China Smartpay Group Holdings Ltd reports 182% Net Income growth in 2016 and 16.5 pp EBITDA Margin growth from -16.5% to -0.052%
26/06/2016 • About China Smartpay Group Holdings Ltd (
$8325) • By InTwits
China Smartpay Group Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- China Smartpay Group Holdings Ltd doesn't have a profitable business model yet: FY2016 ROIC is -0.8%
- The company operates at negative EBITDA Margin: -0.1%
- China Smartpay Group Holdings Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 was 0.0%. On average EBITDA Margin was -3.8% for the sames years0
- China Smartpay Group Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.2%. At the same time it's a lot of higher than industry average of 57.3%.
- CAPEX is quite volatile: 10.1 in FY2016, 4.6 in FY2015, 1.1 in FY2014, 3.3 in FY2013, 0.73 in FY2012
- The company has unprofitable business model: ROIC is at -0.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
China Smartpay Group Holdings Ltd ($8325) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 22.6 | 84.6 | 148.5 | 333.4 | 598.3 | 79.5% |
| Gross Profit | 7.3 | 27.2 | 35.9 | 63.1 | 204.2 | 223.7% |
| SG&A | | 14.1 | 37.3 | 121.5 | 214.9 | 76.9% |
| EBITDA | -0.7 | 11.2 | -0.3 | -55.1 | -0.3 | |
| Net Income | -3.2 | -0.5 | -17.8 | -78.2 | 63.8 | |
Balance Sheet
|
|---|
| Cash | 16.9 | 23.0 | 47.1 | 37.6 | 230.5 | 513.4% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 88.5 | 20.2 | -77.2% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.7 | 3.3 | 1.1 | 4.6 | 10.1 | 120.4% |
Ratios
|
|---|
| Revenue growth | 60.0% | 274.7% | 75.6% | 124.5% | 79.5% | |
| EBITDA growth | -66.1% | -1,645.2% | -102.6% | 18,751.9% | -99.4% | |
| Gross Margin | 32.4% | 32.2% | 24.2% | 18.9% | 34.1% | 15.2% |
| EBITDA Margin | -3.2% | 13.3% | -0.2% | -16.5% | -0.1% | 16.5% |
| Net Income Margin | -14.3% | -0.6% | -12.0% | -23.5% | 10.7% | 34.1% |
| SG&A, % of revenue | | 16.7% | 25.1% | 36.4% | 35.9% | -0.5% |
| CAPEX, % of revenue | 3.2% | 4.0% | 0.7% | 1.4% | 1.7% | 0.3% |
| ROIC | -5.5% | 53.7% | -1.7% | -14.0% | -0.8% | 13.2% |
| ROE | -19.3% | -3.2% | -23.6% | -22.5% | 6.6% | 29.1% |
| Net Debt/EBITDA | | -2.1x | | | | 0.0x |
Revenue and profitability
China Smartpay Group Holdings Ltd's Revenue jumped on 79.5%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 81.5 pp from 15.8% to 97.2% in FY2016.
Gross Margin jumped on 15.2 pp from 18.9% to 34.1% in FY2016. SG&A as a % of Revenue decreased slightly on 0.52 pp from 36.4% to 35.9% in FY2016.
Net Income marign jumped on 34.1 pp from -23.5% to 10.7% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 China Smartpay Group Holdings Ltd had CAPEX/Revenue of 1.7%. The company showed decline in CAPEX/Revenue of 2.3 pp from 4.0% in FY2013 to 1.7% in FY2016. Average CAPEX/Revenue for the last three years was 1.3%.
Return on investment
The company operates at negative ROIC (-0.84%) and low but positive ROE (6.61%). ROIC surged on 13.2 pp from -14.0% to -0.84% in FY2016. ROE jumped on 29.1 pp from -22.5% to 6.6% in FY2016.
Leverage (Debt)
Debt level is -7.4x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt dropped on 77.2% while cash surged on 513%.
