Wai Yuen Tong Medicine Holdings Ltd revenue growth decelerated from 106% in FY2015 to 40.9% in FY2016
28/06/2016 • About Wai Yuen Tong Medicine Holdings Ltd (
$897) • By InTwits
Wai Yuen Tong Medicine Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Wai Yuen Tong Medicine Holdings 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 -1.0%0
- Wai Yuen Tong Medicine Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.8%.
- The company has potentially unprofitable business model: ROIC is at 2.5%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Wai Yuen Tong Medicine Holdings Ltd ($897) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 662 | 965 | 864 | 1,776 | 2,503 | 40.9% |
| Gross Profit | 89 | 71 | 22 | -23 | 75 | |
| SG&A | | | | 88 | 77 | -12.3% |
| EBITDA | 31 | 26 | -43 | -98 | 18 | |
| Net Income | 33 | 26 | -48 | -117 | 20 | |
Balance Sheet
|
|---|
| Cash | 66 | 50 | 267 | 189 | 398 | 110.8% |
| Short Term Debt | 67 | 49 | 3 | 33 | 2 | -94.0% |
| Long Term Debt | 0 | 0 | 178 | 174 | 185 | 6.1% |
Cash flow
|
|---|
| Capex | 4 | 6 | 9 | 32 | 3 | -91.0% |
Ratios
|
|---|
| Revenue growth | -9.9% | 45.9% | -10.5% | 105.6% | 40.9% | |
| EBITDA growth | -57.6% | -15.8% | -266.4% | 126.4% | -117.9% | |
| Gross Margin | 13.5% | 7.4% | 2.5% | -1.3% | 3.0% | 4.3% |
| EBITDA Margin | 4.7% | 2.7% | -5.0% | -5.5% | 0.7% | 6.2% |
| Net Income Margin | 5.0% | 2.7% | -5.6% | -6.6% | 0.8% | 7.4% |
| SG&A, % of revenue | | | | 4.9% | 3.1% | -1.9% |
| CAPEX, % of revenue | 0.6% | 0.6% | 1.0% | 1.8% | 0.1% | -1.7% |
| ROIC | 13.6% | 9.3% | -16.9% | -37.5% | 2.5% | 40.0% |
| ROE | 24.9% | 13.8% | -28.2% | -137.3% | 11.4% | 148.7% |
| Net Debt/EBITDA | 0.0x | -0.1x | | | -12.0x | -12.0x |
Revenue and profitability
The company's Revenue surged on 40.9%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 6.2 pp from -5.5% to 0.70% in FY2016.
Gross Margin increased on 4.3 pp from -1.3% to 3.0% in FY2016. SG&A as a % of Revenue decreased slightly on 1.9 pp from 4.9% to 3.1% in FY2016.
Net Income marign increased on 7.4 pp from -6.6% to 0.80% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.11% in FY2016. CAPEX/Revenue decreased slightly on 0.52 pp from 0.63% in FY2013 to 0.11% in FY2016. For the last three years the average CAPEX/Revenue was 0.96%.
Return on investment
The company operates at low ROIC (2.49%) and ROE (11.37%). ROIC surged on 40.0 pp from -37.5% to 2.5% in FY2016. ROE jumped on 149 pp from -137% to 11.4% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -12.0x and Debt / EBITDA is 10.6x. Net Debt / EBITDA dropped12.0x from to -12.0x in FY2016. Debt decreased on 9.8% while cash jumped on 111%.
