Hong Kong Economic Times Holdings Ltd reports 15.1% EBITDA growth in 2016 and 0.94 pp EBITDA Margin growth from 9.6% to 10.6%
20/06/2016 • About Hong Kong Economic Times Holdings Ltd (
$423) • By InTwits
Hong Kong Economic Times Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 10.6% in FY2016, 9.6% in FY2015, 8.1% in FY2014, 3.4% in FY2013, 12.9% in FY2012
- Hong Kong Economic Times Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.0%. At the same time it's in pair with industry average of 8.4%.
- CAPEX is quite volatile: 18.2 in FY2016, 112 in FY2015, 14.0 in FY2014, 87.7 in FY2013, 84.9 in FY2012
- The company has potentially unprofitable business model: ROIC is at 7.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Hong Kong Economic Times Holdings Ltd ($423) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,006 | 1,033 | 1,065 | 1,122 | 1,176 | 4.9% |
| Gross Profit | 387 | 321 | 363 | 399 | 429 | 7.5% |
| SG&A | | 174 | 174 | 182 | 195 | 6.9% |
| EBITDA | 130 | 35 | 86 | 108 | 124 | 15.1% |
| Net Income | 76 | 63 | 28 | 45 | 57 | 26.7% |
Balance Sheet
|
|---|
| Cash | 168 | 279 | 172 | 136 | 117 | -13.9% |
| Short Term Debt | 0 | 24 | 30 | 38 | 8 | -78.9% |
| Long Term Debt | 0 | 90 | 82 | 82 | 22 | -72.9% |
Cash flow
|
|---|
| Capex | 85 | 88 | 14 | 112 | 18 | -83.7% |
Ratios
|
|---|
| Revenue growth | 5.6% | 2.7% | 3.1% | 5.3% | 4.9% | |
| EBITDA growth | -36.7% | -72.8% | 143.8% | 25.1% | 15.1% | |
| Gross Margin | 38.5% | 31.1% | 34.1% | 35.6% | 36.5% | 0.9% |
| EBITDA Margin | 12.9% | 3.4% | 8.1% | 9.6% | 10.6% | 0.9% |
| Net Income Margin | 7.6% | 6.1% | 2.6% | 4.0% | 4.9% | 0.8% |
| SG&A, % of revenue | | 16.8% | 16.4% | 16.2% | 16.6% | 0.3% |
| CAPEX, % of revenue | 8.4% | 8.5% | 1.3% | 10.0% | 1.5% | -8.4% |
| ROIC | 11.5% | -1.5% | 3.2% | 5.2% | 7.0% | 1.8% |
| ROE | 9.9% | 8.1% | 3.5% | 5.6% | 6.9% | 1.3% |
| Net Debt/EBITDA | -1.3x | -4.6x | -0.7x | -0.1x | -0.7x | -0.6x |
Revenue and profitability
Hong Kong Economic Times Holdings Ltd's Revenue increased on 4.9%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 4.6 pp from 26.5% to 21.9% in FY2016.
Gross Margin increased slightly on 0.88 pp from 35.6% to 36.5% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased slightly on 0.84 pp from 4.0% to 4.9% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 1.5%. CAPEX/Revenue decreased on 6.9 pp from 8.5% in FY2013 to 1.5% in FY2016. It's average CAPEX/Revenue for the last three years was 4.3%.
Return on investment
The company operates at low ROIC (6.99%) and ROE (6.94%). ROIC increased slightly on 1.8 pp from 5.2% to 7.0% in FY2016. ROE increased slightly on 1.3 pp from 5.6% to 6.9% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.7x and Debt / EBITDA is 0.2x. Net Debt / EBITDA dropped on 0.6x from -0.1x to -0.7x in FY2016. Debt dropped on 74.8% while cash dropped on 13.9%.
