Stelux Holdings International Ltd reports 88.3% EBITDA decline and 13.7% Revenue decline
23/06/2016 • About Stelux Holdings International Ltd (
$84) • By InTwits
Stelux Holdings International Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Stelux Holdings International Ltd doesn't have a profitable business model yet: FY2016 ROIC is -3.2%
- EBITDA Margin is declining: 1.2% in FY2016 vs. 9.1% in FY2015 vs. 11.9% in FY2012
- EBITDA Margin is quite volatile: 1.2% in FY2016, 9.1% in FY2015, 10.1% in FY2014, 11.2% in FY2013, 11.9% in FY2012
- Stelux Holdings International Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.5%. At the same time it's a lot of higher than industry average of 5.5%.
- CAPEX is quite volatile: 202 in FY2016, 325 in FY2015, 462 in FY2014, 1,583 in FY2013, 421 in FY2012
- The company has unprofitable business model: ROIC is at -3.2%
- It operates with high leverage: Net Debt/EBITDA is 12.5x while industry average is -0.1x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Stelux Holdings International Ltd ($84) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 3,331 | 3,647 | 3,892 | 3,941 | 3,402 | -13.7% |
| Gross Profit | 2,055 | 2,285 | 2,379 | 2,416 | 2,031 | -16.0% |
| SG&A | | 341 | 384 | 414 | 2,064 | 398.7% |
| EBITDA | 396 | 408 | 393 | 357 | 42 | -88.3% |
| Net Income | 250 | 233 | 172 | 92 | -190 | -307.1% |
Balance Sheet
|
|---|
| Cash | 221 | 388 | 458 | 460 | 599 | 30.2% |
| Short Term Debt | 423 | 351 | 464 | 580 | 766 | 32.2% |
| Long Term Debt | 86 | 460 | 402 | 433 | 355 | -18.1% |
Cash flow
|
|---|
| Capex | 152 | 162 | 118 | 96 | 110 | 14.8% |
Ratios
|
|---|
| Revenue growth | 23.1% | 9.5% | 6.7% | 1.3% | -13.7% | |
| EBITDA growth | 54.4% | 2.8% | -3.5% | -9.2% | -88.3% | |
| Gross Margin | 61.7% | 62.7% | 61.1% | 61.3% | 59.7% | -1.6% |
| EBITDA Margin | 11.9% | 11.2% | 10.1% | 9.1% | 1.2% | -7.8% |
| Net Income Margin | 7.5% | 6.4% | 4.4% | 2.3% | -5.6% | -7.9% |
| SG&A, % of revenue | | 9.4% | 9.9% | 10.5% | 60.7% | 50.2% |
| CAPEX, % of revenue | 4.6% | 4.4% | 3.0% | 2.4% | 3.2% | 0.8% |
| ROIC | 19.2% | 14.7% | 11.8% | 10.0% | -3.2% | -13.2% |
| ROE | 23.2% | 18.1% | 12.0% | 6.3% | -14.2% | -20.5% |
| Net Debt/EBITDA | 0.7x | 1.0x | 1.0x | 1.5x | 12.5x | 11.0x |
Revenue and profitability
Stelux Holdings International Ltd's Revenue dropped on 13.7%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.6 pp from 14.0% to 15.7% in FY2016.
Gross Margin decreased slightly on 1.6 pp from 61.3% to 59.7% in FY2016. SG&A as a % of Revenue surged on 50.2 pp from 10.5% to 60.7% in FY2016.
Net Income marign decreased on 7.9 pp from 2.3% to -5.6% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 3.2%. CAPEX/Revenue decreased slightly on 1.2 pp from 4.4% in FY2013 to 3.2% in FY2016. It's average CAPEX/Revenue for the last three years was 2.9%.Battling declining revenue Stelux Holdings International Ltd made large investments to CAPEX (264% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-3.18%) and ROE (-14.20%). ROIC dropped on 13.2 pp from 10.0% to -3.2% in FY2016. ROE dropped on 20.5 pp from 6.3% to -14.2% in FY2016.
Leverage (Debt)
Debt level is 12.5x Net Debt / EBITDA and 26.9x Debt / EBITDA. Net Debt / EBITDA surged on 11.0x from 1.5x to 12.5x in FY2016. Debt jumped on 10.7% while cash jumped on 30.2%.
Appendix 1: Peers in Retail
Below you can find Stelux Holdings International 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% |
|---|
| Stelux Holdings International Ltd ($84) | | 9.5% | 6.7% | 1.3% | -13.7% |
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% |
|---|
| Stelux Holdings International Ltd ($84) | 61.7% | 62.7% | 61.1% | 61.3% | 59.7% |
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% | 6.8% |
|---|
| Stelux Holdings International Ltd ($84) | 11.9% | 11.2% | 10.1% | 9.1% | 1.2% |
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) | 4.0% | 3.6% | 3.8% | 3.5% | 1.7% |
|---|
| Stelux Holdings International Ltd ($84) | 4.6% | 4.4% | 3.0% | 2.4% | 3.2% |
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% | |
| Sa Sa International Holdings Ltd ($178) | 53.5% | 52.7% | 49.0% | 39.8% | 19.0% |
| Noble House China Holdings Ltd ($8246) | 17.7% | -67.7% | -113.8% | 35.6% | |
| |
|---|
| Median (117 companies) | 12.2% | 8.8% | 8.5% | 5.8% | 8.0% |
|---|
| Stelux Holdings International Ltd ($84) | 19.2% | 14.7% | 11.8% | 10.0% | -3.2% |
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 | -0.8x |
|---|
| Stelux Holdings International Ltd ($84) | 0.7x | 1.0x | 1.0x | 1.5x | 12.5x |
