Melco Crown Entertainment Ltd reports 60.9% EBITDA growth and 13.7% Revenue growth
16/02/2017 • About Melco Crown Entertainment Ltd (
$6883) • By InTwits
Melco Crown Entertainment Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts: The company has potentially unprofitable business model: ROIC is at 4.2%.
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Melco Crown Entertainment Ltd ($6883) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 4,078 | 5,087 | 4,802 | 3,975 | 4,519 | 13.7% |
| Gross Profit | 1,138 | 1,529 | 1,458 | 1,176 | 1,406 | 19.5% |
| SG&A | 227 | 256 | 312 | 384 | 447 | 16.3% |
| EBITDA | 889 | 1,223 | 1,054 | 569 | 915 | 60.9% |
| Net Income | 417 | 637 | 608 | 106 | 176 | 66.3% |
Balance Sheet
|
|---|
| Cash | 1,709 | 2,009 | 1,708 | 2,336 | 1,913 | -18.1% |
| Short Term Debt | 855 | 290 | 286 | 136 | 81 | -40.3% |
| Long Term Debt | 2,340 | 2,524 | 3,918 | 4,127 | 3,932 | -4.7% |
Cash flow
|
|---|
| Capex | 228 | 123 | 337 | 277 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 6.5% | 24.7% | -5.6% | -17.2% | 13.7% | |
| EBITDA growth | 11.4% | 37.7% | -13.9% | -46.0% | 60.9% | |
| Gross Margin | 27.9% | 30.0% | 30.4% | 29.6% | 31.1% | 1.5% |
| EBITDA Margin | 21.8% | 24.0% | 21.9% | 14.3% | 20.3% | 5.9% |
| Net Income Margin | 10.2% | 12.5% | 12.7% | 2.7% | 3.9% | 1.2% |
| SG&A, % of revenue | 5.6% | 5.0% | 6.5% | 9.7% | 9.9% | 0.2% |
| CAPEX, % of revenue | 5.6% | 2.4% | 7.0% | 7.0% | | -7.0% |
| ROIC | 7.9% | 11.1% | 7.9% | 1.0% | 4.2% | 3.1% |
| ROE | 13.2% | 16.7% | 14.3% | 2.5% | 4.6% | 2.1% |
| Net Debt/EBITDA | 1.7x | 0.7x | 2.4x | 3.4x | 2.3x | -1.1x |
Revenue and profitability
Melco Crown Entertainment Ltd's Revenue jumped on 13.7%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 5.9 pp from 14.3% to 20.3% in FY2016.
Gross Margin increased slightly on 1.5 pp from 29.6% to 31.1% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased slightly on 1.2 pp from 2.7% to 3.9% in FY2016.
Return on investment
The company operates at low ROIC (4.18%) and ROE (4.58%). ROIC increased on 3.1 pp from 1.0% to 4.2% in FY2016. ROE increased on 2.1 pp from 2.5% to 4.6% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.3x and Debt / EBITDA is 4.4x. Net Debt / EBITDA dropped on 1.1x from 3.4x to 2.3x in FY2016. Debt decreased on 5.9% while cash dropped on 18.1%.
Management team
The company's CEO is Ho Yau Lung "Lawrence". Ho Yau Lung "Lawrence" has 14 years tenure at the company. Geoffrey Stuart Davis is a The company's CFO. Geoffrey Stuart Davis has spent 8 years at the company.
