Chuang's China Investments Ltd CAPEX jumped on 2,518% while Revenue dropped on 53.4%
27/06/2016 • About Chuang's China Investments Ltd (
$298) • By InTwits
Chuang's China Investments Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Chuang's China Investments Ltd doesn't have a profitable business model yet: FY2016 ROIC is 0.6%
- EBITDA Margin is quite volatile: 6.9% in FY2016, 22.8% in FY2015, 10.6% in FY2014, 11.6% in FY2013, 44.0% in FY2012
- Chuang's China Investments Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.6%. At the same time it's in pair with industry average of 8.7%.
- CAPEX is quite volatile: 178 in FY2016, 6.8 in FY2015, 14.7 in FY2014, 9.6 in FY2013, 12.2 in FY2012
- The company has potentially unprofitable business model: ROIC is at 0.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Chuang's China Investments Ltd ($298) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,487 | 510 | 805 | 1,009 | 470 | -53.4% |
| Gross Profit | 805 | 183 | 277 | 394 | 191 | -51.4% |
| SG&A | | 125 | 205 | 176 | 171 | -2.8% |
| EBITDA | 654 | 59 | 85 | 230 | 32 | -86.0% |
| Net Income | 449 | 40 | 110 | 94 | 85 | -10.0% |
Balance Sheet
|
|---|
| Cash | 837 | 981 | 1,115 | 871 | 565 | -35.1% |
| Short Term Debt | 42 | 76 | 260 | 604 | 407 | -32.7% |
| Long Term Debt | 0 | 242 | 145 | 19 | 302 | 1,499.2% |
Cash flow
|
|---|
| Capex | 12 | 10 | 15 | 7 | 178 | 2,517.7% |
Ratios
|
|---|
| Revenue growth | 651.0% | -65.7% | 57.9% | 25.3% | -53.4% | |
| EBITDA growth | -3,490.8% | -91.0% | 44.5% | 170.5% | -86.0% | |
| Gross Margin | 54.1% | 36.0% | 34.4% | 39.0% | 40.7% | 1.7% |
| EBITDA Margin | 44.0% | 11.6% | 10.6% | 22.8% | 6.9% | -16.0% |
| Net Income Margin | 30.2% | 7.9% | 13.7% | 9.4% | 18.1% | 8.7% |
| SG&A, % of revenue | | 24.6% | 25.5% | 17.4% | 36.4% | 18.9% |
| CAPEX, % of revenue | 0.8% | 1.9% | 1.8% | 0.7% | 37.9% | 37.2% |
| ROIC | 22.9% | 1.5% | 2.2% | 6.1% | 0.6% | -5.5% |
| ROE | 20.1% | 1.6% | 4.4% | 3.7% | 3.3% | -0.3% |
| Net Debt/EBITDA | -1.2x | -11.3x | -8.3x | -1.1x | 4.4x | 5.5x |
Revenue and profitability
The company's Revenue dropped on 53.4%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 16.0 pp from 22.8% to 6.9% in FY2016.
Gross Margin increased slightly on 1.7 pp from 39.0% to 40.7% in FY2016. SG&A as a % of Revenue jumped on 18.9 pp from 17.4% to 36.4% in FY2016.
Net Income marign increased on 8.7 pp from 9.4% to 18.1% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 the company had CAPEX/Revenue of 37.9%. Chuang's China Investments Ltd showed fast CAPEX/Revenue growth of 36.0 pp from 1.9% in FY2013 to 37.9% in FY2016. Average CAPEX/Revenue for the last three years was 13.5%.Chuang's China Investments Ltd has spent a lot to CAPEX (553% of EBITDA) which didn't stop revenue from falling.
Return on investment
The company operates at low ROIC (0.55%) and ROE (3.32%). ROIC decreased on 5.5 pp from 6.1% to 0.55% in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Debt level is 4.4x Net Debt / EBITDA and 22.0x Debt / EBITDA. Net Debt / EBITDA jumped on 5.5x from -1.1x to 4.4x in FY2016. Debt surged on 13.7% while cash dropped on 35.1%.
