Bossini International Hldg reports 153% Net Income growth in 2016 while 1.4 pp EBITDA Margin decline from 7.1% to 5.6%
21/09/2016 • About Bossini International Hldg (
$592) • By InTwits
Bossini International Hldg reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Bossini International Hldg is a company in decline: FY2016 revenue growth was -8.1%, 5 years revenue CAGR was -2.6%
- Bossini International Hldg has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.4%. At the same time it's a lot of higher than industry average of 38.3%.
- CAPEX is quite volatile: 70.1 in FY2016, 34.4 in FY2015, 119 in FY2014, 25.5 in FY2013, 20.9 in FY2012
- The company has business model with low profitability: ROIC is at 7.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Bossini International Hldg ($592) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 2,744 | 2,517 | 2,548 | 2,523 | 2,319 | -8.1% |
| Gross Profit | 1,294 | 1,199 | 1,301 | 1,264 | 1,107 | -12.4% |
| SG&A | | 1,123 | 1,110 | 1,119 | 1,059 | -5.3% |
| EBITDA | 130 | 116 | 223 | 178 | 130 | -26.9% |
| Net Income | 16 | 22 | 127 | 115 | 292 | 153.2% |
Balance Sheet
|
|---|
| Cash | 273 | 338 | 452 | 475 | 511 | 7.6% |
| Short Term Debt | 59 | 50 | 46 | 36 | 31 | -15.4% |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 72 | 60 | 53 | 62 | 55 | -12.1% |
Ratios
|
|---|
| Revenue growth | 3.9% | -8.3% | 1.2% | -1.0% | -8.1% | |
| EBITDA growth | -41.7% | -10.4% | 92.0% | -20.1% | -26.9% | |
| Gross Margin | 47.2% | 47.7% | 51.1% | 50.1% | 47.7% | -2.4% |
| EBITDA Margin | 4.7% | 4.6% | 8.8% | 7.1% | 5.6% | -1.4% |
| Net Income Margin | 0.6% | 0.9% | 5.0% | 4.6% | 12.6% | 8.0% |
| SG&A, % of revenue | | 44.6% | 43.6% | 44.3% | 45.7% | 1.3% |
| CAPEX, % of revenue | 2.6% | 2.4% | 2.1% | 2.5% | 2.4% | -0.1% |
| ROIC | 5.0% | 5.5% | 18.9% | 14.3% | 7.8% | -6.6% |
| ROE | 2.1% | 3.1% | 16.6% | 14.4% | 32.6% | 18.2% |
| Net Debt/EBITDA | -1.6x | -2.5x | -1.8x | -2.5x | -3.7x | -1.2x |
Revenue and profitability
Bossini International Hldg's Revenue decreased on 8.1%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased slightly on 1.4 pp from 7.1% to 5.6% in FY2016.
Gross Margin decreased on 2.4 pp from 50.1% to 47.7% in FY2016. SG&A as a % of Revenue increased slightly on 1.3 pp from 44.3% to 45.7% in FY2016.
Net Income marign increased on 8.0 pp from 4.6% to 12.6% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 2.4% in FY2016. CAPEX/Revenue showed almost no change from FY2013 to FY2016. It's average level of CAPEX/Revenue for the last three years was 2.3%.
Return on investment
The company operates at good ROE (32.57%) while ROIC is low (7.76%). ROIC decreased on 6.6 pp from 14.3% to 7.8% in FY2016. ROE surged on 18.2 pp from 14.4% to 32.6% in FY2016.
Leverage (Debt)
Debt level is -3.7x Net Debt / EBITDA and 0.2x Debt / EBITDA. Net Debt / EBITDA dropped on 1.2x from -2.5x to -3.7x in FY2016. Debt dropped on 15.4% while cash increased on 7.6%.
