Kingwell Group Ltd Net Income dropped on 312% and Revenue decreased on 7.9%
28/09/2016 • About Kingwell Group Ltd (
$1195) • By InTwits
Kingwell Group Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Kingwell Group Ltd is a company in decline: FY2016 revenue growth was -7.9%, 5 years revenue CAGR was -52.4%
- The company operates at negative EBITDA Margin: -422.8%
- Kingwell Group Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 was 0.0%. On average EBITDA Margin was -61.3% for the sames years0
- Kingwell Group Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.2%. At the same time it's a lot of higher than industry average of 4.6%.
- CAPEX is quite volatile: 0 in FY2016, 2.0 in FY2015, 1.4 in FY2014, 8.7 in FY2013, 24.0 in FY2012
- The company has unprofitable business model: ROIC is at -10.9%
- It operates with high leverage: Net Debt/EBITDA is 6.1x while industry average is 1.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Kingwell Group Ltd ($1195) key annual financial indicators
| mln. CNY | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 280.0 | 160.2 | 27.1 | 9.4 | 8.7 | -7.9% |
| Gross Profit | 12.4 | 21.6 | 6.5 | 2.5 | 1.6 | -38.8% |
| SG&A | 72.5 | 47.3 | 52.2 | 54.1 | 28.8 | -46.8% |
| EBITDA | -114.2 | -60.6 | -37.7 | -48.4 | -36.7 | |
| Net Income | -204.6 | -105.7 | -101.1 | 20.9 | -44.4 | -312.2% |
Balance Sheet
|
|---|
| Cash | 147.3 | 193.2 | 184.6 | 37.1 | 38.8 | 4.6% |
| Short Term Debt | 103.6 | 209.0 | 134.5 | 17.6 | 0.0 | -100.0% |
| Long Term Debt | 72.0 | 34.1 | 23.1 | 23.0 | 0.5 | -97.8% |
Cash flow
|
|---|
| Capex | 24.0 | 8.7 | 1.4 | 2.0 | 0.0 | -100.0% |
Ratios
|
|---|
| Revenue growth | -21.0% | -42.8% | -83.1% | -65.3% | -7.9% | |
| EBITDA growth | 26.6% | -47.0% | -37.8% | 28.4% | -24.3% | |
| Gross Margin | 4.4% | 13.5% | 24.1% | 27.1% | 18.0% | -9.1% |
| EBITDA Margin | -40.8% | -37.8% | -139.1% | -514.2% | -422.8% | 91.4% |
| Net Income Margin | -73.1% | -66.0% | -373.3% | 222.3% | -512.1% | -734.4% |
| SG&A, % of revenue | 25.9% | 29.5% | 192.8% | 575.0% | 332.1% | -242.9% |
| CAPEX, % of revenue | 8.6% | 5.4% | 5.3% | 21.4% | 0.0% | -21.4% |
| ROIC | -21.9% | -15.2% | -9.8% | -12.3% | -10.9% | 1.4% |
| ROE | -110.1% | -162.0% | -108.1% | 10.6% | -17.4% | -28.0% |
Revenue and profitability
The company's Revenue decreased on 7.9%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin jumped on 91.4 pp from -514% to -423% in FY2016.
Gross Margin decreased on 9.1 pp from 27.1% to 18.0% in FY2016. SG&A as a % of Revenue dropped on 243 pp from 575% to 332% in FY2016.
Net Income marign dropped on 734 pp from 222% to -512% in FY2016.
Return on investment
The company operates at negative ROIC (-10.92%) and ROE (-17.38%). ROIC increased slightly on 1.4 pp from -12.3% to -10.9% in FY2016. ROE dropped on 28.0 pp from 10.6% to -17.4% in FY2016.
Leverage (Debt)
Debt level is 6.1x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt dropped on 98.8% while cash increased on 4.6%.
