China Technology Solar Power Holdings Ltd revenue jumped on 69.8% while EBITDA Margin decreased on 2.7 pp from 30.7% to 28.1%
23/06/2016 • About China Technology Solar Power Holdings Ltd (
$8111) • By InTwits
China Technology Solar Power 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: 28.1% in FY2016, 30.7% in FY2015, 16.3% in FY2014, 10.4% in FY2013, -80.3% in FY2012
- China Technology Solar Power Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.4%. At the same time it's a lot of higher than industry average of 22.1%.
- CAPEX is quite volatile: 0.64 in FY2016, 0.48 in FY2015, 0.78 in FY2014, 0.038 in FY2013, 1.7 in FY2012
- The company has business model with low profitability: ROIC is at 9.9%
- It operates with high leverage: Net Debt/EBITDA is 0.9x while industry average is -2.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Technology Solar Power Holdings Ltd ($8111) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 31.9 | 52.3 | 74.5 | 113.3 | 192.4 | 69.8% |
| Gross Profit | 7.5 | 18.0 | 27.7 | 44.3 | 74.4 | 67.8% |
| SG&A | | 17.1 | 15.9 | 14.3 | 35.6 | 149.1% |
| EBITDA | -25.6 | 5.4 | 12.2 | 34.8 | 54.0 | 55.1% |
| Net Income | -49.7 | 0.6 | 10.1 | 29.7 | 46.5 | 56.7% |
Balance Sheet
|
|---|
| Cash | 3.8 | 7.6 | 5.5 | 43.8 | 7.6 | -82.6% |
| Short Term Debt | 7.2 | 13.6 | 16.1 | 19.8 | 24.0 | 21.0% |
| Long Term Debt | 44.8 | 34.5 | 29.1 | 32.5 | 32.3 | -0.6% |
Cash flow
|
|---|
| Capex | 1.7 | 0.0 | 0.8 | 0.5 | 0.6 | 33.1% |
Ratios
|
|---|
| Revenue growth | 0.2% | 63.9% | 42.3% | 52.1% | 69.8% | |
| EBITDA growth | 21.3% | -121.2% | 123.8% | 186.2% | 55.1% | |
| Gross Margin | 23.6% | 34.4% | 37.2% | 39.1% | 38.6% | -0.4% |
| EBITDA Margin | -80.3% | 10.4% | 16.3% | 30.7% | 28.1% | -2.7% |
| Net Income Margin | -155.6% | 1.1% | 13.5% | 26.2% | 24.2% | -2.0% |
| SG&A, % of revenue | | 32.8% | 21.4% | 12.6% | 18.5% | 5.9% |
| CAPEX, % of revenue | 5.2% | 0.1% | 1.0% | 0.4% | 0.3% | -0.1% |
| ROIC | -12.6% | 0.3% | 3.9% | 9.7% | 9.9% | 0.2% |
| ROE | -31.4% | 0.3% | 4.2% | 10.7% | 13.2% | 2.6% |
| Net Debt/EBITDA | | 7.4x | 3.3x | 0.2x | 0.9x | 0.7x |
Revenue and profitability
China Technology Solar Power Holdings Ltd's Revenue jumped on 69.8%. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 2.7 pp from 30.7% to 28.1% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue increased on 5.9 pp from 12.6% to 18.5% in FY2016.
Net Income marign decreased on 2.0 pp from 26.2% to 24.2% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 0.33%. China Technology Solar Power Holdings Ltd showed almost no change in CAPEX/Revenue from FY2013 to FY2016. Average CAPEX/Revenue for the last three years was 0.60%.
Return on investment
The company operates at good ROE (13.23%) while ROIC is low (9.92%). ROIC showed almost no change in FY2016. ROE increased on 2.6 pp from 10.7% to 13.2% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.9x and Debt / EBITDA is 1.0x. Net Debt / EBITDA jumped on 0.7x from 0.2x to 0.9x in FY2016. Debt increased on 7.6% while cash dropped on 82.6%.
