Eagle Nice International Holdings Ltd reports 19.0% Net Income growth in 2016 and 1.3 pp EBITDA Margin growth from 13.2% to 14.4%
24/06/2016 • About Eagle Nice International Holdings Ltd (
$2368) • By InTwits
Eagle Nice International Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Eagle Nice International Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.4%. At the same time it's a lot of higher than industry average of 4.2%.
- CAPEX is quite volatile: 24.8 in FY2016, 18.9 in FY2015, 20.5 in FY2014, 79.6 in FY2013, 247 in FY2012
- The company has highly profitable business model: ROIC is at 12.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Eagle Nice International Holdings Ltd ($2368) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,446 | 1,444 | 1,484 | 1,517 | 1,535 | 1.2% |
| Gross Profit | 297 | 250 | 195 | 266 | 307 | 15.4% |
| SG&A | | 153 | 157 | 138 | 148 | 6.7% |
| EBITDA | 193 | 162 | 112 | 200 | 222 | 10.9% |
| Net Income | 120 | 73 | 22 | 105 | 125 | 19.0% |
Balance Sheet
|
|---|
| Cash | 342 | 309 | 277 | 255 | 255 | 0.0% |
| Short Term Debt | 419 | 388 | 340 | 238 | 198 | -16.7% |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 247 | 80 | 21 | 19 | 25 | 30.8% |
Ratios
|
|---|
| Revenue growth | 24.1% | -0.1% | 2.8% | 2.2% | 1.2% | |
| EBITDA growth | 5.6% | -16.0% | -31.1% | 78.8% | 10.9% | |
| Gross Margin | 20.5% | 17.3% | 13.1% | 17.5% | 20.0% | 2.5% |
| EBITDA Margin | 13.4% | 11.2% | 7.5% | 13.2% | 14.4% | 1.3% |
| Net Income Margin | 8.3% | 5.1% | 1.5% | 6.9% | 8.2% | 1.2% |
| SG&A, % of revenue | | 10.6% | 10.6% | 9.1% | 9.6% | 0.5% |
| CAPEX, % of revenue | 17.1% | 5.5% | 1.4% | 1.2% | 1.6% | 0.4% |
| ROIC | 11.7% | 6.7% | 3.4% | 10.0% | 12.4% | 2.4% |
| ROE | 11.9% | 7.0% | 2.2% | 10.0% | 11.4% | 1.4% |
| Net Debt/EBITDA | 0.4x | 0.5x | 0.6x | -0.1x | -0.3x | -0.2x |
Revenue and profitability
The company's Revenue increased slightly on 1.2%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.8 pp from 10.7% to 8.9% in FY2016.
Gross Margin increased on 2.5 pp from 17.5% to 20.0% in FY2016. SG&A as a % of Revenue increased slightly on 0.50 pp from 9.1% to 9.6% in FY2016.
Net Income marign increased slightly on 1.2 pp from 6.9% to 8.2% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 1.6%. CAPEX/Revenue decreased on 3.9 pp from 5.5% in FY2013 to 1.6% in FY2016. It's average CAPEX/Revenue for the last three years was 1.4%.
Return on investment
The company operates at good ROIC (12.37%) while ROE is low (11.44%). ROIC increased on 2.4 pp from 10.0% to 12.4% in FY2016. ROE increased slightly on 1.4 pp from 10.0% to 11.4% in FY2016.
Leverage (Debt)
Debt level is -0.3x Net Debt / EBITDA and 0.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from -0.1x to -0.3x in FY2016. Debt dropped on 16.7% while cash showed almost no change in FY2016.
