Come Sure Group Holdings Ltd Net Debt / EBITDA surged on 397.9x from 3.4x to 401.3x in 2016 while Revenue dropped on 11.5%
30/06/2016 • About Come Sure Group Holdings Ltd (
$794) • By InTwits
Come Sure Group Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Come Sure Group Holdings Ltd doesn't have a profitable business model yet: FY2016 ROIC is -2.6%
- EBITDA Margin is quite volatile: 0.1% in FY2016, 8.3% in FY2015, 8.1% in FY2014, 6.8% in FY2013, 5.3% in FY2012
- Come Sure Group Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.9%. At the same time it's a lot of higher than industry average of 6.9%.
- CAPEX is quite volatile: 32.3 in FY2016, 39.3 in FY2015, 17.5 in FY2014, 181 in FY2013, 82.7 in FY2012
- The company has unprofitable business model: ROIC is at -2.6%
- It operates with high leverage: Net Debt/EBITDA is 401.3x while industry average is 25.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Come Sure Group Holdings Ltd ($794) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 772.1 | 766.7 | 895.4 | 921.2 | 815.1 | -11.5% |
| Gross Profit | 135.4 | 159.0 | 200.1 | 206.6 | 170.1 | -17.7% |
| SG&A | 120.7 | 136.7 | 162.4 | 165.5 | 156.7 | -5.3% |
| EBITDA | 40.6 | 52.1 | 72.3 | 76.9 | 0.8 | -98.9% |
| Net Income | 11.3 | 20.1 | 37.2 | 53.9 | -66.0 | -222.4% |
Balance Sheet
|
|---|
| Cash | 102.3 | 126.3 | 174.9 | 204.2 | 121.9 | -40.3% |
| Short Term Debt | 206.7 | 324.5 | 436.8 | 457.1 | 441.5 | -3.4% |
| Long Term Debt | 43.2 | 16.5 | 12.9 | 10.1 | 8.7 | -14.5% |
Cash flow
|
|---|
| Capex | 82.7 | 181.0 | 17.5 | 39.3 | 32.3 | -17.8% |
Ratios
|
|---|
| Revenue growth | 10.7% | -0.7% | 16.8% | 2.9% | -11.5% | |
| EBITDA growth | -6.9% | 28.3% | 39.0% | 6.3% | -98.9% | |
| Gross Margin | 17.5% | 20.7% | 22.3% | 22.4% | 20.9% | -1.6% |
| EBITDA Margin | 5.3% | 6.8% | 8.1% | 8.3% | 0.1% | -8.2% |
| Net Income Margin | 1.5% | 2.6% | 4.2% | 5.9% | -8.1% | -14.0% |
| SG&A, % of revenue | 15.6% | 17.8% | 18.1% | 18.0% | 19.2% | 1.3% |
| CAPEX, % of revenue | 10.7% | 23.6% | 2.0% | 4.3% | 4.0% | -0.3% |
| ROIC | 2.5% | 2.4% | 4.2% | 4.4% | -2.6% | -7.0% |
| ROE | 2.3% | 3.7% | 6.3% | 8.6% | -11.1% | -19.7% |
| Net Debt/EBITDA | 3.6x | 4.1x | 3.8x | 3.4x | 401.3x | 397.9x |
Revenue and profitability
The company's Revenue dropped on 11.5%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 8.2 pp from 8.3% to 0.10% in FY2016.
Gross Margin decreased slightly on 1.6 pp from 22.4% to 20.9% in FY2016. SG&A as a % of Revenue increased slightly on 1.3 pp from 18.0% to 19.2% in FY2016.
Net Income marign dropped on 14.0 pp from 5.9% to -8.1% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 Come Sure Group Holdings Ltd had CAPEX/Revenue of 4.0%. Come Sure Group Holdings Ltd showed big decline in CAPEX/Revenue of 19.6 pp from 23.6% in FY2013 to 4.0% in FY2016. For the last three years the average CAPEX/Revenue was 3.4%.Battling declining revenue Come Sure Group Holdings Ltd made large investments to CAPEX (3,948% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-2.62%) and ROE (-11.15%). ROIC decreased on 7.0 pp from 4.4% to -2.6% in FY2016. ROE dropped on 19.7 pp from 8.6% to -11.1% in FY2016.
Leverage (Debt)
Debt level is 401.3x Net Debt / EBITDA and 550.3x Debt / EBITDA. Net Debt / EBITDA surged on 397.9x from 3.4x to 401.3x in FY2016. Debt decreased on 3.7% while cash dropped on 40.3%.
