007) | -3.9% | 2.1% | 806.3% | 681.2% | |
| Upbest Group Ltd ($335) | -38.5% | -61.8% | 24.1% | 208.1% | |
| GF Securities Co Ltd ($1776) | 16.3% | 31.8% | 75.0% | 163.9% | |
| |
|---|
| Median (64 companies) | 1.2% | 14.9% | 26.5% | 24.4% | 17.0% |
|---|
| Bright Smart Securities & Commodities Group Ltd ($1428) | | 24.6% | 47.0% | 24.9% | 29.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Roma Group Ltd ($8072) | | | 99.4% | 98.7% | |
| First China Financial Network Holdings Ltd ($8123) | 93.4% | | 94.5% | 97.4% | |
| China Smarter Energy Group Holdings Ltd ($1004) | 6.2% | 4.0% | 46.9% | 96.9% | |
| Chinese Strategic Holdings Ltd ($8089) | 99.1% | 97.9% | 97.0% | 96.6% | |
| Allied Group Ltd ($373) | 95.1% | 94.4% | 93.6% | 92.2% | |
| |
|---|
| Median (12 companies) | 64.2% | 75.1% | 88.2% | 90.3% | |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Smarter Energy Group Holdings Ltd ($1004) | -282.7% | -373.2% | -1,524.9% | 212.2% | |
| China Aircraft Leasing Group Holdings Ltd ($1848) | 91.3% | 86.4% | 92.9% | 107.0% | |
| Get Nice Holdings Ltd ($64) | 2.6% | 153.4% | 92.7% | 83.9% | |
| Hong Kong Exchanges and Clearing Ltd ($388) | 81.6% | 73.4% | 75.7% | 82.1% | |
| Hong Kong Finance Group Co Ltd ($1273) | 76.9% | 67.5% | 65.2% | 74.8% | 70.3% |
| |
|---|
| Median (66 companies) | 18.8% | 36.2% | 47.2% | 31.4% | 55.9% |
|---|
| Bright Smart Securities & Commodities Group Ltd ($1428) | 36.7% | 41.5% | 52.9% | 56.4% | 60.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Aircraft Leasing Group Holdings Ltd ($1848) | 351.0% | 0.1% | 33.3% | 64.6% | |
| Willie International Holdings Ltd ($273) | | 0.3% | 0.8% | 58.0% | |
| China Assurance Finance Group Ltd ($8090) | 94.7% | 68.9% | 53.3% | 51.0% | |
| AID Partners Capital Holdings Ltd ($8088) | 4.1% | 2.9% | 28.4% | 26.6% | |
| Hongkong Chinese Ltd ($655) | | | 0.1% | 25.6% | |
| |
|---|
| Median (65 companies) | 1.9% | 1.8% | 1.1% | 1.5% | 0.1% |
|---|
| Bright Smart Securities & Commodities Group Ltd ($1428) | 5.3% | 3.9% | 4.2% | 1.2% | 1.7% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hong Kong Exchanges and Clearing Ltd ($388) | 29.1% | 20.1% | 21.5% | 29.1% | |
| China Smarter Energy Group Holdings Ltd ($1004) | -19.4% | -23.0% | -14.0% | 22.5% | |
| Oi Wah Pawnshop Credit Holdings Ltd ($1319) | 32.7% | 20.7% | 14.0% | 15.3% | 12.5% |
| Emperor Capital Group Ltd ($717) | 5.1% | 12.8% | 13.1% | 14.6% | |
| Roma Group Ltd ($8072) | 19.6% | 43.7% | 107.8% | 13.3% | 9.8% |
| |
|---|
| Median (69 companies) | 3.9% | 4.0% | 4.8% | 3.6% | 9.8% |
|---|
| Bright Smart Securities & Commodities Group Ltd ($1428) | 6.3% | 5.9% | 6.2% | 2.6% | 3.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hoifu Energy Group Ltd ($7) | | | | 62.5x | |
| South China Financial Holdings Ltd ($619) | | | | 56.9x | |
| Far East Horizon Ltd ($3360) | 16.9x | 21.7x | 20.0x | 20.8x | |
| Quam Ltd ($952) | 58.9x | 15.9x | 4.1x | 14.8x | |
| China Aircraft Leasing Group Holdings Ltd ($1848) | 14.7x | 19.0x | 17.5x | 14.6x | |
| |
|---|
| Median (49 companies) | -0.7x | 0.1x | -0.1x | -0.1x | 3.2x |
|---|
| Bright Smart Securities & Commodities Group Ltd ($1428) | 2.1x | 10.3x | 9.3x | 39.3x | 4.3x |
