Cafe de Coral Holdings Ltd reports 11.7% Net Income decline and 1.3 pp EBITDA Margin decline from 13.4% to 12.1%
22/06/2016 • About Cafe de Coral Holdings Ltd (
$341) • By InTwits
Cafe de Coral Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Cafe de Coral Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.4%. At the same time it's in pair with industry average of 5.6%.
- CAPEX is quite volatile: 11,276 in FY2016, 8,278 in FY2015, 1,005 in FY2014, 871 in FY2013, 2,606 in FY2012
- The company has highly profitable business model: ROIC is at 16.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Cafe de Coral Holdings Ltd ($341) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 5,956 | 6,394 | 6,826 | 7,356 | 7,567 | 2.9% |
| Gross Profit | 814 | 908 | 984 | 1,023 | 1,045 | 2.1% |
| SG&A | 296 | 309 | 287 | 355 | 414 | 16.5% |
| EBITDA | 776 | 880 | 988 | 983 | 914 | -7.0% |
| Net Income | 477 | 540 | 581 | 587 | 518 | -11.7% |
Balance Sheet
|
|---|
| Cash | 854 | 773 | 1,004 | 1,057 | 1,187 | 12.2% |
| Short Term Debt | 0 | 0 | 0 | 0 | 0 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 574 | 491 | 306 | 393 | 360 | -8.5% |
Ratios
|
|---|
| Revenue growth | 11.7% | 7.3% | 6.8% | 7.8% | 2.9% | |
| EBITDA growth | -5.1% | 13.4% | 12.3% | -0.5% | -7.0% | |
| Gross Margin | 13.7% | 14.2% | 14.4% | 13.9% | 13.8% | -0.1% |
| EBITDA Margin | 13.0% | 13.8% | 14.5% | 13.4% | 12.1% | -1.3% |
| Net Income Margin | 8.0% | 8.4% | 8.5% | 8.0% | 6.8% | -1.1% |
| SG&A, % of revenue | 5.0% | 4.8% | 4.2% | 4.8% | 5.5% | 0.6% |
| CAPEX, % of revenue | 9.6% | 7.7% | 4.5% | 5.3% | 4.8% | -0.6% |
| ROIC | 16.4% | 18.0% | 19.8% | 18.6% | 16.9% | -1.7% |
| ROE | 15.0% | 15.8% | 16.0% | 15.9% | 14.4% | -1.5% |
| Net Debt/EBITDA | -1.1x | -0.9x | -1.0x | -1.1x | -1.3x | -0.2x |
Revenue and profitability
Cafe de Coral Holdings Ltd's Revenue increased on 2.9%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 4.7 pp from 19.2% to 23.9% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue increased slightly on 0.64 pp from 4.8% to 5.5% in FY2016.
Net Income marign decreased slightly on 1.1 pp from 8.0% to 6.8% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 4.8%. CAPEX/Revenue decreased on 2.9 pp from 7.7% in FY2013 to 4.8% in FY2016. For the last three years the average CAPEX/Revenue was 4.9%.
Return on investment
The company operates at good ROIC (16.86%) and ROE (14.37%). ROIC decreased slightly on 1.7 pp from 18.6% to 16.9% in FY2016. ROE decreased slightly on 1.5 pp from 15.9% to 14.4% in FY2016.
Leverage (Debt)
The company has no debt. Cash jumped on 12.2%.
Management team
Cafe de Coral Holdings Ltd's CEO is Lo Tak Shing "Peter". Lo Tak Shing "Peter" has 2 years tenure at the company. The company's CFO Lim Hung Chun "Mike" has spent 7 years at the company.
Appendix 1: Peers in Retail
Below we provide Cafe de Coral Holdings Ltd benchmarking against other companies in Retail 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 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 (116 companies) | 9.6% | 6.3% | 3.1% | -1.8% | -5.8% |
|---|
| Cafe de Coral Holdings Ltd ($341) | | 7.3% | 6.8% | 7.8% | 2.9% |
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 (103 companies) | 37.2% | 36.4% | 35.5% | 33.9% | 47.0% |
|---|
| Cafe de Coral Holdings Ltd ($341) | 13.7% | 14.2% | 14.4% | 13.9% | 13.8% |
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 (116 companies) | 9.9% | 7.3% | 8.8% | 6.8% | 4.7% |
|---|
| Cafe de Coral Holdings Ltd ($341) | 13.0% | 13.8% | 14.5% | 13.4% | 12.1% |
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 (116 companies) | 4.1% | 3.6% | 3.7% | 3.1% | 1.7% |
|---|
| Cafe de Coral Holdings Ltd ($341) | 9.6% | 7.7% | 4.5% | 5.3% | 4.8% |
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 (116 companies) | 12.2% | 8.7% | 8.5% | 5.8% | 5.2% |
|---|
| Cafe de Coral Holdings Ltd ($341) | 16.4% | 18.0% | 19.8% | 18.6% | 16.9% |
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 (90 companies) | -0.5x | -0.6x | -0.2x | -0.5x | -0.6x |
|---|
| Cafe de Coral Holdings Ltd ($341) | -1.1x | -0.9x | -1.0x | -1.1x | -1.3x |