Appendix 1: Peers in Apparel
Below we provide Eagle Nice International Holdings Ltd benchmarking against other companies in Apparel 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 |
|---|
| Symphony Holdings Ltd/Hong Kong ($1223) | -94.0% | 46.8% | 20.4% | 33.1% | |
| Highlight China IoT International Ltd ($1682) | 0.8% | 17.7% | -73.7% | 29.6% | |
| Koradior Holdings Ltd ($3709) | 48.3% | 44.7% | 47.7% | 23.9% | |
| Kingmaker Footwear Holdings Ltd ($1170) | 10.0% | 9.3% | 6.3% | 23.7% | |
| Cosmo Lady China Holdings Co Ltd ($2298) | 36.3% | 29.2% | 37.4% | 23.6% | |
| |
|---|
| Median (51 companies) | 5.3% | 6.3% | 5.5% | -2.1% | -0.1% |
|---|
| Eagle Nice International Holdings Ltd ($2368) | | -0.1% | 2.8% | 2.2% | 1.2% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Symphony Holdings Ltd/Hong Kong ($1223) | 38.5% | 42.3% | 59.6% | 75.6% | |
| Koradior Holdings Ltd ($3709) | 62.8% | 69.3% | 73.3% | 73.7% | |
| Prada SpA ($1913) | 71.5% | 72.1% | 73.8% | 71.8% | 72.4% |
| China Outfitters Holdings Ltd ($1146) | 74.9% | 74.3% | 70.0% | 65.7% | |
| Crocodile Garments ($122) | 64.7% | 60.7% | 60.4% | 62.1% | |
| |
|---|
| Median (50 companies) | 25.0% | 24.3% | 26.0% | 25.0% | 72.4% |
|---|
| Eagle Nice International Holdings Ltd ($2368) | 20.5% | 17.3% | 13.1% | 17.5% | 20.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Lilang Ltd ($1234) | 26.3% | 26.9% | 29.4% | 30.6% | |
| Cabbeen Fashion Ltd ($2030) | 25.0% | 29.7% | 28.4% | 29.0% | |
| Fuguiniao Co Ltd ($1819) | 24.5% | 26.1% | 26.7% | 27.9% | |
| Prada SpA ($1913) | 29.6% | 31.7% | 31.7% | 26.8% | 22.4% |
| Shenzhou International Group Holdings Ltd ($2313) | 26.4% | 26.2% | 26.1% | 26.7% | |
| |
|---|
| Median (51 companies) | 10.5% | 10.2% | 7.2% | 6.4% | -2.7% |
|---|
| Eagle Nice International Holdings Ltd ($2368) | 13.4% | 11.2% | 7.5% | 13.2% | 14.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Symphony Holdings Ltd/Hong Kong ($1223) | 136.9% | 70.3% | 13.5% | 28.5% | |
| Shenzhou International Group Holdings Ltd ($2313) | 7.3% | 7.9% | 10.2% | 16.1% | |
| Crocodile Garments ($122) | 20.1% | 22.1% | 1.8% | 13.5% | |
| Texhong Textile Group Ltd ($2678) | 8.9% | 11.8% | 5.8% | 10.5% | |
| Prada SpA ($1913) | 9.7% | 10.6% | 15.3% | 10.2% | 11.1% |
| |
|---|
| Median (50 companies) | 2.2% | 3.0% | 2.5% | 2.4% | 6.3% |
|---|
| Eagle Nice International Holdings Ltd ($2368) | 17.1% | 5.5% | 1.4% | 1.2% | 1.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Koradior Holdings Ltd ($3709) | 45.2% | 69.5% | 36.5% | 31.0% | |
| Cosmo Lady China Holdings Co Ltd ($2298) | 41.7% | 56.0% | 38.6% | 27.8% | |
| Cabbeen Fashion Ltd ($2030) | 32.3% | 32.9% | 26.5% | 27.0% | |
| Sitoy Group Holdings Ltd ($1023) | 39.3% | 28.7% | 31.8% | 22.0% | |
| Prada SpA ($1913) | 32.1% | 37.4% | 34.0% | 21.9% | 14.0% |
| |
|---|
| Median (51 companies) | 11.3% | 7.3% | 5.3% | 4.5% | -4.6% |
|---|
| Eagle Nice International Holdings Ltd ($2368) | 11.7% | 6.7% | 3.4% | 10.0% | 12.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| S Culture International Holdings Ltd ($1255) | 1.4x | 0.7x | 2.4x | 158.1x | |
| High Fashion International Ltd ($608) | 16.7x | 27.7x | 11.2x | 5.2x | |
| Global Brands Group Holding Ltd ($787) | -0.4x | -0.3x | 1.3x | 2.1x | |
| Fuguiniao Co Ltd ($1819) | -0.0x | -0.7x | 0.3x | 1.9x | |
| Texhong Textile Group Ltd ($2678) | 1.4x | 1.3x | 2.3x | 1.4x | |
| |
|---|
| Median (37 companies) | -0.3x | -0.7x | -0.4x | -1.2x | 0.1x |
|---|
| Eagle Nice International Holdings Ltd ($2368) | 0.4x | 0.5x | 0.6x | -0.1x | -0.3x |
