HKC International Holdings Ltd revenue increased on 3.4% and EBITDA Margin showed almost no change
29/06/2016 • About HKC International Holdings Ltd (
$248) • By InTwits
HKC International Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- HKC International Holdings Ltd doesn't have a profitable business model yet: FY2016 ROIC is -2.0%
- The company operates at negative EBITDA Margin: -1.7%
- HKC International Holdings Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 was 0.0%. On average EBITDA Margin was -4.5% for the sames years0
- HKC International Holdings Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.7%. At the same time it's in pair with industry average of 6.0%.
- CAPEX is quite volatile: 1.3 in FY2016, 1.1 in FY2015, 29.9 in FY2014, 2.1 in FY2013, 19.8 in FY2012
- The company has unprofitable business model: ROIC is at -2.0%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
HKC International Holdings Ltd ($248) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 361.7 | 268.2 | 263.1 | 219.7 | 227.2 | 3.4% |
| Gross Profit | 66.4 | 67.3 | 50.9 | 48.9 | 50.7 | 3.6% |
| SG&A | | 90.1 | 72.0 | 57.4 | 58.5 | 1.9% |
| EBITDA | -23.9 | -13.9 | -15.2 | -4.1 | -3.8 | |
| Net Income | -6.6 | -5.7 | -12.2 | -3.7 | -22.3 | |
Balance Sheet
|
|---|
| Cash | 45.7 | 42.8 | 12.2 | 5.5 | 15.4 | 181.6% |
| Short Term Debt | 38.2 | 40.6 | 50.2 | 65.8 | 77.2 | 17.3% |
| Long Term Debt | 0.0 | 0.1 | 0.0 | 0.0 | 0.0 | -4.2% |
Cash flow
|
|---|
| Capex | 19.8 | 2.1 | 29.9 | 1.1 | 1.3 | 24.0% |
Ratios
|
|---|
| Revenue growth | -61.5% | -25.8% | -1.9% | -16.5% | 3.4% | |
| EBITDA growth | -389.7% | -42.1% | 9.6% | -73.1% | -6.4% | |
| Gross Margin | 18.3% | 25.1% | 19.3% | 22.3% | 22.3% | 0.0% |
| EBITDA Margin | -6.6% | -5.2% | -5.8% | -1.9% | -1.7% | 0.2% |
| Net Income Margin | -1.8% | -2.1% | -4.6% | -1.7% | -9.8% | -8.1% |
| SG&A, % of revenue | | 33.6% | 27.4% | 26.1% | 25.7% | -0.4% |
| CAPEX, % of revenue | 5.5% | 0.8% | 11.4% | 0.5% | 0.6% | 0.1% |
| ROIC | -8.7% | -5.9% | -5.7% | -2.1% | -2.0% | 0.1% |
| ROE | -2.2% | -1.9% | -4.1% | -1.2% | -7.8% | -6.6% |
Revenue and profitability
HKC International Holdings Ltd's Revenue increased on 3.4%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 3.0 pp from -5.0% to -8.0% 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 decreased on 8.1 pp from -1.7% to -9.8% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 HKC International Holdings Ltd had CAPEX/Revenue of 0.59%. HKC International Holdings Ltd showed almost no change in CAPEX/Revenue from FY2013 to FY2016. It's average level of CAPEX/Revenue for the last three years was 4.2%.
Return on investment
The company operates at negative ROIC (-1.95%) and ROE (-7.82%). ROIC showed almost no change in FY2016. ROE decreased on 6.6 pp from -1.2% to -7.8% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.2x and Debt / EBITDA is . Net Debt / EBITDA didn't change in FY2016. Debt jumped on 17.3% while cash jumped on 182%.
