Oriental Press Group reports 41.1% EBITDA decline in 2016 and 4.7 pp EBITDA Margin decline from 13.9% to 9.2%
24/06/2016 • About Oriental Press Group (
$18) • By InTwits
Oriental Press Group reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Oriental Press Group is a company in decline: FY2016 revenue growth was -10.8%, 5 years revenue CAGR was -5.8%
- Oriental Press Group has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.4%. At the same time it's a lot of higher than industry average of 12.6%.
- CAPEX is quite volatile: 12.3 in FY2016, 30.0 in FY2015, 27.9 in FY2014, 81.3 in FY2013, 17.3 in FY2012
- The company has potentially unprofitable business model: ROIC is at 1.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Oriental Press Group ($18) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,505 | 1,457 | 1,436 | 1,325 | 1,181 | -10.8% |
| EBITDA | 143 | 187 | 210 | 184 | 109 | -41.1% |
| Net Income | 119 | 183 | 90 | 61 | 55 | -10.2% |
Balance Sheet
|
|---|
| Cash | 1,630 | 1,602 | 1,742 | 1,653 | 1,736 | 5.0% |
| Short Term Debt | 10 | 9 | 9 | 8 | 8 | -1.9% |
| Long Term Debt | 1 | 2 | 4 | 6 | 4 | -34.4% |
Cash flow
|
|---|
| Capex | 17 | 81 | 28 | 30 | 12 | -59.0% |
Ratios
|
|---|
| Revenue growth | -5.3% | -3.2% | -1.4% | -7.8% | -10.8% | |
| EBITDA growth | -56.2% | 30.3% | 12.6% | -12.3% | -41.1% | |
| EBITDA Margin | 9.5% | 12.8% | 14.6% | 13.9% | 9.2% | -4.7% |
| Net Income Margin | 7.9% | 12.5% | 6.3% | 4.6% | 4.6% | 0.0% |
| CAPEX, % of revenue | 1.2% | 5.6% | 1.9% | 2.3% | 1.0% | -1.2% |
| ROIC | 2.5% | 4.0% | 4.5% | 4.0% | 1.4% | -2.5% |
| ROE | 3.9% | 6.3% | 3.1% | 2.2% | 2.1% | -0.1% |
| Net Debt/EBITDA | -11.3x | -8.5x | -8.2x | -8.9x | -15.9x | -7.0x |
Revenue and profitability
Oriental Press Group's Revenue dropped on 10.8%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 4.7 pp from 13.9% to 9.2% in FY2016.
Net Income marign showed almost no change in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 1.0%. CAPEX/Revenue decreased on 4.5 pp from 5.6% in FY2013 to 1.0% in FY2016. Average CAPEX/Revenue for the last three years was 1.8%.
Return on investment
The company operates at low ROIC (1.44%) and ROE (2.06%). ROIC decreased on 2.5 pp from 4.0% to 1.4% in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Debt level is -15.9x Net Debt / EBITDA and 0.1x Debt / EBITDA. Net Debt / EBITDA dropped on 7.0x from -8.9x to -15.9x in FY2016. Debt dropped on 15.6% while cash increased on 5.0%.
