Associated International Hotels Ltd reports 32.5% Net Income decline in 2016 and almost no change in EBITDA Margin of 83.4%
27/06/2016 • About Associated International Hotels Ltd (
$105) • By InTwits
Associated International Hotels Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Associated International Hotels Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.6%. At the same time it's in pair with industry average of 20.9%.
- CAPEX is quite volatile: 3.7 in FY2016, 51.4 in FY2015, 6.2 in FY2014, 14.1 in FY2013, 48.4 in FY2012
- The company has potentially unprofitable business model: ROIC is at 3.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Associated International Hotels Ltd ($105) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 455.3 | 518.9 | 606.3 | 645.0 | 667.2 | 3.4% |
| Gross Profit | 392.0 | 451.1 | 538.9 | 564.5 | 586.2 | 3.8% |
| SG&A | | | 40.0 | 39.5 | 38.1 | -3.4% |
| EBITDA | 363.9 | 460.8 | 510.3 | 538.8 | 556.6 | 3.3% |
| Net Income | 429.7 | 2,733.6 | 1,382.3 | 1,290.4 | 871.4 | -32.5% |
Balance Sheet
|
|---|
| Cash | 114.8 | 139.4 | 209.9 | 300.6 | 338.3 | 12.5% |
| Short Term Debt | 0.0 | 200.0 | 0.0 | 0.0 | 200.1 | 689,851.7% |
| Long Term Debt | 202.3 | 2.2 | 202.1 | 202.1 | 2.1 | -99.0% |
Cash flow
|
|---|
| Capex | 48.4 | 14.1 | 6.2 | 51.4 | 3.7 | -92.8% |
Ratios
|
|---|
| Revenue growth | 21.0% | 14.0% | 16.8% | 6.4% | 3.4% | |
| EBITDA growth | 34.1% | 26.6% | 10.7% | 5.6% | 3.3% | |
| Gross Margin | 86.1% | 86.9% | 88.9% | 87.5% | 87.9% | 0.3% |
| EBITDA Margin | 79.9% | 88.8% | 84.2% | 83.5% | 83.4% | -0.1% |
| Net Income Margin | 94.4% | 526.8% | 228.0% | 200.1% | 130.6% | -69.5% |
| SG&A, % of revenue | | | 6.6% | 6.1% | 5.7% | -0.4% |
| CAPEX, % of revenue | 10.6% | 2.7% | 1.0% | 8.0% | 0.6% | -7.4% |
| ROIC | 3.3% | 3.9% | 3.8% | 3.7% | 3.7% | -0.0% |
| ROE | 4.3% | 24.2% | 10.7% | 9.3% | 6.0% | -3.3% |
| Net Debt/EBITDA | 0.2x | 0.1x | -0.0x | -0.2x | -0.2x | -0.1x |
Revenue and profitability
The company's Revenue increased on 3.4%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.4 pp from -6.0% to -3.5% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign dropped on 69.5 pp from 200% to 131% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Associated International Hotels Ltd's CAPEX/Revenue was 0.55% in FY2016. CAPEX/Revenue decreased on 2.2 pp from 2.7% in FY2013 to 0.55% in FY2016. It's average level of CAPEX/Revenue for the last three years was 3.2%.
Return on investment
The company operates at low ROIC (3.71%) and ROE (6.00%). ROIC showed almost no change in FY2016. ROE decreased on 3.3 pp from 9.3% to 6.0% in FY2016.
Leverage (Debt)
Debt level is -0.2x Net Debt / EBITDA and 0.4x Debt / EBITDA. Net Debt / EBITDA decreased on 0.1x from -0.2x to -0.2x in FY2016. Debt showed almost no change in FY2016 while cash jumped on 12.5%.