Appendix 1: Peers in Pharmaceuticals
Below we provide Wai Yuen Tong Medicine Holdings Ltd benchmarking against other companies in Pharmaceuticals 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 |
|---|
| China Health Group Inc ($8225) | 58.5% | -48.0% | -60.1% | 244.1% | |
| Oriental Unicorn Agricultural Group Ltd ($8120) | 30.2% | -78.1% | 16.8% | 100.8% | |
| China Traditional Chinese Medicine Co Ltd ($570) | 22.3% | 35.2% | 90.0% | 40.0% | |
| Shandong Luoxin Pharmaceutical Group Stock Co Ltd ($8058) | 37.0% | 13.5% | 9.4% | 30.5% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 69.3% | 84.4% | 24.0% | 27.5% | |
| |
|---|
| Median (40 companies) | 16.9% | 13.5% | 15.7% | 2.1% | -11.6% |
|---|
| Wai Yuen Tong Medicine Holdings Ltd ($897) | | 45.9% | -10.5% | 105.6% | 40.9% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Luye Pharma Group Ltd ($2186) | 83.5% | 83.6% | 81.0% | 81.4% | |
| Consun Pharmaceutical Group Ltd ($1681) | 75.7% | 79.1% | 78.3% | 80.7% | |
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 82.0% | 81.5% | 80.9% | 79.9% | |
| Sino Biopharmaceutical Ltd ($1177) | 78.5% | 77.5% | 76.4% | 77.7% | |
| China Health Group Inc ($8225) | 43.4% | 33.6% | 76.2% | 75.7% | |
| |
|---|
| Median (39 companies) | 40.9% | 39.7% | 50.9% | 50.0% | 57.4% |
|---|
| Wai Yuen Tong Medicine Holdings Ltd ($897) | 13.5% | 7.4% | 2.5% | -1.3% | 3.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 193.8% | 205,840.0% | -15,344.8% | 49,650.0% | |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 38.8% | 65.4% | 70.9% | 93.3% | |
| Hua Han Bio-Pharmaceutical Holdings Ltd ($587) | 60.6% | 21.0% | 28.8% | 61.1% | |
| U-Home Group Holdings Ltd ($2327) | 9.8% | -16.6% | -46.7% | 51.7% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 41.3% | 45.4% | 47.5% | 49.1% | |
| |
|---|
| Median (40 companies) | 20.3% | 20.2% | 21.4% | 21.6% | -5.0% |
|---|
| Wai Yuen Tong Medicine Holdings Ltd ($897) | 4.7% | 2.7% | -5.0% | -5.5% | 0.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hao Wen Holdings Ltd ($8019) | 30.0% | 2.3% | 38.2% | 44.8% | |
| Hua Han Bio-Pharmaceutical Holdings Ltd ($587) | 0.9% | 1.4% | 7.6% | 40.5% | |
| Lee's Pharmaceutical Holdings Ltd ($950) | 18.6% | 20.9% | 7.1% | 26.1% | |
| Tianda Pharmaceuticals Ltd ($455) | 6.0% | 3.9% | 10.5% | 24.4% | 22.9% |
| Lijun International Pharmaceutical Holding Co Ltd ($2005) | 16.8% | 52.4% | 39.6% | 18.7% | |
| |
|---|
| Median (39 companies) | 8.5% | 10.1% | 7.6% | 4.7% | 22.9% |
|---|
| Wai Yuen Tong Medicine Holdings Ltd ($897) | 0.6% | 0.6% | 1.0% | 1.8% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sino Biopharmaceutical Ltd ($1177) | 26.2% | 26.8% | 26.5% | 26.2% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 25.3% | 27.5% | 23.8% | 25.9% | |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 13.7% | 18.3% | 22.0% | 25.4% | |
| Dawnrays Pharmaceutical Holdings Ltd ($2348) | 12.6% | 14.0% | 17.8% | 23.5% | |
| Lee's Pharmaceutical Holdings Ltd ($950) | 26.1% | 22.0% | 22.4% | 22.7% | |
| |
|---|
| Median (41 companies) | 12.2% | 9.2% | 11.6% | 10.0% | -4.4% |
|---|
| Wai Yuen Tong Medicine Holdings Ltd ($897) | 13.6% | 9.3% | -16.9% | -37.5% | 2.5% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 2.3x | 3.7x | | 22.2x | |
| U-Home Group Holdings Ltd ($2327) | 10.1x | | | 9.9x | |
| Lansen Pharmaceutical Holdings Ltd ($503) | 1.7x | 2.8x | 3.4x | 4.7x | |
| China Grand Pharmaceutical and Healthcare Holdings Ltd ($512) | 5.4x | 4.0x | 3.4x | 4.3x | |
| United Laboratories International Holdings Ltd/The ($3933) | 6.5x | 4.6x | 4.2x | 4.0x | |
| |
|---|
| Median (34 companies) | -0.4x | -0.6x | -0.6x | -0.4x | -11.7x |
|---|
