International Housewares Retail Co Ltd reports 8.8% EBITDA decline in 2016 while 4.5% Revenue growth
25/07/2016 • About International Housewares Retail Co Ltd (
$1373) • By InTwits
International Housewares Retail Co Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- International Housewares Retail Co Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.6%. At the same time it's in pair with industry average of 6.7%.
- CAPEX is quite volatile: 26.2 in FY2016, 76.9 in FY2015, 35.3 in FY2014, 44.3 in FY2013, 32.1 in FY2012
- The company has business model with average profitability: ROIC is at 10.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
International Housewares Retail Co Ltd ($1373) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,211 | 1,499 | 1,747 | 1,951 | 2,040 | 4.5% |
| Gross Profit | 538 | 690 | 813 | 903 | 948 | 5.0% |
| SG&A | 453 | 583 | 708 | 822 | 883 | 7.4% |
| EBITDA | 119 | 144 | 149 | 130 | 119 | -8.8% |
| Net Income | 85 | 102 | 144 | 88 | 66 | -24.8% |
Balance Sheet
|
|---|
| Cash | 71 | 112 | 466 | 447 | 177 | -60.3% |
| Short Term Debt | 51 | 63 | 67 | 76 | 47 | -37.2% |
| Long Term Debt | 0 | 3 | 0 | 3 | 0 | -100.0% |
Cash flow
|
|---|
| Capex | 32 | 44 | 35 | 77 | 26 | -65.9% |
Ratios
|
|---|
| Revenue growth | 19.0% | 23.7% | 16.6% | 11.7% | 4.5% | |
| EBITDA growth | 31.9% | 21.4% | 3.7% | -12.6% | -8.8% | |
| Gross Margin | 44.5% | 46.1% | 46.5% | 46.3% | 46.5% | 0.2% |
| EBITDA Margin | 9.8% | 9.6% | 8.5% | 6.7% | 5.8% | -0.8% |
| Net Income Margin | 7.1% | 6.8% | 8.3% | 4.5% | 3.3% | -1.3% |
| SG&A, % of revenue | 37.4% | 38.9% | 40.5% | 42.1% | 43.3% | 1.2% |
| CAPEX, % of revenue | 2.7% | 3.0% | 2.0% | 3.9% | 1.3% | -2.7% |
| ROIC | 44.7% | 38.4% | 20.3% | 11.8% | 10.9% | -0.9% |
| ROE | 58.0% | 47.9% | 30.1% | 12.5% | 9.4% | -3.1% |
| Net Debt/EBITDA | -0.2x | -0.3x | -2.7x | -2.8x | -1.1x | 1.7x |
Revenue and profitability
International Housewares Retail Co Ltd's Revenue increased on 4.5%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 4.4 pp from -3.2% to -7.6% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue increased slightly on 1.2 pp from 42.1% to 43.3% in FY2016.
Net Income marign decreased slightly on 1.3 pp from 4.5% to 3.3% in FY2016.
Capital expenditures (CAPEX) and working capital investments
In FY2016 International Housewares Retail Co Ltd had CAPEX/Revenue of 1.3%. International Housewares Retail Co Ltd's CAPEX/Revenue decreased slightly on 1.7 pp from 3.0% in FY2013 to 1.3% in FY2016. It's average CAPEX/Revenue for the last three years was 2.4%.
Return on investment
The company operates at low ROIC (10.86%) and ROE (9.39%). ROIC decreased slightly on 0.93 pp from 11.8% to 10.9% in FY2016. ROE decreased on 3.1 pp from 12.5% to 9.4% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.1x and Debt / EBITDA is 0.4x. Net Debt / EBITDA surged on 1.7x from -2.8x to -1.1x in FY2016. Debt dropped on 39.3% while cash dropped on 60.3%.
