Agritrade Resources Ltd reports 221% Net Income growth in 2016 while 6.6% Revenue decline
07/07/2016 • About Agritrade Resources Ltd (
$1131) • By InTwits
Agritrade Resources Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Agritrade Resources Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 32.1%. At the same time it's in pair with industry average of 40.3%.
- CAPEX is quite volatile: 439 in FY2016, 321 in FY2015, 272 in FY2014, 97.0 in FY2013, 231 in FY2012
- The company has business model with low profitability: ROIC is at 9.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Agritrade Resources Ltd ($1131) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 427 | 701 | 961 | 1,234 | 1,152 | -6.6% |
| Gross Profit | 98 | 206 | 306 | 370 | 356 | -4.0% |
| SG&A | | | | 136 | 228 | 67.5% |
| EBITDA | 178 | 261 | 321 | 384 | 649 | 69.2% |
| Net Income | -18 | 53 | 115 | 147 | 471 | 220.6% |
Balance Sheet
|
|---|
| Cash | 22 | 16 | 171 | 265 | 296 | 11.6% |
| Short Term Debt | 67 | 157 | 149 | 253 | 278 | 9.8% |
| Long Term Debt | 291 | 230 | 205 | 165 | 550 | 233.6% |
Cash flow
|
|---|
| Capex | 231 | 97 | 272 | 321 | 439 | 37.0% |
Ratios
|
|---|
| Revenue growth | 97.2% | 64.1% | 37.2% | 28.4% | -6.6% | |
| EBITDA growth | 5,652.4% | 46.8% | 22.9% | 19.5% | 69.2% | |
| Gross Margin | 22.9% | 29.4% | 31.8% | 30.0% | 30.9% | 0.9% |
| EBITDA Margin | 41.6% | 37.3% | 33.4% | 31.1% | 56.3% | 25.2% |
| Net Income Margin | -4.1% | 7.6% | 12.0% | 11.9% | 40.8% | 29.0% |
| SG&A, % of revenue | | | | 11.1% | 19.8% | 8.8% |
| CAPEX, % of revenue | 54.1% | 13.8% | 28.3% | 26.0% | 38.1% | 12.1% |
| ROIC | 2.7% | 5.8% | 6.4% | 6.9% | 9.4% | 2.5% |
| ROE | -1.7% | 5.2% | 9.5% | 9.9% | 22.4% | 12.5% |
| Net Debt/EBITDA | 1.9x | 1.4x | 0.6x | 0.4x | 0.8x | 0.4x |
Revenue and profitability
Agritrade Resources Ltd's Revenue decreased on 6.6%. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin jumped on 25.2 pp from 31.1% to 56.3% in FY2016.
Gross Margin increased slightly on 0.86 pp from 30.0% to 30.9% in FY2016. SG&A as a % of Revenue increased on 8.8 pp from 11.1% to 19.8% in FY2016.
Net Income marign jumped on 29.0 pp from 11.9% to 40.8% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Agritrade Resources Ltd's CAPEX/Revenue was 38.1% in FY2016. The company showed fast CAPEX/Revenue growth of 24.3 pp from 13.8% in FY2013 to 38.1% in FY2016. It's average CAPEX/Revenue for the last three years was 30.8%.Battling declining revenue Agritrade Resources Ltd invested a large share of EBITDA (67.7%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at good ROE (22.36%) while ROIC is low (9.41%). ROIC increased on 2.5 pp from 6.9% to 9.4% in FY2016. ROE surged on 12.5 pp from 9.9% to 22.4% in FY2016.
Leverage (Debt)
Debt level is 0.8x Net Debt / EBITDA and 1.3x Debt / EBITDA. Net Debt / EBITDA jumped on 0.4x from 0.4x to 0.8x in FY2016. Debt jumped on 98.1% while cash surged on 11.6%.