Appendix 1: Peers in Holding Companies-Divers
Below you can find Chuang's China Investments Ltd benchmarking vs. other companies in Holding Companies-Divers 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 |
|---|
| Beijing Development HK Ltd ($154) | 12.5% | | | 1,048.9% | |
| CIAM Group Ltd ($378) | -62.2% | 47.9% | -40.0% | 211.5% | |
| Melco International Development Ltd ($200) | 16.5% | 21.7% | 3.0% | 134.9% | |
| New Century Group Hong Kong Ltd ($234) | -68.9% | 326.7% | -70.3% | 118.2% | |
| Greater China Holdings Ltd ($431) | -35.8% | -72.1% | 67.3% | 110.3% | |
| |
|---|
| Median (43 companies) | 12.2% | 5.0% | 9.6% | 0.5% | -5.8% |
|---|
| Chuang's China Investments Ltd ($298) | | -65.7% | 57.9% | 25.3% | -53.4% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| New Century Group Hong Kong Ltd ($234) | 27.3% | 85.2% | 82.8% | 91.5% | |
| Melco International Development Ltd ($200) | 63.1% | 52.9% | 54.5% | 79.4% | |
| CIAM Group Ltd ($378) | | | | 75.8% | |
| Emperor International Holdings Ltd ($163) | 71.3% | 64.9% | 79.2% | 75.3% | 55.3% |
| Heng Fai Enterprises Ltd ($185) | 89.0% | 89.5% | 58.3% | 74.7% | |
| |
|---|
| Median (38 companies) | 32.9% | 34.6% | 30.8% | 34.2% | 22.1% |
|---|
| Chuang's China Investments Ltd ($298) | 54.1% | 36.0% | 34.4% | 39.0% | 40.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| New Century Group Hong Kong Ltd ($234) | -5.5% | 78.8% | 58.3% | 85.0% | |
| Emperor International Holdings Ltd ($163) | 180.7% | 131.8% | 100.6% | 73.9% | -20.1% |
| Pioneer Global Group Ltd ($224) | -0.5% | -9.9% | -11.6% | 64.3% | |
| C C Land Holdings Ltd ($1224) | 27.0% | 23.6% | 24.6% | 55.7% | |
| China Merchants Holdings International Co Ltd ($144) | 56.4% | 50.8% | 45.2% | 55.7% | |
| |
|---|
| Median (43 companies) | 2.2% | 2.0% | 5.8% | 6.2% | -20.1% |
|---|
| Chuang's China Investments Ltd ($298) | 44.0% | 11.6% | 10.6% | 22.8% | 6.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Heng Fai Enterprises Ltd ($185) | 4.8% | 77.1% | 310.0% | 458.1% | |
| Chinney Investments Ltd ($216) | 17.5% | 103.4% | 111.3% | 230.9% | |
| China Investments Holdings Ltd ($132) | 4.8% | 81.9% | 382.2% | 222.5% | |
| Goldin Properties Holdings Ltd ($283) | 2,178.4% | 1,190.0% | 50.1% | 202.4% | |
| Carnival Group International Holdings Ltd ($996) | | 137.9% | 61.0% | 133.3% | |
| |
|---|
| Median (43 companies) | 2.6% | 3.7% | 6.6% | 9.2% | 7.0% |
|---|
| Chuang's China Investments Ltd ($298) | 0.8% | 1.9% | 1.8% | 0.7% | 37.9% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| C C Land Holdings Ltd ($1224) | 7.4% | 5.3% | 7.9% | 15.0% | |
| Chinney Alliance Group Ltd ($385) | 6.4% | 8.1% | 13.6% | 15.0% | |
| Niraku GC Holdings Inc ($1245) | | 19.0% | 18.8% | 13.1% | 2.7% |
| Top Spring International Holdings Ltd ($3688) | 15.6% | 6.9% | 7.3% | 8.0% | |
| New Century Group Hong Kong Ltd ($234) | -1.7% | 11.7% | 1.7% | 7.3% | |
| |
|---|
| Median (43 companies) | -0.2% | 0.0% | 0.7% | 0.2% | 0.3% |
|---|
| Chuang's China Investments Ltd ($298) | 22.9% | 1.5% | 2.2% | 6.1% | 0.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Chinney Investments Ltd ($216) | 10.3x | 63.7x | 48.6x | 93.7x | |
| Carnival Group International Holdings Ltd ($996) | | | 23.7x | 92.3x | |
| Multifield International Holdings Ltd ($898) | 3.2x | 7.3x | 3.0x | 55.9x | |
| CIAM Group Ltd ($378) | | | | 32.6x | |
| Chuang's Consortium International Ltd ($367) | 0.7x | 5.0x | | 23.9x | |
| |
|---|
| Median (24 companies) | 2.5x | 3.1x | 3.0x | 2.9x | 4.3x |
|---|
| Chuang's China Investments Ltd ($298) | -1.2x | -11.3x | -8.3x | -1.1x | 4.4x |
