Ngai Shun Holdings Ltd Net Income dropped on 314% and EBITDA Margin dropped on 19.7 pp from 20.5% to 0.73%
30/06/2016 • About Ngai Shun Holdings Ltd (
$1246) • By InTwits
Ngai Shun Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ngai Shun Holdings Ltd doesn't have a profitable business model yet: FY2016 ROIC is -2.9%
- EBITDA Margin is declining: 0.7% in FY2016 vs. 20.5% in FY2015 vs. 19.5% in FY2012
- EBITDA Margin is quite volatile: 0.7% in FY2016, 20.5% in FY2015, 20.7% in FY2014, 24.7% in FY2013, 19.5% in FY2012
- Ngai Shun Holdings Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.5%. At the same time it's in pair with industry average of 20.9%.
- CAPEX is quite volatile: 46.9 in FY2016, 36.5 in FY2015, 36.3 in FY2014, 14.4 in FY2013, 14.4 in FY2012
- The company has unprofitable business model: ROIC is at -2.9%
- It operates with high leverage: Net Debt/EBITDA is 257.8x while industry average is 11.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Ngai Shun Holdings Ltd ($1246) key annual financial indicators
| mln. | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 249.6 | 356.1 | 486.9 | 558.2 | 532.2 | -4.7% |
| Gross Profit | 56.4 | 107.3 | 133.4 | 149.8 | 51.8 | -65.4% |
| SG&A | | | | 61.2 | 90.8 | 48.4% |
| EBITDA | 48.8 | 87.9 | 100.6 | 114.3 | 3.9 | -96.6% |
| Net Income | 31.6 | 62.4 | 73.4 | 90.6 | -193.4 | -313.5% |
Balance Sheet
|
|---|
| Cash | 22.6 | 67.2 | 104.2 | 254.8 | 108.9 | -57.3% |
| Short Term Debt | 13.5 | 15.6 | 26.3 | 12.3 | 600.7 | 4,770.3% |
| Long Term Debt | 1.1 | 1.2 | 0.3 | 0.0 | 514.2 | |
Cash flow
|
|---|
| Capex | 14.4 | 14.4 | 36.3 | 36.5 | 46.9 | 28.4% |
Ratios
|
|---|
| Revenue growth | 21.8% | 42.7% | 36.7% | 14.6% | -4.7% | |
| EBITDA growth | 233.4% | 80.3% | 14.4% | 13.6% | -96.6% | |
| Gross Margin | 22.6% | 30.1% | 27.4% | 26.8% | 9.7% | -17.1% |
| EBITDA Margin | 19.5% | 24.7% | 20.7% | 20.5% | 0.7% | -19.7% |
| Net Income Margin | 12.7% | 17.5% | 15.1% | 16.2% | -36.3% | -52.6% |
| SG&A, % of revenue | | | | 11.0% | 17.1% | 6.1% |
| CAPEX, % of revenue | 5.8% | 4.0% | 7.5% | 6.5% | 8.8% | 2.3% |
| ROIC | 68.8% | 77.2% | 45.2% | 31.0% | -2.9% | -33.9% |
| ROE | 81.5% | 83.5% | 45.1% | 32.9% | -75.8% | -108.7% |
| Net Debt/EBITDA | -0.2x | -0.6x | -0.8x | -2.1x | 257.8x | 259.9x |
Revenue and profitability
Ngai Shun Holdings Ltd's Revenue decreased on 4.7%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 19.7 pp from 20.5% to 0.73% in FY2016.
Gross Margin dropped on 17.1 pp from 26.8% to 9.7% in FY2016. SG&A as a % of Revenue increased on 6.1 pp from 11.0% to 17.1% in FY2016.
Net Income marign dropped on 52.6 pp from 16.2% to -36.3% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Ngai Shun Holdings Ltd's CAPEX/Revenue was 8.8% in FY2016. Ngai Shun Holdings Ltd showed CAPEX/Revenue growth of 4.8 pp from 4.0% in FY2013 to 8.8% in FY2016. For the last three years the average CAPEX/Revenue was 7.6%.Battling declining revenue the company made large investments to CAPEX (1,202% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at negative ROIC (-2.88%) and ROE (-75.77%). ROIC dropped on 33.9 pp from 31.0% to -2.9% in FY2016. ROE dropped on 109 pp from 32.9% to -75.8% in FY2016.
Leverage (Debt)
Debt level is 257.8x Net Debt / EBITDA and 285.7x Debt / EBITDA. Net Debt / EBITDA surged on 259.9x from -2.1x to 257.8x in FY2016. Debt surged on 8,940% while cash dropped on 57.3%.
Appendix 1: Peers in Engineering&Construction
Below you can find Ngai Shun Holdings Ltd benchmarking vs. other companies in Engineering&Construction 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 |
|---|
| 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) | | 45.9% | -10.5% | 105.6% | 40.9% |
| Sino Credit Holdings Ltd ($628) | | | | 97.4% | -40.3% |
| Grand Ming Group Holdings Ltd ($1271) | | -26.9% | -37.4% | 74.8% | 14.3% |
| |
|---|
| Median (44 companies) | 15.1% | 24.0% | 20.8% | 10.3% | 2.7% |
|---|
| Ngai Shun Holdings Ltd ($1246) | | 42.7% | 36.7% | 14.6% | -4.7% |
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 (39 companies) | 16.4% | 16.0% | 15.4% | 15.6% | 12.0% |
|---|
| Ngai Shun Holdings Ltd ($1246) | 22.6% | 30.1% | 27.4% | 26.8% | 9.7% |
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 (44 companies) | 9.9% | 10.4% | 9.2% | 8.3% | 4.3% |
|---|
| Ngai Shun Holdings Ltd ($1246) | 19.5% | 24.7% | 20.7% | 20.5% | 0.7% |
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% | |
| NEW Concepts Holdings Ltd ($2221) | 1.7% | 1.2% | 3.1% | 20.5% | 0.3% |
| Louis XIII Holdings Ltd ($577) | 1.2% | 29.5% | 9.3% | 16.1% | 47.3% |
| |
|---|
| Median (44 companies) | 2.2% | 2.5% | 1.7% | 2.0% | 1.7% |
|---|
| Ngai Shun Holdings Ltd ($1246) | 5.8% | 4.0% | 7.5% | 6.5% | 8.8% |
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% | 21.6% |
| NEW Concepts Holdings Ltd ($2221) | | 51.0% | 78.8% | 39.0% | 23.3% |
| Sam Woo Construction Group Ltd ($3822) | | 28.2% | 28.7% | 33.5% | 18.3% |
| Broad Greenstate International Co Ltd ($1253) | 33.2% | 85.1% | 51.2% | 26.0% | |
| |
|---|
| Median (46 companies) | 5.8% | 5.9% | 4.4% | 5.5% | 2.6% |
|---|
| Ngai Shun Holdings Ltd ($1246) | 68.8% | 77.2% | 45.2% | 31.0% | -2.9% |
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 (38 companies) | 0.9x | 0.3x | 0.4x | 1.3x | -0.3x |
|---|
| Ngai Shun Holdings Ltd ($1246) | -0.2x | -0.6x | -0.8x | -2.1x | 257.8x |