Appendix 1: Peers in Media
Below you can find Oriental Press Group benchmarking vs. other companies in Media 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 |
|---|
| CMMB Vision Holdings Ltd ($471) | | 168.1% | 27.8% | 850.0% | |
| SCMP Group Ltd ($583) | 7.8% | 12.5% | -95.9% | 12.5% | |
| Hong Kong Economic Times Holdings Ltd ($423) | | 2.7% | 3.1% | 5.3% | 4.9% |
| Modern Media Holdings ($72) | 11.8% | -3.7% | -4.3% | -1.3% | |
| Focus Media Network Ltd ($8112) | -10.6% | 34.6% | 5.6% | -5.2% | |
| |
|---|
| Median (18 companies) | 4.5% | -1.8% | -4.3% | -9.2% | -6.9% |
|---|
| Oriental Press Group ($18) | | -3.2% | -1.4% | -7.8% | -10.8% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| I-CABLE Communications Ltd ($1097) | 94.8% | 94.7% | 94.1% | 94.4% | |
| Focus Media Network Ltd ($8112) | 68.0% | 67.2% | 50.8% | 57.6% | |
| Television Broadcasts Ltd ($511) | 62.9% | 60.9% | 59.0% | 54.9% | |
| One Media Group Ltd ($426) | 57.3% | 56.7% | 54.5% | 52.7% | |
| Modern Media Holdings ($72) | 57.5% | 55.8% | 55.6% | 50.8% | |
| |
|---|
| Median (16 companies) | 38.5% | 39.5% | 36.1% | 36.5% | 38.2% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SCMP Group Ltd ($583) | 23.5% | 20.5% | 218.1% | 193.5% | |
| Media Chinese International Ltd ($685) | 20.0% | 18.3% | 18.1% | 16.5% | 14.3% |
| One Media Group Ltd ($426) | 18.7% | 23.0% | 22.8% | 15.2% | |
| Phoenix Satellite Television Holdings Ltd ($2008) | 30.1% | 31.1% | 24.6% | 14.1% | |
| Next Media Ltd ($282) | 20.2% | 18.8% | 13.9% | 12.0% | 3.5% |
| |
|---|
| Median (18 companies) | 12.9% | 11.5% | 9.8% | 8.9% | 7.1% |
|---|
| Oriental Press Group ($18) | 9.5% | 12.8% | 14.6% | 13.9% | 9.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SCMP Group Ltd ($583) | 7.0% | 5.3% | 52.2% | 85.2% | |
| Evergrande Health Industry Group Ltd ($708) | 14.6% | 2.4% | 2.9% | 13.5% | |
| I-CABLE Communications Ltd ($1097) | 10.1% | 7.6% | 11.3% | 13.0% | |
| Hong Kong Economic Times Holdings Ltd ($423) | 8.4% | 8.5% | 1.3% | 10.0% | 1.5% |
| Tom Group Ltd ($2383) | 11.9% | 8.4% | 9.4% | 9.5% | |
| |
|---|
| Median (18 companies) | 3.9% | 5.2% | 2.9% | 6.5% | 1.6% |
|---|
| Oriental Press Group ($18) | 1.2% | 5.6% | 1.9% | 2.3% | 1.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Media Chinese International Ltd ($685) | 18.6% | 17.8% | 18.4% | 15.6% | 11.1% |
| One Media Group Ltd ($426) | 25.6% | 21.8% | 16.0% | 8.9% | |
| Next Media Ltd ($282) | 8.5% | 6.7% | 8.2% | 6.8% | -1.5% |
| Modern Media Holdings ($72) | 20.6% | 10.4% | 9.3% | 5.5% | |
| Hong Kong Economic Times Holdings Ltd ($423) | 11.5% | -1.5% | 3.2% | 5.2% | 7.0% |
| |
|---|
| Median (18 companies) | 5.6% | 5.1% | 2.6% | 0.3% | 2.7% |
|---|
| Oriental Press Group ($18) | 2.5% | 4.0% | 4.5% | 4.0% | 1.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Tom Group Ltd ($2383) | | | 8.1x | 16.7x | |
| I-CABLE Communications Ltd ($1097) | -4.0x | -0.8x | 0.2x | 2.0x | |
| One Media Group Ltd ($426) | -2.3x | -0.6x | -1.1x | 1.5x | |
| Modern Media Holdings ($72) | -0.8x | -0.9x | 0.1x | 1.0x | |
| Media Chinese International Ltd ($685) | -1.4x | 0.8x | 0.6x | 0.2x | -0.5x |
| |
|---|
| Median (11 companies) | -1.4x | -1.1x | -1.1x | -0.1x | -0.7x |
|---|
| Oriental Press Group ($18) | -11.3x | -8.5x | -8.2x | -8.9x | -15.9x |