Appendix 1: Peers in Software
Below we provide China Technology Solar Power Holdings Ltd benchmarking against other companies in Software 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 |
|---|
| Yunbo Digital Synergy Group Ltd ($8050) | | 241.6% | -31.9% | 348.0% | 99.6% |
| Pizu Group Holdings Ltd ($8053) | 40.3% | -42.9% | 1,742.9% | 157.9% | |
| China Eco-Farming Ltd ($8166) | -23.6% | -7.7% | 21.8% | 155.5% | |
| Aurum Pacific China Group Ltd ($8148) | | | 50.0% | 92.7% | |
| Kingsoft Corp Ltd ($3888) | 38.3% | 54.0% | 54.2% | 69.4% | |
| |
|---|
| Median (36 companies) | 21.1% | 11.2% | 21.2% | 5.5% | -10.2% |
|---|
| China Technology Solar Power Holdings Ltd ($8111) | | 63.9% | 42.3% | 52.1% | 69.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Bio Cassava Holdings Ltd ($8129) | 90.4% | 97.4% | 98.4% | 98.3% | |
| Chanjet Information Technology Co Ltd ($1588) | 89.2% | 91.3% | 92.4% | 91.4% | |
| China Binary Sale Technology Ltd ($8255) | 63.5% | 68.5% | 67.7% | 85.9% | |
| Kingdee International Software Group Co Ltd ($268) | 65.0% | 75.3% | 82.5% | 81.5% | |
| Tian Ge Interactive Holdings Ltd ($1980) | 88.5% | 87.6% | 84.8% | 77.7% | |
| |
|---|
| Median (35 companies) | 46.5% | 43.1% | 43.4% | 43.6% | 27.7% |
|---|
| China Technology Solar Power Holdings Ltd ($8111) | 23.6% | 34.4% | 37.2% | 39.1% | 38.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| International Entertainment Corp ($1009) | 50.8% | 64.0% | 54.9% | 62.0% | |
| Sinosoft Technology Group Ltd ($1297) | 62.6% | 54.9% | 57.2% | 59.0% | |
| China Binary Sale Technology Ltd ($8255) | 35.1% | 35.4% | 44.4% | 50.5% | |
| Boyaa Interactive International Ltd ($434) | 38.5% | 25.8% | 30.7% | 47.6% | |
| TravelSky Technology Ltd ($696) | 38.1% | 35.8% | 31.9% | 41.1% | |
| |
|---|
| Median (36 companies) | 11.4% | 17.0% | 10.1% | 9.5% | 0.6% |
|---|
| China Technology Solar Power Holdings Ltd ($8111) | -80.3% | 10.4% | 16.3% | 30.7% | 28.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| NetDragon Websoft Inc ($777) | 21.1% | 34.6% | 54.6% | 42.9% | |
| China Information Technology Development Ltd ($8178) | 4.1% | 1.1% | 0.5% | 40.7% | |
| Aurum Pacific China Group Ltd ($8148) | | 2.9% | 7.5% | 20.6% | |
| TravelSky Technology Ltd ($696) | 8.9% | 21.7% | 18.1% | 18.1% | |
| Kingsoft Corp Ltd ($3888) | 4.3% | 3.8% | 14.3% | 11.1% | |
| |
|---|
| Median (36 companies) | 1.4% | 2.0% | 3.6% | 2.4% | 0.4% |
|---|
| China Technology Solar Power Holdings Ltd ($8111) | 5.2% | 0.1% | 1.0% | 0.4% | 0.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Pizu Group Holdings Ltd ($8053) | -21.8% | -13.4% | -6.8% | 120.0% | |
| IGG Inc ($8002) | | 55.9% | 41.4% | 25.9% | |
| Boyaa Interactive International Ltd ($434) | 75.3% | 21.3% | 20.0% | 21.4% | |
| Sinosoft Technology Group Ltd ($1297) | 34.0% | 21.9% | 20.2% | 20.8% | |
| ITE Holdings Ltd ($8092) | -15.0% | 10.6% | 16.8% | 19.8% | 4.1% |
| |
|---|
| Median (36 companies) | 5.6% | 6.4% | 5.0% | 2.0% | -0.2% |
|---|
| China Technology Solar Power Holdings Ltd ($8111) | -12.6% | 0.3% | 3.9% | 9.7% | 9.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Epicurean and Co Ltd ($8213) | 2.3x | 4.7x | 12.3x | 12.0x | |
| Sing Lee Software Group Ltd ($8076) | | | 6.2x | 4.4x | |
| Century Sage Scientific Holdings Ltd ($1450) | 0.2x | 0.0x | -0.2x | 1.8x | |
| Microsoft Corp ($4338) | | | 0.4x | 1.2x | 1.4x |
| Chinasoft International Ltd ($354) | -0.7x | 0.7x | 1.5x | 0.7x | |
| |
|---|
| Median (20 companies) | -1.1x | -1.9x | -1.6x | -1.1x | -3.8x |
|---|
| China Technology Solar Power Holdings Ltd ($8111) | | 7.4x | 3.3x | 0.2x | 0.9x |
