Asia Coal Ltd CAPEX surged on 738% while Revenue dropped on 60.1%
27/06/2016 • About Asia Coal Ltd (
$835) • By InTwits
Asia Coal Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Asia Coal Ltd doesn't have a profitable business model yet: FY2016 ROIC is -301.7%
- The company operates at negative EBITDA Margin: -404.5%
- Asia Coal 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 -242.3%0
- Asia Coal Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 31.3%. At the same time it's in pair with industry average of 39.7%.
- CAPEX is quite volatile: 0.82 in FY2016, 0.098 in FY2015, 13.9 in FY2014, 2.3 in FY2013, 1.3 in FY2012
- The company has unprofitable business model: ROIC is at -301.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Asia Coal Ltd ($835) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 10.305 | 8.728 | 12.499 | 29.200 | 11.659 | -60.1% |
| Gross Profit | 5.839 | 5.460 | 9.591 | 1.702 | 0.623 | -63.4% |
| SG&A | | 37.822 | 57.987 | 32.040 | 50.680 | 58.2% |
| EBITDA | -34.403 | -28.512 | -37.710 | -27.636 | -47.164 | |
| Net Income | -306.945 | -52.779 | -144.094 | -25.144 | -50.338 | |
Balance Sheet
|
|---|
| Cash | 3.346 | 4.592 | 20.131 | 36.583 | 7.367 | -79.9% |
| Short Term Debt | 99.334 | 17.089 | 9.781 | 2.796 | 2.942 | 5.2% |
| Long Term Debt | 71.430 | 0.000 | 0.000 | 3.129 | 1.999 | -36.1% |
Cash flow
|
|---|
| Capex | 1.291 | 2.250 | 13.876 | 0.098 | 0.821 | 737.8% |
Ratios
|
|---|
| Revenue growth | 32.1% | -15.3% | 43.2% | 133.6% | -60.1% | |
| EBITDA growth | -79.4% | -17.1% | 32.3% | -26.7% | 70.7% | |
| Gross Margin | 56.7% | 62.6% | 76.7% | 5.8% | 5.3% | -0.5% |
| EBITDA Margin | -333.8% | -326.7% | -301.7% | -94.6% | -404.5% | -309.9% |
| Net Income Margin | -2,978.6% | -604.7% | -1,152.8% | -86.1% | -431.8% | -345.6% |
| SG&A, % of revenue | | 433.3% | 463.9% | 109.7% | 434.7% | 325.0% |
| CAPEX, % of revenue | 12.5% | 25.8% | 111.0% | 0.3% | 7.0% | 6.7% |
| ROIC | -15.7% | -28.8% | -70.3% | -152.8% | -301.7% | -148.9% |
Revenue and profitability
The company's Revenue dropped on 60.1%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 310 pp from -94.6% to -405% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue jumped on 325 pp from 110% to 435% in FY2016.
Net Income marign dropped on 346 pp from -86.1% to -432% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 7.0%. CAPEX/Revenue dropped on 18.7 pp from 25.8% in FY2013 to 7.0% in FY2016. Average CAPEX/Revenue for the last three years was 39.5%.
Leverage (Debt)
Debt level is -9.0x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt dropped on 16.6% while cash dropped on 79.9%.
