Solartech International Hldgs Ltd revenue decreased on 5.3% while EBITDA Margin increased on 3.8 pp from -10.1% to -6.3%
29/09/2016 • About Solartech International Hldgs Ltd (
$1166) • By InTwits
Solartech International Hldgs Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Solartech International Hldgs Ltd doesn't have a profitable business model yet: FY2016 ROIC is -4.0%
- The company operates at negative EBITDA Margin: -6.3%
- Solartech International Hldgs Ltd spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 is 0.0%. Average EBITDA Margin for the same period was -8.3%0
- Solartech International Hldgs Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.7%. At the same time it's a lot of higher than industry average of 7.8%.
- CAPEX is quite volatile: 27.6 in FY2016, 30.8 in FY2015, 35.5 in FY2014, 15.9 in FY2013, 84.6 in FY2012
- The company has unprofitable business model: ROIC is at -4.0%
- It operates with high leverage: Net Debt/EBITDA is 13.9x while industry average is -19.8x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Solartech International Hldgs Ltd ($1166) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 612.9 | 601.6 | 804.3 | 782.2 | 741.0 | -5.3% |
| Gross Profit | 7.5 | 14.2 | 18.9 | 35.7 | 49.7 | 39.0% |
| SG&A | | 93.6 | 101.0 | 132.1 | 150.0 | 13.5% |
| EBITDA | -65.5 | -56.6 | -46.6 | -79.1 | -46.8 | |
| Net Income | -106.1 | -415.1 | -37.7 | -370.3 | -274.9 | |
Balance Sheet
|
|---|
| Cash | 191.7 | 142.3 | 268.5 | 162.5 | 199.2 | 22.6% |
| Short Term Debt | 249.0 | 257.3 | 232.7 | 67.7 | 116.3 | 71.7% |
| Long Term Debt | 0.3 | 0.1 | 0.0 | 0.0 | 96.9 | |
Cash flow
|
|---|
| Capex | 84.6 | 15.9 | 35.5 | 30.8 | 27.6 | -10.2% |
Ratios
|
|---|
| Revenue growth | -13.4% | -1.8% | 33.7% | -2.7% | -5.3% | |
| EBITDA growth | 48.2% | -13.6% | -17.7% | 69.6% | -40.9% | |
| Gross Margin | 1.2% | 2.4% | 2.3% | 4.6% | 6.7% | 2.1% |
| EBITDA Margin | -10.7% | -9.4% | -5.8% | -10.1% | -6.3% | 3.8% |
| Net Income Margin | -17.3% | -69.0% | -4.7% | -47.3% | -37.1% | 10.2% |
| SG&A, % of revenue | | 15.6% | 12.6% | 16.9% | 20.2% | 3.3% |
| CAPEX, % of revenue | 13.8% | 2.6% | 4.4% | 3.9% | 3.7% | -0.2% |
| ROIC | -4.7% | -4.3% | -4.2% | -5.9% | -4.0% | 1.9% |
| ROE | -5.7% | -24.5% | -2.4% | -23.1% | -18.7% | 4.5% |
Revenue and profitability
The company's Revenue decreased on 5.3%. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 3.8 pp from -10.1% to -6.3% in FY2016.
Gross Margin increased on 2.1 pp from 4.6% to 6.7% in FY2016. SG&A as a % of Revenue increased on 3.3 pp from 16.9% to 20.2% in FY2016.
Net Income marign surged on 10.2 pp from -47.3% to -37.1% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Solartech International Hldgs Ltd's CAPEX/Revenue was 3.7% in FY2016. Solartech International Hldgs Ltd showed small growth in CAPEX/Revenue of 1.1 pp from 2.6% in FY2013 to 3.7% in FY2016. It's average level of CAPEX/Revenue for the last three years was 4.0%.
Return on investment
The company operates at negative ROIC (-4.02%) and ROE (-18.66%). ROIC increased slightly on 1.9 pp from -5.9% to -4.0% in FY2016. ROE increased on 4.5 pp from -23.1% to -18.7% in FY2016.
Leverage (Debt)
Debt level is 13.9x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt surged on 215% while cash surged on 22.6%.
