Zhidao International Holdings Ltd revenue decline accelerated to 32.7% in FY2016 vs. 30.6% a year earliner
24/06/2016 • About Zhidao International Holdings Ltd (
$1220) • By InTwits
Zhidao International Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Zhidao International Holdings Ltd is a company in decline: FY2016 revenue growth was -32.7%, 5 years revenue CAGR was -31.0%
- The company operates at negative EBITDA Margin: -112.9%
- Zhidao International Holdings Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 is 0.0%. Average EBITDA Margin for the same period was -6.1%0
- Zhidao International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.0%.
- The company has unprofitable business model: ROIC is at -24.5%
- It operates with high leverage: Net Debt/EBITDA is 11.9x while industry average is 1.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Zhidao International Holdings Ltd ($1220) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 343.2 | 202.8 | 139.1 | 96.5 | 65.0 | -32.7% |
| Gross Profit | 25.8 | 25.9 | 10.7 | 10.7 | 7.7 | -27.8% |
| SG&A | | 11.4 | 9.9 | 9.8 | 10.8 | 9.9% |
| EBITDA | 17.5 | 14.8 | -5.0 | -5.2 | -73.4 | |
| Net Income | 1,921.7 | 13.7 | -6.5 | -6.8 | -73.7 | |
Balance Sheet
|
|---|
| Cash | 75.5 | 38.0 | 37.9 | 43.4 | 259.4 | 498.1% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.0 | 0.1 | 0.0 | 0.0 | 0.1 | |
Ratios
|
|---|
| Revenue growth | -17.3% | -40.9% | -31.4% | -30.6% | -32.7% | |
| EBITDA growth | 30.4% | -15.5% | -133.9% | 3.8% | 1,315.0% | |
| Gross Margin | 7.5% | 12.8% | 7.7% | 11.1% | 11.9% | 0.8% |
| EBITDA Margin | 5.1% | 7.3% | -3.6% | -5.4% | -112.9% | -107.6% |
| Net Income Margin | 560.0% | 6.8% | -4.7% | -7.0% | -113.3% | -106.3% |
| SG&A, % of revenue | | 5.6% | 7.1% | 10.2% | 16.6% | 6.4% |
| CAPEX, % of revenue | 0.0% | 0.0% | 0.0% | 0.0% | 0.1% | 0.1% |
| ROIC | | 9.4% | -3.2% | -3.6% | -24.5% | -21.0% |
| ROE | | 9.4% | -4.5% | -4.9% | -24.6% | -19.8% |
| Net Debt/EBITDA | -4.3x | -2.6x | | | | 0.0x |
Revenue and profitability
The company's Revenue dropped on 32.7%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin dropped on 108 pp from -5.4% to -113% in FY2016.
Gross Margin increased slightly on 0.80 pp from 11.1% to 11.9% in FY2016. SG&A as a % of Revenue increased on 6.4 pp from 10.2% to 16.6% in FY2016.
Net Income marign dropped on 106 pp from -7.0% to -113% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Zhidao International Holdings Ltd's CAPEX/Revenue was 0.14% in FY2016. Zhidao International Holdings Ltd showed almost no change in CAPEX/Revenue from FY2013 to FY2016.
Return on investment
The company operates at negative ROIC (-24.55%) and ROE (-24.63%). ROIC dropped on 21.0 pp from -3.6% to -24.5% in FY2016. ROE dropped on 19.8 pp from -4.9% to -24.6% in FY2016.
Leverage (Debt)
The company has no debt. Cash jumped on 498%.
