Chevalier International Holdings Ltd reports 79.5% Net Income decline and 25.7 pp EBITDA Margin decline from 37.5% to 11.8%
27/06/2016 • About Chevalier International Holdings Ltd (
$25) • By InTwits
Chevalier International Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 11.8% in FY2016, 37.5% in FY2015, 12.8% in FY2014, 11.9% in FY2013, 10.4% in FY2012
- Chevalier International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 9.6%.
- CAPEX is quite volatile: 3.0 in FY2016, 23.4 in FY2015, 1,202 in FY2014, 51.7 in FY2013, 26.6 in FY2012
- The company has potentially unprofitable business model: ROIC is at 4.6%
- It operates with medium-size leverage: Net Debt/EBITDA is 1.7x while industry average is 1.7x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Chevalier International Holdings Ltd ($25) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 3,850 | 4,189 | 4,113 | 5,013 | 5,538 | 10.5% |
| Gross Profit | 937 | 1,102 | 1,067 | 1,213 | 1,212 | -0.1% |
| SG&A | | 704 | 718 | 740 | 691 | -6.6% |
| EBITDA | 402 | 499 | 527 | 1,879 | 655 | -65.2% |
| Net Income | 658 | 1,012 | 470 | 1,537 | 315 | -79.5% |
Balance Sheet
|
|---|
| Cash | 1,035 | 1,280 | 1,201 | 2,663 | 2,009 | -24.5% |
| Short Term Debt | 1,559 | 944 | 654 | 590 | 961 | 62.9% |
| Long Term Debt | 1,421 | 3,379 | 3,413 | 2,938 | 2,152 | -26.8% |
Cash flow
|
|---|
| Capex | 74 | 111 | 66 | 102 | 66 | -34.9% |
Ratios
|
|---|
| Revenue growth | 10.3% | 8.8% | -1.8% | 21.9% | 10.5% | |
| EBITDA growth | 72.9% | 24.2% | 5.5% | 256.7% | -65.2% | |
| Gross Margin | 24.3% | 26.3% | 25.9% | 24.2% | 21.9% | -2.3% |
| EBITDA Margin | 10.4% | 11.9% | 12.8% | 37.5% | 11.8% | -25.7% |
| Net Income Margin | 17.1% | 24.2% | 11.4% | 30.7% | 5.7% | -25.0% |
| SG&A, % of revenue | | 16.8% | 17.4% | 14.8% | 12.5% | -2.3% |
| CAPEX, % of revenue | 1.9% | 2.6% | 1.6% | 2.0% | 1.2% | -0.8% |
| ROIC | 4.3% | 4.2% | 3.8% | 14.9% | 4.6% | -10.3% |
| ROE | 13.9% | 18.7% | 7.6% | 21.2% | 4.0% | -17.2% |
| Net Debt/EBITDA | 4.8x | 6.1x | 5.4x | 0.5x | 1.7x | 1.2x |
Revenue and profitability
Chevalier International Holdings Ltd's Revenue surged on 10.5%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 87.4 pp from 12.3% to -75.1% in FY2016.
Gross Margin decreased on 2.3 pp from 24.2% to 21.9% in FY2016. SG&A as a % of Revenue decreased on 2.3 pp from 14.8% to 12.5% in FY2016.
Net Income marign dropped on 25.0 pp from 30.7% to 5.7% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 1.2% in FY2016. Chevalier International Holdings Ltd's CAPEX/Revenue decreased slightly on 1.5 pp from 2.6% in FY2013 to 1.2% in FY2016. It's average CAPEX/Revenue for the last three years was 1.6%.
Return on investment
The company operates at low ROIC (4.57%) and ROE (4.03%). ROIC dropped on 10.3 pp from 14.9% to 4.6% in FY2016. ROE dropped on 17.2 pp from 21.2% to 4.0% in FY2016.
Leverage (Debt)
Debt level is 1.7x Net Debt / EBITDA and 4.8x Debt / EBITDA. Net Debt / EBITDA surged on 1.2x from 0.5x to 1.7x in FY2016. Debt dropped on 11.8% while cash dropped on 24.5%.