Appendix 1: Peers in Electronics
Below we provide Kingwell Group Ltd benchmarking against other companies in Electronics 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 |
|---|
| GCL New Energy Holdings Ltd ($451) | 14.7% | -6.8% | 10.9% | 53.9% | |
| Tech Pro Technology Development Ltd ($3823) | 7.4% | -44.9% | -13.7% | 52.4% | |
| Nanjing Sample Technology Co Ltd ($1708) | 36.1% | 8.0% | 15.4% | 34.8% | |
| AAC Technologies Holdings Inc ($2018) | 54.8% | 28.9% | 9.7% | 32.2% | |
| Ningbo Wanhao Holdings Co Ltd ($8249) | 5.7% | 412.4% | -6.9% | 28.9% | |
| |
|---|
| Median (49 companies) | 4.3% | 4.1% | 7.2% | 0.9% | -0.9% |
|---|
| Kingwell Group Ltd ($1195) | | -42.8% | -83.1% | -65.3% | -7.9% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Advanced Card Systems Holdings Ltd ($8210) | 54.0% | 58.1% | 49.5% | 49.6% | |
| AAC Technologies Holdings Inc ($2018) | 44.2% | 42.7% | 41.4% | 41.5% | |
| TeleEye Holdings Ltd ($8051) | 44.0% | 42.1% | 38.5% | 37.0% | |
| Hi Sun Technology China Ltd ($818) | 28.1% | 37.4% | 33.3% | 34.7% | |
| Datronix Holdings Ltd ($889) | 32.9% | 32.0% | 34.1% | 34.6% | |
| |
|---|
| Median (47 companies) | 14.1% | 13.8% | 13.9% | 14.1% | 13.4% |
|---|
| Kingwell Group Ltd ($1195) | 4.4% | 13.5% | 24.1% | 27.1% | 18.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| AAC Technologies Holdings Inc ($2018) | 35.8% | 35.8% | 34.9% | 34.8% | |
| GCL New Energy Holdings Ltd ($451) | 10.8% | 11.1% | 12.6% | 33.0% | |
| Daiwa Associate Holdings ($1037) | 2.4% | 3.8% | 2.8% | 25.6% | -53.6% |
| Wasion Group Holdings Ltd ($3393) | 18.8% | 21.2% | 22.0% | 19.3% | |
| Tongda Group Holdings Ltd ($698) | 17.1% | 16.8% | 18.4% | 18.9% | |
| |
|---|
| Median (49 companies) | 7.4% | 7.6% | 5.4% | 5.5% | 0.7% |
|---|
| Kingwell Group Ltd ($1195) | -40.8% | -37.8% | -139.1% | -514.2% | -422.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| GCL New Energy Holdings Ltd ($451) | 5.5% | 5.1% | 5.4% | 401.2% | |
| National Electronic Hldgs ($213) | 3.4% | 18.1% | 7.1% | 49.7% | 4.7% |
| Irico Group Electronics Co Ltd ($438) | 39.9% | 30.4% | 17.4% | 25.8% | |
| AAC Technologies Holdings Inc ($2018) | 18.7% | 8.7% | 19.6% | 18.4% | |
| AKM Industrial Co Ltd ($1639) | 5.0% | 17.4% | 25.2% | 18.0% | |
| |
|---|
| Median (49 companies) | 3.7% | 3.0% | 3.7% | 2.9% | 2.1% |
|---|
| Kingwell Group Ltd ($1195) | 8.6% | 5.4% | 5.3% | 21.4% | 0.0% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| AAC Technologies Holdings Inc ($2018) | 29.1% | 30.0% | 26.0% | 27.8% | |
| Cowell e Holdings Inc ($1415) | 12.5% | 27.1% | 24.4% | 25.8% | |
| Changhong Jiahua Holdings Ltd ($8016) | 29.6% | 17.7% | 15.1% | 16.7% | |
| Tongda Group Holdings Ltd ($698) | 15.2% | 13.5% | 16.5% | 16.3% | |
| Alltronics Holdings Ltd ($833) | 13.1% | 15.2% | 19.8% | 15.6% | |
| |
|---|
| Median (49 companies) | 4.6% | 4.1% | 3.7% | 2.6% | 0.2% |
|---|
| Kingwell Group Ltd ($1195) | -21.9% | -15.2% | -9.8% | -12.3% | -10.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| National Electronic Hldgs ($213) | 16.3x | 30.2x | 84.8x | 19.9x | 42.7x |
| GCL New Energy Holdings Ltd ($451) | 2.9x | 2.6x | 1.7x | 17.4x | |
| Man Yue Technology Holdings Ltd ($894) | 2.1x | 2.7x | 3.3x | 6.5x | |
| Willas-Array Electronics Holdings Ltd ($854) | 2.2x | 2.6x | 5.7x | 5.4x | 14.1x |
| SAS Dragon Hldg Ltd ($1184) | 7.1x | 2.0x | 6.4x | 4.8x | |
| |
|---|
| Median (33 companies) | 1.0x | 1.1x | 0.8x | 0.2x | 1.2x |
|---|