Appendix 1: Peers in Packaging&Containers
Below we provide Come Sure Group Holdings Ltd benchmarking against other companies in Packaging&Containers 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 |
|---|
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 34.9% | 17.5% | -6.5% | 69.5% | |
| Hao Tian Development Group Ltd ($474) | | | | 51.0% | 113.4% |
| Jin Cai Holdings Co Ltd ($1250) | 2.1% | -6.3% | -3.1% | 40.8% | |
| Huaxi Holdings Co Ltd ($1689) | | 5.0% | -5.1% | 12.5% | -15.3% |
| Huajun Holdings Ltd ($377) | | 3.3% | 3.4% | 10.4% | 73.2% |
| |
|---|
| Median (19 companies) | 3.2% | 5.3% | 0.7% | 3.0% | 37.5% |
|---|
| Come Sure Group Holdings Ltd ($794) | | -0.7% | 16.8% | 2.9% | -11.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | 36.6% | 39.1% | 37.7% | 44.7% | |
| Huaxi Holdings Co Ltd ($1689) | 19.0% | 28.2% | 40.9% | 37.5% | 37.3% |
| China For You Group Co Ltd ($572) | 12.4% | | 34.6% | 31.9% | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 34.3% | 36.5% | 32.8% | 31.4% | |
| Kith Holdings Ltd ($1201) | 30.8% | 31.9% | 31.4% | 30.5% | |
| |
|---|
| Median (18 companies) | 20.9% | 19.8% | 22.8% | 21.8% | 22.1% |
|---|
| Come Sure Group Holdings Ltd ($794) | 17.5% | 20.7% | 22.3% | 22.4% | 20.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Huaxi Holdings Co Ltd ($1689) | 14.5% | 21.2% | 27.1% | 29.1% | 25.7% |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 27.9% | 30.7% | 27.4% | 26.3% | |
| Greatview Aseptic Packaging Co Ltd ($468) | 25.9% | 23.1% | 21.6% | 23.4% | |
| Lee & Man Paper Manufacturing Ltd ($2314) | 14.6% | 17.2% | 18.7% | 21.6% | |
| Kith Holdings Ltd ($1201) | 21.6% | 19.4% | 20.1% | 20.5% | |
| |
|---|
| Median (19 companies) | 14.5% | 15.6% | 13.2% | 11.6% | 7.2% |
|---|
| Come Sure Group Holdings Ltd ($794) | 5.3% | 6.8% | 8.1% | 8.3% | 0.1% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | 0.0% | 0.0% | 3.0% | 122.3% | |
| Sheen Tai Holdings Grp Co Ltd ($1335) | 3.7% | 1.2% | 3.1% | 42.2% | |
| Hao Tian Development Group Ltd ($474) | 81.6% | | 13.0% | 25.4% | 4.3% |
| Lee & Man Paper Manufacturing Ltd ($2314) | 19.7% | 13.7% | 13.1% | 17.1% | |
| Kith Holdings Ltd ($1201) | 3.7% | 4.8% | 3.3% | 13.3% | |
| |
|---|
| Median (19 companies) | 5.2% | 4.4% | 4.1% | 5.5% | 3.1% |
|---|
| Come Sure Group Holdings Ltd ($794) | 10.7% | 23.6% | 2.0% | 4.3% | 4.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Huaxi Holdings Co Ltd ($1689) | 21.4% | 28.5% | 26.2% | 23.6% | 16.6% |
| Greatview Aseptic Packaging Co Ltd ($468) | 20.2% | 18.9% | 15.7% | 17.7% | |
| China Aluminum Cans Holdings Ltd ($6898) | 19.7% | 14.6% | 20.2% | 17.1% | |
| Kith Holdings Ltd ($1201) | 6.9% | 5.6% | 7.8% | 12.2% | |
| Lee & Man Paper Manufacturing Ltd ($2314) | 7.2% | 8.7% | 8.0% | 9.2% | |
| |
|---|
| Median (19 companies) | 8.1% | 7.0% | 7.3% | 5.4% | 6.5% |
|---|
| Come Sure Group Holdings Ltd ($794) | 2.5% | 2.4% | 4.2% | 4.4% | -2.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sino Haijing Holdings Ltd ($1106) | 6.4x | 6.1x | 6.2x | 10.1x | |
| Huajun Holdings Ltd ($377) | 0.0x | 0.3x | 0.7x | 9.9x | 19.9x |
| Zhengye International Holdings Co Ltd ($3363) | 6.2x | 6.4x | 7.8x | 5.5x | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 9.4x | 6.7x | 7.4x | 4.4x | |
| Jin Bao Bao Holdings Ltd ($1239) | -1.7x | -1.7x | -1.2x | 4.2x | |
| |
|---|
| Median (16 companies) | 1.0x | 0.6x | 0.5x | 1.3x | -0.6x |
|---|
| Come Sure Group Holdings Ltd ($794) | 3.6x | 4.1x | 3.8x | 3.4x | 401.3x |