Appendix 1: Peers in Media
Below we provide Hong Kong Economic Times Holdings Ltd benchmarking against other companies in Media 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 |
|---|
| CMMB Vision Holdings Ltd ($471) | | 168.1% | 27.8% | 850.0% | |
| SCMP Group Ltd ($583) | 7.8% | 12.5% | -95.9% | 12.5% | |
| Modern Media Holdings ($72) | 11.8% | -3.7% | -4.3% | -1.3% | |
| Focus Media Network Ltd ($8112) | -10.6% | 34.6% | 5.6% | -5.2% | |
| Sing Tao News Corp Ltd ($1105) | -7.5% | -7.9% | -2.4% | -6.2% | |
| |
|---|
| Median (18 companies) | 4.4% | -1.9% | -4.3% | -9.2% | -18.6% |
|---|
| Hong Kong Economic Times Holdings Ltd ($423) | | 2.7% | 3.1% | 5.3% | 4.9% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| I-CABLE Communications Ltd ($1097) | 94.8% | 94.7% | 94.1% | 94.4% | |
| Focus Media Network Ltd ($8112) | 68.0% | 67.2% | 50.8% | 57.6% | |
| Television Broadcasts Ltd ($511) | 62.9% | 60.9% | 59.0% | 54.9% | |
| One Media Group Ltd ($426) | 57.3% | 56.7% | 54.5% | 52.7% | |
| Modern Media Holdings ($72) | 57.5% | 55.8% | 55.6% | 50.8% | |
| |
|---|
| Median (15 companies) | 38.1% | 40.5% | 36.2% | 37.3% | 38.2% |
|---|
| Hong Kong Economic Times Holdings Ltd ($423) | 38.5% | 31.1% | 34.1% | 35.6% | 36.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SCMP Group Ltd ($583) | 23.5% | 20.5% | 218.1% | 193.5% | |
| Media Chinese International Ltd ($685) | 20.0% | 18.3% | 18.1% | 16.5% | 14.3% |
| One Media Group Ltd ($426) | 18.7% | 23.0% | 22.8% | 15.2% | |
| Phoenix Satellite Television Holdings Ltd ($2008) | 30.1% | 31.1% | 24.6% | 14.1% | |
| Oriental Press Group ($18) | 9.5% | 12.8% | 14.6% | 13.9% | |
| |
|---|
| Median (18 companies) | 9.9% | 11.6% | 12.5% | 9.0% | 3.5% |
|---|
| Hong Kong Economic Times Holdings Ltd ($423) | 12.9% | 3.4% | 8.1% | 9.6% | 10.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SCMP Group Ltd ($583) | 7.0% | 5.3% | 52.2% | 85.2% | |
| Evergrande Health Industry Group Ltd ($708) | 14.6% | 2.4% | 2.9% | 13.5% | |
| I-CABLE Communications Ltd ($1097) | 10.1% | 7.6% | 11.3% | 13.0% | |
| Tom Group Ltd ($2383) | 11.9% | 8.4% | 9.4% | 9.5% | |
| China 33 Media Group Ltd ($8087) | 1.4% | 0.6% | 1.5% | 8.5% | |
| |
|---|
| Median (18 companies) | 2.7% | 5.2% | 2.9% | 5.0% | 1.7% |
|---|
| Hong Kong Economic Times Holdings Ltd ($423) | 8.4% | 8.5% | 1.3% | 10.0% | 1.5% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Media Chinese International Ltd ($685) | 18.6% | 17.8% | 18.4% | 15.6% | 11.1% |
| One Media Group Ltd ($426) | 25.6% | 21.8% | 16.0% | 8.9% | |
| Next Media Ltd ($282) | 8.5% | 6.7% | 8.2% | 6.8% | -1.5% |
| Modern Media Holdings ($72) | 20.6% | 10.4% | 9.3% | 5.5% | |
| Oriental Press Group ($18) | 2.5% | 4.0% | 4.5% | 4.0% | |
| |
|---|
| Median (18 companies) | 3.7% | 5.1% | 2.6% | 0.3% | -1.5% |
|---|
| Hong Kong Economic Times Holdings Ltd ($423) | 11.5% | -1.5% | 3.2% | 5.2% | 7.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tom Group Ltd ($2383) | | | 8.1x | 16.7x | |
| I-CABLE Communications Ltd ($1097) | -4.0x | -0.8x | 0.2x | 2.0x | |
| One Media Group Ltd ($426) | -2.3x | -0.6x | -1.1x | 1.5x | |
| Modern Media Holdings ($72) | -0.8x | -0.9x | 0.1x | 1.0x | |
| Media Chinese International Ltd ($685) | -1.4x | 0.8x | 0.6x | 0.2x | -0.5x |
| |
|---|
| Median (11 companies) | -1.9x | -1.1x | -1.5x | -0.3x | -1.2x |
|---|
| Hong Kong Economic Times Holdings Ltd ($423) | -1.3x | -4.6x | -0.7x | -0.1x | -0.7x |