Appendix 1: Peers in Lodging
Below you can find Melco Crown Entertainment Ltd benchmarking vs. other companies in Lodging 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 New City Commercial Development Ltd ($1321) | -16.9% | 433.0% | -76.2% | 141.3% | |
| Zhuhai Holdings Investment Group Ltd ($908) | 229.8% | 14.5% | 57.0% | 76.3% | |
| Shanghai Jin Jiang International Hotels Group Co Ltd ($2006) | -28.8% | 3.2% | 0.8% | 29.9% | |
| Century City International Holdings Ltd ($355) | 283.6% | 108.7% | -35.8% | 25.9% | |
| Far East Consortium International Ltd/HK ($35) | | 111.9% | 9.0% | 25.7% | -21.8% |
| |
|---|
| Median (23 companies) | 10.7% | 10.2% | 0.8% | -3.5% | -7.5% |
|---|
| Melco Crown Entertainment Ltd ($6883) | | 24.7% | -5.6% | -17.2% | 13.7% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SJM Holdings Ltd ($880) | 99.7% | 99.7% | 99.7% | 99.5% | |
| Wynn Macau Ltd ($1128) | 97.9% | 98.3% | 98.5% | 98.4% | |
| Emperor Entertainment Hotel Ltd ($296) | 77.1% | 75.6% | 76.8% | 70.9% | 65.5% |
| Asia Standard Hotel Group Ltd ($292) | 60.7% | 73.4% | 72.1% | 67.6% | 65.8% |
| Sino Hotels Holdings Ltd ($1221) | 71.3% | 70.4% | 68.9% | 65.8% | 62.0% |
| |
|---|
| Median (17 companies) | 57.2% | 55.9% | 52.0% | 51.8% | 63.7% |
|---|
| Melco Crown Entertainment Ltd ($6883) | 27.9% | 30.0% | 30.4% | 29.6% | 31.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| NagaCorp Ltd ($3918) | 49.8% | 50.1% | 42.8% | 45.3% | 48.1% |
| Emperor Entertainment Hotel Ltd ($296) | 44.9% | 46.4% | 46.9% | 43.1% | 36.2% |
| Jinmao Investments and Jinmao China Investments Holdings Ltd ($6139) | 41.2% | 40.5% | 25.8% | 41.5% | |
| Asia Standard Hotel Group Ltd ($292) | -23.9% | 65.2% | 49.9% | 40.4% | 17.8% |
| Sino Hotels Holdings Ltd ($1221) | 46.5% | 45.9% | 43.1% | 39.6% | 33.1% |
| |
|---|
| Median (23 companies) | 26.8% | 26.4% | 25.8% | 23.8% | 33.1% |
|---|
| Melco Crown Entertainment Ltd ($6883) | 21.8% | 24.0% | 21.9% | 14.3% | 20.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Macau Legend Development Ltd ($1680) | 5.0% | 24.2% | 73.0% | 68.5% | |
| Wynn Macau Ltd ($1128) | 5.2% | 11.0% | 28.2% | 66.6% | |
| Legend Strategy International Holdings Group Co Ltd ($1355) | 17.0% | 38.0% | 1.2% | 62.6% | |
| Century City International Holdings Ltd ($355) | 21.2% | 32.9% | 13.4% | 35.8% | |
| Shangri-La Asia Ltd ($69) | 48.5% | 33.1% | 41.2% | 34.3% | |
| |
|---|
| Median (23 companies) | 7.4% | 11.0% | 13.2% | 14.5% | 10.3% |
|---|
| Melco Crown Entertainment Ltd ($6883) | 5.6% | 2.4% | 7.0% | 7.0% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| NagaCorp Ltd ($3918) | 30.6% | 28.9% | 22.6% | 28.6% | 21.3% |
| MGM China Holdings Ltd ($2282) | 46.2% | 53.8% | 54.5% | 24.0% | 16.0% |
| Sands China Ltd ($1928) | 14.2% | 24.4% | 26.7% | 15.8% | |
| Emperor Entertainment Hotel Ltd ($296) | 22.2% | 21.1% | 18.4% | 12.0% | 7.5% |
| Galaxy Entertainment Group Ltd ($27) | 25.2% | 30.0% | 27.5% | 10.2% | |
| |
|---|
| Median (23 companies) | 5.7% | 5.6% | 3.6% | 3.9% | 5.5% |
|---|
| Melco Crown Entertainment Ltd ($6883) | 7.9% | 11.1% | 7.9% | 1.0% | 4.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China New City Commercial Development Ltd ($1321) | 26.0x | 7.9x | | 100.1x | |
| Century City International Holdings Ltd ($355) | 6.5x | 9.3x | 11.2x | 12.3x | |
| Regal Hotels International Holdings Ltd ($78) | 5.0x | 8.7x | 11.8x | 11.1x | |
| Shangri-La Asia Ltd ($69) | 6.0x | 6.8x | 6.9x | 9.8x | |
| Macau Legend Development Ltd ($1680) | 2.2x | 0.6x | 0.2x | 7.1x | |
| |
|---|
| Median (21 companies) | 0.5x | 0.8x | 0.5x | 4.0x | 2.9x |
|---|
| Melco Crown Entertainment Ltd ($6883) | 1.7x | 0.7x | 2.4x | 3.4x | 2.3x |