Appendix 1: Peers in Coal
Below we provide Agritrade Resources Ltd benchmarking against other companies in Coal 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 |
|---|
| Sino Resources Group Ltd ($223) | | -44.8% | 14.7% | 354.5% | 0.4% |
| Asia Coal Ltd ($835) | | -15.3% | 43.2% | 133.6% | -60.1% |
| Dowell Property Holdings Ltd ($668) | -19.2% | -55.7% | -35.8% | 83.2% | |
| Capital Finance Holdings Ltd ($8239) | 83.6% | -5.2% | -5.5% | 70.6% | |
| Up Energy Development Group Ltd ($307) | | | | 60.5% | |
| |
|---|
| Median (21 companies) | -10.8% | -9.4% | -14.2% | -22.9% | -51.9% |
|---|
| Agritrade Resources Ltd ($1131) | | 64.1% | 37.2% | 28.4% | -6.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital Finance Holdings Ltd ($8239) | 6.4% | 7.2% | 8.7% | 98.2% | |
| Nan Nan Resources Enterprise Ltd ($1229) | 23.9% | 17.6% | 18.1% | 44.3% | 41.0% |
| Shougang Fushan Resources Group Ltd ($639) | 63.5% | 50.9% | 40.1% | 24.5% | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 35.2% | 33.7% | 27.4% | 19.2% | |
| Yanzhou Coal Mining Co Ltd ($1171) | 21.7% | 18.9% | 18.4% | 16.9% | |
| |
|---|
| Median (20 companies) | 19.8% | 15.6% | 8.7% | 2.9% | 7.1% |
|---|
| Agritrade Resources Ltd ($1131) | 22.9% | 29.4% | 31.8% | 30.0% | 30.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital Finance Holdings Ltd ($8239) | -27.2% | -23.7% | -56.2% | 71.5% | |
| Nan Nan Resources Enterprise Ltd ($1229) | 19.1% | 14.1% | -0.2% | 40.5% | 24.1% |
| Feishang Anthracite Resources Ltd ($1738) | -13.1% | -32.9% | 19.0% | 15.9% | |
| Kinetic Mines and Energy Ltd ($1277) | -277.0% | -51.9% | 29.3% | 15.8% | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 33.1% | 30.7% | 22.8% | 15.0% | |
| |
|---|
| Median (21 companies) | -3.8% | -7.8% | -11.6% | -18.0% | -20.9% |
|---|
| Agritrade Resources Ltd ($1131) | 41.6% | 37.3% | 33.4% | 31.1% | 56.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Siberian Mining Group Co Ltd ($1142) | 4.6% | 78.8% | 217.3% | 279.7% | |
| Feishang Anthracite Resources Ltd ($1738) | 244.9% | 159.7% | 80.9% | 90.2% | |
| Up Energy Development Group Ltd ($307) | | | 279.5% | 75.2% | |
| King Stone Energy Group Ltd ($663) | 58.5% | 135.3% | 205.7% | 69.3% | |
| SouthGobi Resources Ltd ($1878) | 124.8% | 20.2% | 11.5% | 52.6% | |
| |
|---|
| Median (20 companies) | 12.5% | 26.3% | 18.3% | 15.8% | 3.7% |
|---|
| Agritrade Resources Ltd ($1131) | 54.1% | 13.8% | 28.3% | 26.0% | 38.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital Finance Holdings Ltd ($8239) | -25.1% | -14.9% | -26.9% | 21.0% | |
| Nan Nan Resources Enterprise Ltd ($1229) | 6.4% | 1.6% | -1.2% | 10.0% | 1.5% |
| Kinetic Mines and Energy Ltd ($1277) | -6.6% | -5.7% | 8.5% | 3.2% | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 28.5% | 15.2% | 8.5% | 2.0% | |
| Yanzhou Coal Mining Co Ltd ($1171) | 5.3% | 2.0% | 3.7% | 0.6% | |
| |
|---|
| Median (21 companies) | -3.2% | -3.8% | -5.7% | -5.7% | -18.5% |
|---|
| Agritrade Resources Ltd ($1131) | 2.7% | 5.8% | 6.4% | 6.9% | 9.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Feishang Anthracite Resources Ltd ($1738) | | | 24.3x | 32.6x | |
| China Coal Energy Co Ltd ($1898) | 1.9x | 4.9x | 9.7x | 14.4x | |
| Inner Mongolia Yitai Coal Co Ltd ($3948) | 0.4x | 1.7x | 3.5x | 9.8x | |
| Yanzhou Coal Mining Co Ltd ($1171) | 2.9x | 6.2x | 4.9x | 9.0x | |
| Kinetic Mines and Energy Ltd ($1277) | | | 4.5x | 5.9x | |
| |
|---|
| Median (7 companies) | 4.4x | 4.9x | 4.9x | 9.0x | -1.8x |
|---|
| Agritrade Resources Ltd ($1131) | 1.9x | 1.4x | 0.6x | 0.4x | 0.8x |