Appendix 1: Peers in Real Estate
Below we provide Associated International Hotels Ltd benchmarking against other companies in Real Estate 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 |
|---|
| Guangdong Land Holdings Ltd ($124) | | | | 24,971.2% | |
| GR Properties Ltd ($108) | 21.6% | -82.9% | 14.6% | 1,203.6% | |
| Wanda Hotel Development Co Ltd ($169) | | -51.4% | -86.2% | 1,071.2% | |
| Henderson Investment Ltd ($97) | -78.9% | | | 737.1% | |
| ITC Properties Group Ltd ($199) | | -95.2% | 75.7% | 678.6% | 206.4% |
| |
|---|
| Median (179 companies) | 15.9% | 13.1% | 5.2% | 4.2% | 5.4% |
|---|
| Associated International Hotels Ltd ($105) | | 14.0% | 16.8% | 6.4% | 3.4% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renhe Commercial Holdings Co Ltd ($1387) | 79.0% | 95.2% | 97.9% | 99.9% | |
| Tern Properties Co Ltd ($277) | 96.7% | 98.4% | 98.4% | 98.7% | 98.8% |
| YT Realty Group Ltd ($75) | 94.4% | 96.6% | 96.7% | 97.6% | |
| Wah Ha Realty Co Ltd ($278) | 96.3% | 96.0% | 93.2% | 95.9% | |
| Soundwill Holdings Ltd ($878) | 53.1% | 74.5% | 46.9% | 95.7% | |
| |
|---|
| Median (160 companies) | 41.9% | 41.8% | 39.1% | 38.2% | 48.2% |
|---|
| Associated International Hotels Ltd ($105) | 86.1% | 86.9% | 88.9% | 87.5% | 87.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Chinese Estates Holdings Ltd ($127) | 356.2% | 91.6% | 195.5% | 397.4% | |
| Zall Development Group Ltd ($2098) | 105.3% | 133.1% | 143.2% | 213.9% | |
| SOHO China Ltd ($410) | 113.6% | 80.8% | 104.0% | 201.9% | |
| Beijing Properties Holdings Ltd ($925) | -606.3% | 2,162.6% | 224.3% | 186.5% | |
| Swire Properties Ltd ($1972) | 154.5% | 114.6% | 73.2% | 100.3% | |
| |
|---|
| Median (179 companies) | 28.9% | 28.3% | 26.9% | 23.4% | 13.3% |
|---|
| Associated International Hotels Ltd ($105) | 79.9% | 88.8% | 84.2% | 83.5% | 83.4% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| LT Commercial Real Estate Ltd ($112) | 0.0% | 18.0% | 27,965.5% | 4,834.8% | |
| China Oceanwide Holdings Ltd ($715) | 0.8% | 0.3% | 2.0% | 880.6% | |
| Madex International Holdings Ltd ($231) | 174.5% | 519.7% | 205.3% | 350.6% | |
| Pacific Century Premium Developments Ltd ($432) | 2.9% | 323.1% | 351.2% | 340.6% | |
| Hon Kwok Land Investment Co Ltd ($160) | 20.6% | 157.3% | 144.5% | 296.3% | |
| |
|---|
| Median (179 companies) | 5.6% | 6.2% | 4.8% | 3.2% | 2.1% |
|---|
| Associated International Hotels Ltd ($105) | 10.6% | 2.7% | 1.0% | 8.0% | 0.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hydoo International Holding Ltd ($1396) | 44.3% | 62.0% | 12.9% | 16.6% | |
| Gemdale Properties & Investment Corp Ltd ($535) | 15.3% | 19.6% | 10.8% | 15.9% | |
| China Overseas Land & Investment Ltd ($688) | | 15.1% | 18.5% | 15.4% | 13.0% |
| Colour Life Services Group Co Ltd ($1778) | 44.2% | 47.9% | 29.3% | 14.5% | |
| Dalian Wanda Commercial Properties Co Ltd ($3699) | 26.8% | 19.6% | 12.3% | 14.4% | |
| |
|---|
| Median (181 companies) | 4.2% | 4.1% | 4.2% | 2.4% | 1.5% |
|---|
| Associated International Hotels Ltd ($105) | 3.3% | 3.9% | 3.8% | 3.7% | 3.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Shui On Land Ltd ($272) | 22.1x | 13.2x | 17.1x | 54.2x | |
| Beijing Capital Land Ltd ($2868) | 7.1x | 4.6x | 11.7x | 49.1x | |
| Talent Property Group Ltd ($760) | | | | 43.0x | |
| Mingfa Group International Co Ltd ($846) | 2.5x | 3.0x | 6.3x | 42.9x | |
| Sunshine 100 China Holdings Ltd ($2608) | 9.9x | 12.4x | 12.9x | 42.3x | |
| |
|---|
| Median (136 companies) | 2.4x | 2.8x | 3.0x | 3.3x | 2.0x |
|---|
| Associated International Hotels Ltd ($105) | 0.2x | 0.1x | -0.0x | -0.2x | -0.2x |