Appendix 1: Peers in Commercial Services
Below we provide China Smartpay Group Holdings Ltd benchmarking against other companies in Commercial Services 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 |
|---|
| Kai Yuan Holdings Ltd ($1215) | 99.1% | 14.9% | -88.3% | 271.8% | |
| China Seven Star Holdings Ltd ($245) | 6.7% | -81.8% | -39.3% | 195.3% | |
| Celebrate International Holdings Ltd ($8212) | -90.1% | 1,437.6% | -6.3% | 117.0% | |
| Haier Healthwise Holdings Ltd ($348) | -22.0% | -50.1% | -7.5% | 101.1% | |
| CAR Inc ($699) | 96.4% | 68.0% | 30.3% | 42.1% | |
| |
|---|
| Median (65 companies) | 6.7% | 8.6% | 9.8% | 4.0% | -0.9% |
|---|
| China Smartpay Group Holdings Ltd ($8325) | | 274.7% | 75.6% | 124.5% | 79.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| HC International Inc ($2280) | 87.5% | 91.9% | 92.5% | 89.6% | |
| Winto Group Holdings Ltd ($8238) | 90.2% | 93.4% | 92.0% | 88.4% | |
| Dingyi Group Investment Ltd ($508) | 75.8% | | 64.5% | 86.0% | |
| Fu Shou Yuan International Group Ltd ($1448) | 80.5% | 80.4% | 80.0% | 77.6% | |
| Nirvana Asia Ltd ($1438) | 68.3% | 69.6% | 70.5% | 75.7% | |
| |
|---|
| Median (60 companies) | 31.6% | 30.7% | 31.8% | 31.9% | 29.3% |
|---|
| China Smartpay Group Holdings Ltd ($8325) | 32.4% | 32.2% | 24.2% | 18.9% | 34.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Zuoli Kechuang Micro-Finance Co Ltd ($6866) | 61.6% | 84.9% | 75.9% | 80.9% | |
| Shenzhen International Holdings Ltd ($152) | 60.2% | 65.8% | 97.1% | 73.6% | |
| Yuexiu Transport Infrastructure Ltd ($1052) | 78.3% | 74.5% | 74.0% | 71.6% | |
| CAR Inc ($699) | 43.6% | 30.1% | 43.1% | 67.4% | |
| Jiangsu Expressway Co Ltd ($177) | 57.0% | 60.7% | 59.3% | 61.5% | |
| |
|---|
| Median (65 companies) | 17.6% | 16.0% | 12.9% | 10.1% | -16.6% |
|---|
| China Smartpay Group Holdings Ltd ($8325) | -3.2% | 13.3% | -0.2% | -16.5% | -0.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Blue Sky Power Holdings Ltd ($6828) | 21.3% | 9.0% | 13.9% | 47.4% | |
| COSCO Pacific Ltd ($1199) | 96.6% | 66.6% | 43.3% | 45.8% | |
| Shenzhen International Holdings Ltd ($152) | 23.0% | 22.1% | 20.9% | 35.0% | |
| Celebrate International Holdings Ltd ($8212) | 211.7% | 12.0% | 6.2% | 34.2% | |
| China Maple Leaf Educational Systems Ltd ($1317) | 25.7% | 50.9% | 21.1% | 32.8% | |
| |
|---|
| Median (65 companies) | 3.0% | 3.8% | 3.2% | 3.9% | 1.1% |
|---|
| China Smartpay Group Holdings Ltd ($8325) | 3.2% | 4.0% | 0.7% | 1.4% | 1.7% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Wonderful Sky Financial Group Holdings Ltd ($1260) | 51.5% | 26.6% | 30.0% | 29.5% | |
| 1010 Printing Group Ltd ($1127) | 13.5% | 20.8% | 17.8% | 19.9% | |
| China Packaging Holdings Development Ltd ($1439) | 52.0% | 46.6% | 34.1% | 19.8% | |
| iOne Holdings Ltd ($982) | 12.5% | 11.1% | 9.4% | 19.2% | |
| CAR Inc ($699) | 5.2% | 2.7% | 12.2% | 19.0% | |
| |
|---|
| Median (65 companies) | 7.5% | 5.8% | 5.8% | 3.3% | -11.4% |
|---|
| China Smartpay Group Holdings Ltd ($8325) | -5.5% | 53.7% | -1.7% | -14.0% | -0.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Celebrate International Holdings Ltd ($8212) | | | | 22.2x | |
| Kai Yuan Holdings Ltd ($1215) | -143.8x | -0.7x | | 18.8x | |
| Eagle Legend Asia Ltd ($936) | 4.0x | 4.0x | 3.3x | 6.2x | |
| Sichuan Expressway Co Ltd ($107) | 2.7x | 3.8x | 4.3x | 5.5x | |
| Yuexiu Transport Infrastructure Ltd ($1052) | 4.5x | 3.1x | 2.7x | 5.3x | |
| |
|---|
| Median (43 companies) | -0.0x | -0.7x | -0.5x | -0.6x | -2.4x |
|---|