Appendix 1: Peers in Housewares
Below you can find International Housewares Retail Co Ltd benchmarking vs. other companies in Housewares 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 |
|---|
| World Houseware Holdings Ltd ($713) | -4.8% | -7.4% | -0.4% | 0.2% | |
| China Creative Home Group Ltd ($1678) | 20.5% | 23.4% | 17.9% | -9.0% | |
| Perfectech International Holdings Ltd ($765) | -21.9% | -3.5% | -9.3% | -12.2% | |
| Bolina Holding Co Ltd ($1190) | 24.6% | 11.8% | -5.2% | -17.3% | |
| China Strategic Holdings Ltd ($235) | -39.2% | 1,832.6% | 281.4% | -42.7% | |
| |
|---|
| Median (5 companies) | -4.8% | 11.8% | -0.4% | -12.2% | |
|---|
| International Housewares Retail Co Ltd ($1373) | | 23.7% | 16.6% | 11.7% | 4.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Bolina Holding Co Ltd ($1190) | 47.7% | 46.8% | 43.5% | 39.9% | |
| China Creative Home Group Ltd ($1678) | 44.2% | 44.3% | 40.4% | 36.9% | |
| Perfectech International Holdings Ltd ($765) | 23.9% | 26.6% | 25.1% | 22.7% | |
| World Houseware Holdings Ltd ($713) | 13.1% | 10.3% | 10.8% | 14.6% | |
| China Strategic Holdings Ltd ($235) | 11.4% | 11.7% | 7.4% | 14.0% | |
| |
|---|
| Median (5 companies) | 23.9% | 26.6% | 25.1% | 22.7% | |
|---|
| International Housewares Retail Co Ltd ($1373) | 44.5% | 46.1% | 46.5% | 46.3% | 46.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Creative Home Group Ltd ($1678) | 36.0% | 33.8% | 32.6% | 28.5% | |
| Bolina Holding Co Ltd ($1190) | 37.8% | 34.0% | 28.7% | 20.4% | |
| Perfectech International Holdings Ltd ($765) | 14.6% | 14.9% | 11.7% | 4.6% | |
| World Houseware Holdings Ltd ($713) | 7.1% | 3.4% | 2.4% | 4.2% | |
| China Strategic Holdings Ltd ($235) | -1,603.6% | -25.0% | -2.8% | -7.3% | |
| |
|---|
| Median (5 companies) | 14.6% | 14.9% | 11.7% | 4.6% | |
|---|
| International Housewares Retail Co Ltd ($1373) | 9.8% | 9.6% | 8.5% | 6.7% | 5.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Creative Home Group Ltd ($1678) | 1.2% | 2.4% | 42.0% | 13.1% | |
| World Houseware Holdings Ltd ($713) | 3.6% | 6.2% | 12.4% | 5.1% | |
| Perfectech International Holdings Ltd ($765) | 2.3% | 16.2% | 19.8% | 2.9% | |
| China Strategic Holdings Ltd ($235) | 0.0% | 0.0% | 0.6% | 0.7% | |
| Bolina Holding Co Ltd ($1190) | 5.2% | 4.4% | 1.8% | 0.6% | |
| |
|---|
| Median (5 companies) | 2.3% | 4.4% | 12.4% | 2.9% | |
|---|
| International Housewares Retail Co Ltd ($1373) | 2.7% | 3.0% | 2.0% | 3.9% | 1.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Creative Home Group Ltd ($1678) | 38.8% | 28.1% | 23.6% | 15.3% | |
| Bolina Holding Co Ltd ($1190) | 38.8% | 24.7% | 16.8% | 8.5% | |
| Perfectech International Holdings Ltd ($765) | 11.7% | 11.8% | 7.6% | 0.5% | |
| China Strategic Holdings Ltd ($235) | -12.0% | -4.0% | -1.3% | -0.8% | |
| World Houseware Holdings Ltd ($713) | 1.6% | -1.9% | -2.8% | -1.8% | |
| |
|---|
| Median (5 companies) | 11.7% | 11.8% | 7.6% | 0.5% | |
|---|
| International Housewares Retail Co Ltd ($1373) | 44.7% | 38.4% | 20.3% | 11.8% | 10.9% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| World Houseware Holdings Ltd ($713) | 1.4x | 4.7x | 11.7x | 7.4x | |
| China Creative Home Group Ltd ($1678) | -0.4x | -2.3x | -1.4x | -1.8x | |
| Bolina Holding Co Ltd ($1190) | -1.7x | -1.1x | -1.9x | -2.4x | |
| Perfectech International Holdings Ltd ($765) | -1.8x | -1.7x | -0.7x | -4.4x | |
| |
|---|
| Median (4 companies) | -1.0x | -1.4x | -1.1x | -2.1x | |
|---|
| International Housewares Retail Co Ltd ($1373) | -0.2x | -0.3x | -2.7x | -2.8x | -1.1x |
