Sa Sa International Holdings Ltd Net Income dropped on 54.3% in 2016 and EBITDA Margin decreased on 5.4 pp from 12.8% to 7.4%
23/06/2016 • About Sa Sa International Holdings Ltd (
$178) • By InTwits
Sa Sa International Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is declining: 7.4% in FY2016 vs. 12.8% in FY2015 vs. 14.8% in FY2012
- Sa Sa International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.5%. At the same time it's a lot of higher than industry average of 8.6%.
- CAPEX is quite volatile: 3,221 in FY2016, 1,499 in FY2015, 798 in FY2014, 2,105 in FY2013, 52.4 in FY2012
- The company has highly profitable business model: ROIC is at 19.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sa Sa International Holdings Ltd ($178) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 6,405 | 7,670 | 8,756 | 8,993 | 7,846 | -12.8% |
| Gross Profit | 2,897 | 3,558 | 4,073 | 4,039 | 3,346 | -17.2% |
| SG&A | 1,991 | 2,460 | 2,881 | 3,004 | 2,881 | -4.1% |
| EBITDA | 945 | 1,156 | 1,294 | 1,154 | 581 | -49.6% |
| Net Income | 690 | 826 | 935 | 839 | 383 | -54.3% |
Balance Sheet
|
|---|
| Cash | 563 | 543 | 419 | 520 | 686 | 32.0% |
| Short Term Debt | 0 | 0 | 80 | 0 | 0 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 247 | 192 | 268 | 150 | 117 | -21.9% |
Ratios
|
|---|
| Revenue growth | 30.7% | 19.7% | 14.2% | 2.7% | -12.8% | |
| EBITDA growth | 39.6% | 22.3% | 11.9% | -10.9% | -49.6% | |
| Gross Margin | 45.2% | 46.4% | 46.5% | 44.9% | 42.6% | -2.3% |
| EBITDA Margin | 14.8% | 15.1% | 14.8% | 12.8% | 7.4% | -5.4% |
| Net Income Margin | 10.8% | 10.8% | 10.7% | 9.3% | 4.9% | -4.4% |
| SG&A, % of revenue | 31.1% | 32.1% | 32.9% | 33.4% | 36.7% | 3.3% |
| CAPEX, % of revenue | 3.9% | 2.5% | 3.1% | 1.7% | 1.5% | -0.2% |
| ROIC | 53.5% | 52.7% | 49.0% | 39.8% | 19.0% | -20.8% |
| ROE | 46.2% | 45.8% | 43.5% | 35.0% | 16.1% | -18.9% |
| Net Debt/EBITDA | -0.6x | -0.5x | -0.3x | -0.5x | -1.2x | -0.7x |
Revenue and profitability
Sa Sa International Holdings Ltd's Revenue dropped on 12.8%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 5.4 pp from 12.8% to 7.4% in FY2016.
Gross Margin decreased on 2.3 pp from 44.9% to 42.6% in FY2016. SG&A as a % of Revenue increased on 3.3 pp from 33.4% to 36.7% in FY2016.
Net Income marign decreased on 4.4 pp from 9.3% 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 slightly on 1.0 pp from 2.5% in FY2013 to 1.5% in FY2016. It's average CAPEX/Revenue for the last three years was 2.1%.
Return on investment
The company operates at good ROIC (18.97%) and ROE (16.10%). ROIC dropped on 20.8 pp from 39.8% to 19.0% in FY2016. ROE dropped on 18.9 pp from 35.0% to 16.1% in FY2016.
Leverage (Debt)
The company has no debt. Cash jumped on 32.0%.
Appendix 1: Peers in Retail
Below you can find Sa Sa International Holdings 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 (117 companies) | 7.6% | 6.1% | 2.9% | -1.0% | -5.8% |
|---|
| Sa Sa International Holdings Ltd ($178) | | 19.7% | 14.2% | 2.7% | -12.8% |
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) | 36.2% | 35.8% | 35.0% | 33.3% | 39.5% |
|---|
| Sa Sa International Holdings Ltd ($178) | 45.2% | 46.4% | 46.5% | 44.9% | 42.6% |
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 (117 companies) | 10.3% | 7.3% | 8.9% | 7.1% | 4.7% |
|---|
| Sa Sa International Holdings Ltd ($178) | 14.8% | 15.1% | 14.8% | 12.8% | 7.4% |
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 (117 companies) | 4.1% | 3.6% | 3.8% | 3.5% | 1.7% |
|---|
| Sa Sa International Holdings Ltd ($178) | 3.9% | 2.5% | 3.1% | 1.7% | 1.5% |
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% | |
| JC Group Holdings Ltd ($8326) | | 215.6% | 92.8% | 66.3% | 81.7% |
| Starbucks Corp ($4337) | 36.4% | -6.0% | 52.8% | 51.4% | |
| 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 (117 companies) | 12.2% | 8.8% | 8.5% | 5.8% | 5.2% |
|---|
| Sa Sa International Holdings Ltd ($178) | 53.5% | 52.7% | 49.0% | 39.8% | 19.0% |
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 | 8.5x |
| 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 (91 companies) | -0.5x | -0.6x | -0.2x | -0.5x | -0.6x |
|---|
| Sa Sa International Holdings Ltd ($178) | -0.6x | -0.5x | -0.3x | -0.5x | -1.2x |