Appendix 1: Peers in Mining
Below you can find Zhidao International Holdings Ltd benchmarking vs. other companies in Mining 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 |
|---|
| Mongolia Energy Corp Ltd ($276) | | 89.7% | -95.8% | 2,361.6% | |
| Real Gold Mining Ltd ($246) | -44.0% | -68.0% | -26.2% | 106.2% | |
| REX Global Entertainment Holdings Ltd ($164) | | 81.6% | -15.5% | 96.4% | 30.4% |
| Hengxing Gold Holding Co Ltd ($2303) | | | 3,467.3% | 78.0% | |
| Zijin Mining Group Co Ltd ($2899) | 21.6% | 2.5% | 18.1% | 26.9% | |
| |
|---|
| Median (47 companies) | 5.9% | 0.6% | -5.1% | -14.0% | 8.9% |
|---|
| Zhidao International Holdings Ltd ($1220) | | -40.9% | -31.4% | -30.6% | -32.7% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sino Prosper Group Holdings Ltd ($766) | 2.5% | 5.1% | 39.6% | 93.0% | |
| REX Global Entertainment Holdings Ltd ($164) | -15.8% | -7.8% | -0.8% | 88.6% | 87.3% |
| China Billion Resources Ltd ($274) | 71.4% | 47.2% | 73.4% | 79.7% | |
| Sun International Resources Ltd ($8029) | 83.2% | 73.1% | 64.8% | 69.4% | 58.8% |
| Timeless Software Ltd ($8028) | 17.7% | 48.5% | 29.4% | 42.1% | 39.9% |
| |
|---|
| Median (48 companies) | 15.8% | 14.4% | 15.5% | 15.5% | 58.8% |
|---|
| Zhidao International Holdings Ltd ($1220) | 7.5% | 12.8% | 7.7% | 11.1% | 11.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| G-Resources Group Ltd ($1051) | | 54.5% | 53.4% | 58.3% | |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 70.0% | 64.6% | 59.6% | 51.3% | |
| Timeless Software Ltd ($8028) | -113.1% | 24.7% | -13.7% | 46.1% | 28.0% |
| Hengxing Gold Holding Co Ltd ($2303) | | -766.2% | 24.5% | 43.9% | |
| Sino Prosper Group Holdings Ltd ($766) | -138.6% | -138.2% | -378.4% | 42.9% | |
| |
|---|
| Median (48 companies) | 5.1% | 8.5% | 6.3% | 5.1% | -37.0% |
|---|
| Zhidao International Holdings Ltd ($1220) | 5.1% | 7.3% | -3.6% | -5.4% | -112.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mongolia Energy Corp Ltd ($276) | 8,006.5% | 1,061.7% | 30,555.4% | 1,973.0% | |
| Kaz Minerals ($847) | 36.6% | 136.5% | 168.8% | 168.7% | |
| Chinalco Mining Corp International ($3668) | | | | 115.6% | |
| China Dynamics Holdings Ltd ($476) | 1.8% | 0.0% | 1.0% | 113.8% | |
| MMG Ltd ($1208) | 25.7% | 22.6% | 41.9% | 100.4% | |
| |
|---|
| Median (48 companies) | 17.7% | 17.9% | 16.5% | 12.5% | 4.1% |
|---|
| Zhidao International Holdings Ltd ($1220) | 0.0% | 0.0% | 0.0% | 0.0% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CGN Mining Co Ltd ($1164) | 2.6% | 3.3% | 7.9% | 16.7% | |
| United Co RUSAL PLC ($486) | 0.3% | -9.0% | 6.3% | 12.3% | |
| Xingfa Aluminium Holdings Ltd ($98) | 7.6% | 8.8% | 11.7% | 11.8% | |
| Timeless Software Ltd ($8028) | -29.1% | 7.3% | -4.6% | 11.6% | 3.9% |
| China Hongqiao Group Ltd ($1378) | 24.8% | 17.0% | 14.1% | 10.6% | |
| |
|---|
| Median (49 companies) | 1.5% | 2.3% | 1.5% | -1.0% | -10.0% |
|---|
| Zhidao International Holdings Ltd ($1220) | | 9.4% | -3.2% | -3.6% | -24.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Daye Non-Ferrous Metals Mining Ltd ($661) | 9.2x | 9.7x | 9.2x | 31.5x | |
| Chinalco Mining Corp International ($3668) | | | | 25.0x | |
| MMG Ltd ($1208) | 2.1x | 2.0x | 10.2x | 20.2x | |
| Kaz Minerals ($847) | 2.4x | 2.9x | 5.5x | 18.7x | |
| China Precious Metal Resources Holdings Co Ltd ($1194) | 1.5x | 4.1x | 6.4x | 13.5x | |
| |
|---|
| Median (29 companies) | 2.0x | 1.9x | 4.5x | 3.4x | -1.4x |
|---|