Appendix 1: Peers in Distribution/Wholesale
Below we provide HKC International Holdings Ltd benchmarking against other companies in Distribution/Wholesale 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 |
|---|
| C Y Foundation Group Ltd ($1182) | | -65.6% | 5.9% | 214.6% | -14.6% |
| China Fortune Holdings Ltd ($110) | -64.7% | -68.2% | -71.0% | 174.2% | |
| Hailiang International Holdings Ltd ($2336) | 9.7% | -30.8% | -69.1% | 99.7% | |
| Forefront Group Ltd ($885) | | 504.6% | 3,871.0% | 72.0% | |
| Yestar International Holdings Co Ltd ($2393) | -2.2% | 22.8% | 30.5% | 60.3% | |
| |
|---|
| Median (35 companies) | 2.5% | 2.1% | 1.4% | -0.5% | -14.9% |
|---|
| HKC International Holdings Ltd ($248) | | -25.8% | -1.9% | -16.5% | 3.4% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Yunnan Tin Minerals Group Co Ltd ($263) | 79.6% | 66.3% | | 98.7% | |
| Goldin Financial Holdings Ltd ($530) | 75.3% | 71.7% | 74.8% | 73.8% | |
| YGM Trading Ltd ($375) | 66.5% | 67.4% | 64.0% | 62.5% | 58.7% |
| Goldlion Holdings Ltd ($533) | 56.4% | 54.1% | 55.7% | 60.0% | |
| E.Bon Holdings Ltd ($599) | 40.3% | 37.4% | 35.8% | 39.6% | 42.4% |
| |
|---|
| Median (33 companies) | 17.3% | 17.1% | 18.0% | 20.8% | 24.4% |
|---|
| HKC International Holdings Ltd ($248) | 18.3% | 25.1% | 19.3% | 22.3% | 22.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China LNG Group Ltd ($931) | 95.1% | 76.4% | 97.9% | 1,277.8% | |
| Goldin Financial Holdings Ltd ($530) | 163.7% | 613.4% | 285.7% | 364.1% | |
| China Infrastructure Investment Ltd ($600) | -274.9% | 120.0% | 52.0% | 134.5% | |
| China Yunnan Tin Minerals Group Co Ltd ($263) | -1,064.4% | -252.1% | | 62.8% | |
| Goldlion Holdings Ltd ($533) | 25.8% | 23.4% | 22.5% | 22.8% | |
| |
|---|
| Median (36 companies) | 2.6% | 2.5% | 4.6% | 4.9% | -5.2% |
|---|
| HKC International Holdings Ltd ($248) | -6.6% | -5.2% | -5.8% | -1.9% | -1.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SIS International Holdings ($529) | 13.4% | 31.8% | 14.8% | 49.8% | |
| Inspur International Ltd ($596) | 8.4% | 12.2% | 33.6% | 25.6% | |
| China LNG Group Ltd ($931) | 11.1% | 0.3% | 0.6% | 15.6% | |
| YGM Trading Ltd ($375) | 1.8% | 2.1% | 3.5% | 14.5% | 4.0% |
| Victory Group Ltd ($1139) | 0.7% | 0.1% | 6.1% | 12.6% | |
| |
|---|
| Median (35 companies) | 1.3% | 1.8% | 1.6% | 1.2% | 3.5% |
|---|
| HKC International Holdings Ltd ($248) | 5.5% | 0.8% | 11.4% | 0.5% | 0.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China LNG Group Ltd ($931) | 8.4% | 7.4% | 87.0% | 56.2% | |
| Powerwell Pacific Holdings Ltd ($8265) | 6.4% | 6.4% | 23.6% | 27.1% | |
| Yestar International Holdings Co Ltd ($2393) | 28.8% | 24.1% | 26.2% | 25.4% | |
| E.Bon Holdings Ltd ($599) | 7.0% | 7.2% | 3.3% | 16.9% | 17.4% |
| Goldin Financial Holdings Ltd ($530) | 5.9% | 20.6% | 10.4% | 16.0% | |
| |
|---|
| Median (37 companies) | 2.7% | 1.7% | 3.2% | 2.8% | -8.8% |
|---|
| HKC International Holdings Ltd ($248) | -8.7% | -5.9% | -5.7% | -2.1% | -2.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SIS International Holdings ($529) | -1.8x | 7.0x | 7.2x | 16.8x | |
| Leeport Holdings Ltd ($387) | | | | 16.1x | |
| Takson Holdings Ltd ($918) | | 11.5x | 11.7x | 15.7x | |
| Sheng Yuan Holdings Ltd ($851) | | | 19.3x | 15.4x | |
| Forefront Group Ltd ($885) | | | -0.0x | 15.3x | |
| |
|---|
| Median (27 companies) | -0.2x | -0.6x | -0.0x | -0.2x | -2.7x |
|---|