Appendix 1: Peers in Retail
Below you can find Bossini International Hldg benchmarking vs. other companies in Retail 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 |
|---|
| China Nuclear Industry 23 International Corp Ltd ($611) | 1.4% | 85.6% | -42.1% | 419.8% | |
| Noble House China Holdings Ltd ($8246) | -5.0% | -20.2% | -24.8% | 117.2% | |
| Vongroup Ltd ($318) | | 23.7% | -80.2% | 90.3% | -7.2% |
| Nanjing Sinolife United Co Ltd ($3332) | 45.6% | 29.5% | 29.6% | 57.3% | |
| Shanghai La Chapelle Fashion Co Ltd ($6116) | 54.9% | 72.8% | 23.0% | 48.3% | |
| |
|---|
| Median (117 companies) | 7.5% | 6.5% | 3.1% | -1.0% | -8.4% |
|---|
| Bossini International Hldg ($592) | | -8.3% | 1.2% | -1.0% | -8.1% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Vongroup Ltd ($318) | | | 95.1% | 99.1% | 99.0% |
| Modern Beauty Salon Holdings Ltd ($919) | 97.4% | 95.9% | 96.8% | 96.7% | 96.8% |
| Moiselle International Holdings Ltd ($130) | 81.2% | 83.8% | 80.6% | 83.2% | 77.6% |
| Embry Holdings Ltd ($1388) | 81.2% | 80.4% | 82.3% | 81.6% | |
| Nanjing Sinolife United Co Ltd ($3332) | 86.5% | 89.3% | 90.9% | 80.6% | |
| |
|---|
| Median (103 companies) | 36.2% | 35.8% | 35.0% | 33.3% | 44.4% |
|---|
| Bossini International Hldg ($592) | 47.2% | 47.7% | 51.1% | 50.1% | 47.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Energy Development Holdings Ltd ($228) | -58.1% | -72.3% | -84.0% | 1,070.6% | |
| Golden Eagle Retail Group Ltd ($3308) | 48.5% | 47.3% | 42.8% | 55.4% | |
| Nanjing Sinolife United Co Ltd ($3332) | 51.6% | 56.9% | 54.4% | 44.8% | |
| Lifestyle International Holdings Ltd ($1212) | 47.5% | 47.0% | 44.7% | 43.4% | |
| China Dongxiang Group Co Ltd ($3818) | 6.0% | 5.6% | 58.3% | 41.4% | |
| |
|---|
| Median (117 companies) | 10.8% | 7.8% | 9.1% | 7.4% | 4.7% |
|---|
| Bossini International Hldg ($592) | 4.7% | 4.6% | 8.8% | 7.1% | 5.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Culture Landmark Investment Ltd ($674) | 11.6% | 19.4% | 15.7% | 47.2% | 3.9% |
| Springland International Holdings Ltd ($1700) | 31.9% | 17.4% | 26.5% | 36.9% | |
| Merry Garden Holdings Ltd ($1237) | 18.6% | 28.6% | 15.1% | 34.2% | |
| China Energy Development Holdings Ltd ($228) | 1.6% | 0.2% | 0.0% | 27.4% | |
| Golden Eagle Retail Group Ltd ($3308) | 28.5% | 9.4% | 26.7% | 25.4% | |
| |
|---|
| Median (117 companies) | 4.1% | 3.6% | 3.8% | 3.5% | 1.8% |
|---|
| Bossini International Hldg ($592) | 2.6% | 2.4% | 2.1% | 2.5% | 2.4% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Modern Beauty Salon Holdings Ltd ($919) | 50.7% | -4.6% | 81.3% | 71.8% | 13.3% |
| JC Group Holdings Ltd ($8326) | | 215.6% | 92.8% | 66.3% | 81.7% |
| Starbucks Corp ($4337) | 36.4% | -6.0% | 52.8% | 51.4% | |
| Sa Sa International Holdings Ltd ($178) | 53.5% | 52.7% | 49.0% | 39.8% | 19.0% |
| Noble House China Holdings Ltd ($8246) | 17.7% | -67.7% | -113.8% | 35.6% | |
| |
|---|
| Median (117 companies) | 12.3% | 8.9% | 8.5% | 5.8% | 0.8% |
|---|
| Bossini International Hldg ($592) | 5.0% | 5.5% | 18.9% | 14.3% | 7.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sparkle Roll Group Ltd ($970) | 0.6x | 4.0x | 9.3x | 23.5x | 8.5x |
| Trinity Ltd ($891) | -0.2x | 0.2x | 0.6x | 18.2x | |
| Parkson Retail Group Ltd ($3368) | 0.8x | 2.3x | 3.6x | 9.8x | |
| Maoye International Holdings Ltd ($848) | 2.9x | 3.3x | 3.4x | 9.0x | |
| Century Ginwa Retail Holdings Ltd ($162) | 2.0x | 2.5x | 4.8x | 7.3x | |
| |
|---|
| Median (91 companies) | -0.5x | -0.5x | -0.2x | -0.5x | -0.6x |
|---|
| Bossini International Hldg ($592) | -1.6x | -2.5x | -1.8x | -2.5x | -3.7x |