Appendix 1: Peers in Electrical Compo&Equip
Below we provide Solartech International Hldgs Ltd benchmarking against other companies in Electrical Compo&Equip 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 |
|---|
| Applied Development Holdings Ltd ($519) | | | | 850.5% | 187.4% |
| Jimei International Entertainment Group Ltd ($1159) | 100.6% | 652.0% | -31.2% | 273.5% | |
| FDG Electric Vehicles Ltd ($729) | | -7.0% | 54.0% | 270.8% | 19.7% |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | -12.0% | 8.7% | 44.1% | 69.8% | |
| Sun King Power Electronics Group ($580) | -6.0% | 29.0% | -30.1% | 51.2% | |
| |
|---|
| Median (33 companies) | 0.2% | 8.9% | 15.5% | 6.1% | 12.2% |
|---|
| Solartech International Hldgs Ltd ($1166) | | -1.8% | 33.7% | -2.7% | -5.3% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Titans Energy Technology Group Co Ltd ($2188) | 41.4% | 27.3% | 33.7% | 36.6% | |
| Boer Power Holdings Ltd ($1685) | 36.8% | 36.0% | 35.3% | 35.7% | |
| Sun King Power Electronics Group ($580) | 25.4% | 30.0% | 30.8% | 34.1% | |
| China High Speed Transmission Equipment Group Co Ltd ($658) | 24.4% | 24.9% | 24.8% | 32.5% | |
| CEC International Holdings Ltd ($759) | 23.6% | 27.9% | 29.9% | 31.8% | 33.4% |
| |
|---|
| Median (31 companies) | 19.6% | 17.9% | 16.6% | 17.8% | 33.4% |
|---|
| Solartech International Hldgs Ltd ($1166) | 1.2% | 2.4% | 2.3% | 4.6% | 6.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Shougang Concord Technology Holdings ($521) | 12.3% | 28.1% | 31.9% | 45.8% | |
| Boer Power Holdings Ltd ($1685) | 26.3% | 27.8% | 28.5% | 28.6% | |
| China High Speed Transmission Equipment Group Co Ltd ($658) | 20.2% | 19.2% | 20.8% | 26.3% | |
| China Titans Energy Technology Group Co Ltd ($2188) | 10.8% | -11.9% | 2.0% | 16.5% | |
| Sun King Power Electronics Group ($580) | 8.4% | 13.8% | 2.2% | 15.8% | |
| |
|---|
| Median (33 companies) | 8.3% | 7.3% | 5.5% | 6.6% | 7.9% |
|---|
| Solartech International Hldgs Ltd ($1166) | -10.7% | -9.4% | -5.8% | -10.1% | -6.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| FDG Electric Vehicles Ltd ($729) | 374.3% | 82.3% | 71.1% | 417.0% | 311.5% |
| Applied Development Holdings Ltd ($519) | 79.7% | | 1,285.3% | 89.8% | 683.8% |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | 23.1% | 50.7% | 13.5% | 22.8% | |
| Jimei International Entertainment Group Ltd ($1159) | 0.1% | 15.2% | 0.6% | 7.3% | |
| CEC International Holdings Ltd ($759) | 8.8% | 10.1% | 4.3% | 6.9% | 2.8% |
| |
|---|
| Median (33 companies) | 6.4% | 5.4% | 3.6% | 2.6% | 159.9% |
|---|
| Solartech International Hldgs Ltd ($1166) | 13.8% | 2.6% | 4.4% | 3.9% | 3.7% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Boer Power Holdings Ltd ($1685) | 18.0% | 17.0% | 21.2% | 19.5% | |
| Tianneng Power International Ltd ($819) | 20.0% | 4.5% | -3.6% | 14.9% | |
| Jiangnan Group Ltd ($1366) | 14.9% | 14.1% | 13.5% | 12.8% | |
| Xinjiang Goldwind Science & Technology Co Ltd ($2208) | 1.8% | 3.0% | 10.4% | 12.0% | |
| Johnson Electric Holdings Ltd ($179) | 11.7% | 11.6% | 12.7% | 11.2% | 7.4% |
| |
|---|
| Median (33 companies) | 2.8% | 3.0% | 2.8% | 3.2% | 0.8% |
|---|
| Solartech International Hldgs Ltd ($1166) | -4.7% | -4.3% | -4.2% | -5.9% | -4.0% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Wai Chi Holdings Co Ltd ($1305) | 3.4x | 3.1x | 2.0x | 11.8x | |
| Coslight Technology International Group Co Ltd ($1043) | 51.9x | 8.7x | 54.7x | 7.7x | |
| Guodian Technology & Environment Group Corp Ltd ($1296) | 6.3x | 7.6x | 6.8x | 6.9x | |
| Leoch International Technology Ltd ($842) | 9.3x | 16.3x | 4.7x | 5.0x | |
| CEC International Holdings Ltd ($759) | 3.9x | 6.1x | 4.1x | 4.9x | 6.0x |
| |
|---|
| Median (26 companies) | 1.5x | 1.4x | 2.2x | 1.0x | 0.8x |
|---|