Appendix 1: Peers in Coal
Below we provide Asia Coal Ltd benchmarking against other companies in Coal 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 |
|---|
| Sino Resources Group Ltd ($223) | | -44.8% | 14.7% | 354.5% | 0.4% |
| Dowell Property Holdings Ltd ($668) | -19.2% | -55.7% | -35.8% | 83.2% | |
| Capital Finance Holdings Ltd ($8239) | 83.6% | -5.2% | -5.5% | 70.6% | |
| Up Energy Development Group Ltd ($307) | | | | 60.5% | |
| Rosan Resources Holdings Ltd ($578) | -74.1% | 71.1% | 49.1% | 49.9% | |
| |
|---|
| Median (21 companies) | -9.0% | -7.8% | -14.2% | -22.9% | -25.7% |
|---|
| Asia Coal Ltd ($835) | | -15.3% | 43.2% | 133.6% | -60.1% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital Finance Holdings Ltd ($8239) | 6.4% | 7.2% | 8.7% | 98.2% | |
| Nan Nan Resources Enterprise Ltd ($1229) | 23.9% | 17.6% | 18.1% | 44.3% | 41.0% |
| Agritrade Resources Ltd ($1131) | 22.9% | 29.4% | 31.8% | 30.0% | |
| Shougang Fushan Resources Group Ltd ($639) | 63.5% | 50.9% | 40.1% | 24.5% | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 35.2% | 33.7% | 27.4% | 19.2% | |
| |
|---|
| Median (20 companies) | 19.8% | 15.6% | 8.7% | 2.9% | 24.0% |
|---|
| Asia Coal Ltd ($835) | 56.7% | 62.6% | 76.7% | 5.8% | 5.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital Finance Holdings Ltd ($8239) | -27.2% | -23.7% | -56.2% | 71.5% | |
| Nan Nan Resources Enterprise Ltd ($1229) | 19.1% | 14.1% | -0.2% | 40.5% | 24.1% |
| Agritrade Resources Ltd ($1131) | 41.6% | 37.3% | 33.4% | 31.1% | |
| Feishang Anthracite Resources Ltd ($1738) | -13.1% | -32.9% | 19.0% | 15.9% | |
| Kinetic Mines and Energy Ltd ($1277) | -277.0% | -51.9% | 29.3% | 15.8% | |
| |
|---|
| Median (21 companies) | 1.5% | -0.8% | -7.5% | -14.3% | 1.6% |
|---|
| Asia Coal Ltd ($835) | -333.8% | -326.7% | -301.7% | -94.6% | -404.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Siberian Mining Group Co Ltd ($1142) | 4.6% | 78.8% | 217.3% | 279.7% | |
| Feishang Anthracite Resources Ltd ($1738) | 244.9% | 159.7% | 80.9% | 90.2% | |
| Up Energy Development Group Ltd ($307) | | | 279.5% | 75.2% | |
| King Stone Energy Group Ltd ($663) | 58.5% | 135.3% | 205.7% | 69.3% | |
| SouthGobi Resources Ltd ($1878) | 124.8% | 20.2% | 11.5% | 52.6% | |
| |
|---|
| Median (20 companies) | 14.9% | 26.3% | 18.3% | 20.3% | 2.2% |
|---|
| Asia Coal Ltd ($835) | 12.5% | 25.8% | 111.0% | 0.3% | 7.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital Finance Holdings Ltd ($8239) | -25.1% | -14.9% | -26.9% | 21.0% | |
| Nan Nan Resources Enterprise Ltd ($1229) | 6.4% | 1.6% | -1.2% | 10.0% | 1.5% |
| Agritrade Resources Ltd ($1131) | 2.7% | 5.8% | 6.4% | 6.9% | |
| Kinetic Mines and Energy Ltd ($1277) | -6.6% | -5.7% | 8.5% | 3.2% | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 28.5% | 15.2% | 8.5% | 2.0% | |
| |
|---|
| Median (21 companies) | -2.0% | -0.4% | -3.5% | -3.9% | -8.5% |
|---|
| Asia Coal Ltd ($835) | -15.7% | -28.8% | -70.3% | -152.8% | -301.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Feishang Anthracite Resources Ltd ($1738) | | | 24.3x | 32.6x | |
| China Coal Energy Co Ltd ($1898) | 1.9x | 4.9x | 9.7x | 14.4x | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 0.4x | 1.7x | 3.5x | 9.8x | |
| Yanzhou Coal Mining Co Ltd ($1171) | 2.9x | 6.2x | 4.9x | 9.0x | |
| Kinetic Mines and Energy Ltd ($1277) | | | 4.5x | 5.9x | |
| |
|---|
| Median (8 companies) | 2.9x | 4.7x | 4.7x | 7.5x | -1.8x |
|---|