Appendix 1: Peers in Engineering&Construction
Below we provide Chevalier International Holdings Ltd benchmarking against other companies in Engineering&Construction 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 |
|---|
| CNQC International Holdings Ltd ($1240) | 21.6% | 91.0% | 103.7% | 807.4% | |
| China National Culture Group Ltd ($745) | | -76.8% | -55.8% | 592.3% | 86.7% |
| Vision Fame International Holding Ltd ($1315) | -9.9% | 45.9% | -10.5% | 105.6% | |
| Sino Credit Holdings Ltd ($628) | -13.8% | | | 97.4% | |
| Grand Ming Group Holdings Ltd ($1271) | | -26.9% | -37.4% | 74.8% | 14.3% |
| |
|---|
| Median (43 companies) | 12.8% | 25.0% | 21.3% | 10.1% | 10.4% |
|---|
| Chevalier International Holdings Ltd ($25) | | 8.8% | -1.8% | 21.9% | 10.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| HNA Infrastructure Company Ltd ($357) | 66.4% | 62.1% | 62.4% | 61.1% | |
| Huayu Expressway Group Ltd ($1823) | 43.6% | 65.6% | 64.0% | 58.9% | |
| Broad Greenstate International Co Ltd ($1253) | 20.1% | 28.7% | 35.8% | 36.7% | |
| Sam Woo Construction Group Ltd ($3822) | 33.2% | 27.3% | 33.6% | 36.0% | 19.8% |
| China National Culture Group Ltd ($745) | 0.9% | 12.1% | 10.3% | 32.3% | 19.2% |
| |
|---|
| Median (38 companies) | 17.0% | 16.1% | 15.4% | 16.0% | 14.1% |
|---|
| Chevalier International Holdings Ltd ($25) | 24.3% | 26.3% | 25.9% | 24.2% | 21.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Huayu Expressway Group Ltd ($1823) | 46.2% | 73.8% | 77.1% | 76.2% | |
| HNA Infrastructure Company Ltd ($357) | 62.8% | 63.7% | 62.8% | 61.7% | |
| Cheung Kong Infrastructure Holdings Ltd ($1038) | 31.2% | 20.6% | 36.2% | 60.9% | |
| Beijing Capital International Airport Co Ltd ($694) | 53.4% | 52.9% | 50.3% | 51.6% | |
| China National Culture Group Ltd ($745) | -30.4% | -72.7% | -279.2% | 45.3% | -14.6% |
| |
|---|
| Median (43 companies) | 10.0% | 9.7% | 9.1% | 8.0% | 3.1% |
|---|
| Chevalier International Holdings Ltd ($25) | 10.4% | 11.9% | 12.8% | 37.5% | 11.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| HNA Infrastructure Company Ltd ($357) | 36.8% | 5.7% | 85.4% | 155.4% | |
| Grand Ming Group Holdings Ltd ($1271) | 0.0% | 16.1% | 8.7% | 33.8% | 14.0% |
| Beijing Capital International Airport Co Ltd ($694) | 3.5% | 6.6% | 7.2% | 28.2% | |
| Louis XIII Holdings Ltd ($577) | 1.2% | 29.5% | 9.3% | 16.1% | 47.3% |
| PYI Corp Ltd ($498) | 3.7% | 4.2% | 24.5% | 13.1% | 19.7% |
| |
|---|
| Median (43 companies) | 2.4% | 3.9% | 1.7% | 2.0% | 3.5% |
|---|
| Chevalier International Holdings Ltd ($25) | 1.9% | 2.6% | 1.6% | 2.0% | 1.2% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| In Construction Holdings Ltd ($1500) | | 52.8% | 37.0% | 49.4% | 40.4% |
| Chun Sing Engineering Holdings Ltd ($2277) | | 98.3% | 54.9% | 43.7% | |
| Sam Woo Construction Group Ltd ($3822) | | 28.2% | 28.7% | 33.5% | 18.3% |
| Ngai Shun Holdings Ltd ($1246) | 68.8% | 77.2% | 45.2% | 31.0% | |
| Broad Greenstate International Co Ltd ($1253) | 33.2% | 85.1% | 51.2% | 26.0% | |
| |
|---|
| Median (45 companies) | 6.5% | 6.0% | 4.5% | 5.4% | 3.1% |
|---|
| Chevalier International Holdings Ltd ($25) | 4.3% | 4.2% | 3.8% | 14.9% | 4.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Deson Development International Holdings ($262) | 3.8x | 4.9x | 13.7x | 47.0x | |
| Hsin Chong Construction Group Ltd ($404) | 1.8x | 8.0x | 10.2x | 41.7x | |
| China Resources and Transportation Group Ltd ($269) | | | 66.7x | 29.7x | |
| CNC Holdings Ltd ($8356) | | 22.0x | 21.9x | 24.3x | 2.7x |
| Louis XIII Holdings Ltd ($577) | 0.8x | -12.5x | -23.2x | 19.1x | |
| |
|---|
| Median (37 companies) | 0.8x | 0.2x | 0.3x | 1.9x | -0.4x |
|---|
| Chevalier International Holdings Ltd ($25) | 4.8x | 6.1x | 5.4x | 0.5x | 1.7x |
