Vanke Property Overseas Ltd reports 18.8% Net Income decline in 2016 while 2.4% Revenue growth
21/02/2017 • About Vanke Property Overseas Ltd (
$1036) • By InTwits
Vanke Property Overseas 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 2.1%.
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Vanke Property Overseas Ltd ($1036) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 77.574 | 82.550 | 85.809 | 89.067 | 91.244 | 2.4% |
| Gross Profit | 59.929 | 62.903 | 66.025 | 68.908 | 70.076 | 1.7% |
| SG&A | 17.770 | | | 12.660 | 13.528 | 6.9% |
| EBITDA | 43.922 | | 55.177 | 56.483 | 59.451 | 5.3% |
| Net Income | 506.193 | 151.506 | 137.555 | 161.705 | 131.320 | -18.8% |
Balance Sheet
|
|---|
| Cash | 50.151 | 20.708 | 11.986 | 715.728 | 728.922 | 1.8% |
| Short Term Debt | 0.000 | 155.500 | 330.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 510.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.717 | 0.014 | 0.000 | 0.466 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 16.9% | 6.4% | 3.9% | 3.8% | 2.4% | |
| EBITDA growth | -7.0% | | | 2.4% | 5.3% | |
| Gross Margin | 77.3% | 76.2% | 76.9% | 77.4% | 76.8% | -0.6% |
| EBITDA Margin | 56.6% | 0.0% | 64.3% | 63.4% | 65.2% | 1.7% |
| Net Income Margin | 652.5% | 183.5% | 160.3% | 181.6% | 143.9% | -37.6% |
| SG&A, % of revenue | 22.9% | | | 14.2% | 14.8% | 0.6% |
| CAPEX, % of revenue | 0.9% | 0.0% | 0.0% | 0.5% | | -0.5% |
| ROIC | 0.6% | 2.8% | 2.7% | 2.4% | 2.1% | -0.3% |
| ROE | 8.0% | 11.2% | 9.2% | 7.5% | 4.7% | -2.8% |
| Net Debt/EBITDA | -1.1x | | 5.8x | -12.7x | -12.3x | 0.4x |
Revenue and profitability
The company's Revenue increased on 2.4%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 24.1 pp from -18.3% to 5.7% in FY2016.
Gross Margin decreased slightly on 0.57 pp from 77.4% to 76.8% in FY2016. SG&A as a % of Revenue increased slightly on 0.61 pp from 14.2% to 14.8% in FY2016.
Net Income marign dropped on 37.6 pp from 182% to 144% in FY2016.
Return on investment
The company operates at low ROIC (2.10%) and ROE (4.69%). ROIC showed almost no change in FY2016. ROE decreased on 2.8 pp from 7.5% to 4.7% in FY2016.
Leverage (Debt)
The company has no debt. Cash increased slightly on 1.8%.
Appendix 1: Peers in Real Estate
Below we provide Vanke Property Overseas Ltd benchmarking against other companies in Real Estate 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 |
|---|
| Guangdong Land Holdings Ltd ($124) | | | | 24,971.2% | |
| GR Properties Ltd ($108) | 21.6% | -82.9% | 14.6% | 1,203.6% | |
| Wanda Hotel Development Co Ltd ($169) | | -51.4% | -86.2% | 1,071.2% | |
| Henderson Investment Ltd ($97) | -78.9% | | | 737.1% | |
| ITC Properties Group Ltd ($199) | | -95.2% | 75.7% | 678.6% | 206.4% |
| |
|---|
| Median (179 companies) | 16.9% | 13.5% | 5.3% | 4.5% | 6.7% |
|---|
| Vanke Property Overseas Ltd ($1036) | | 6.4% | 3.9% | 3.8% | 2.4% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renhe Commercial Holdings Co Ltd ($1387) | 79.0% | 95.2% | 97.9% | 99.9% | |
| Tern Properties Co Ltd ($277) | 96.7% | 98.4% | 98.4% | 98.7% | 98.8% |
| YT Realty Group Ltd ($75) | 94.4% | 96.6% | 96.7% | 97.6% | |
| Wah Ha Realty Co Ltd ($278) | 96.3% | 96.0% | 93.2% | 95.9% | 92.9% |
| Soundwill Holdings Ltd ($878) | 53.1% | 74.5% | 46.9% | 95.7% | |
| |
|---|
| Median (160 companies) | 41.9% | 41.8% | 39.1% | 38.2% | 50.7% |
|---|
| Vanke Property Overseas Ltd ($1036) | 77.3% | 76.2% | 76.9% | 77.4% | 76.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Chinese Estates Holdings Ltd ($127) | 356.2% | 91.6% | 195.5% | 397.4% | |
| Zall Development Group Ltd ($2098) | 105.3% | 133.1% | 143.2% | 213.9% | |
| SOHO China Ltd ($410) | 113.6% | 80.8% | 104.0% | 201.9% | |
| Beijing Properties Holdings Ltd ($925) | -606.3% | 2,162.6% | 224.3% | 186.5% | |
| Swire Properties Ltd ($1972) | 154.5% | 114.6% | 73.2% | 100.3% | |
| |
|---|
| Median (179 companies) | 28.9% | 28.4% | 26.9% | 23.4% | 31.2% |
|---|
| Vanke Property Overseas Ltd ($1036) | 56.6% | | 64.3% | 63.4% | 65.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| LT Commercial Real Estate Ltd ($112) | 0.0% | 18.0% | 27,965.5% | 4,834.8% | |
| China Oceanwide Holdings Ltd ($715) | 0.8% | 0.3% | 2.0% | 880.6% | |
| Madex International Holdings Ltd ($231) | 174.5% | 519.7% | 205.3% | 350.6% | |
| Pacific Century Premium Developments Ltd ($432) | 2.9% | 323.1% | 351.2% | 340.6% | 570.7% |
| Hon Kwok Land Investment Co Ltd ($160) | 20.6% | 157.3% | 144.5% | 296.3% | 28.1% |
| |
|---|
| Median (179 companies) | 5.9% | 6.2% | 4.8% | 3.3% | 4.0% |
|---|
| Vanke Property Overseas Ltd ($1036) | 0.9% | 0.0% | 0.0% | 0.5% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hydoo International Holding Ltd ($1396) | 44.3% | 62.0% | 12.9% | 16.6% | |
| Gemdale Properties & Investment Corp Ltd ($535) | 15.3% | 19.6% | 10.8% | 15.9% | |
| China Overseas Land & Investment Ltd ($688) | | 15.1% | 18.5% | 15.4% | 13.0% |
| Colour Life Services Group Co Ltd ($1778) | 44.2% | 47.9% | 29.3% | 14.5% | |
| Dalian Wanda Commercial Properties Co Ltd ($3699) | 26.8% | 19.6% | 12.3% | 14.4% | |
| |
|---|
| Median (181 companies) | 4.2% | 4.1% | 4.2% | 2.5% | 1.7% |
|---|
| Vanke Property Overseas Ltd ($1036) | 0.6% | 2.8% | 2.7% | 2.4% | 2.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Shui On Land Ltd ($272) | 22.1x | 13.2x | 17.1x | 54.2x | |
| Beijing Capital Land Ltd ($2868) | 7.1x | 4.6x | 11.7x | 49.1x | 37.0x |
| Talent Property Group Ltd ($760) | | | | 43.0x | |
| Mingfa Group International Co Ltd ($846) | 2.5x | 3.0x | 6.3x | 42.9x | |
| Sunshine 100 China Holdings Ltd ($2608) | 9.9x | 12.4x | 12.9x | 42.3x | |
| |
|---|
| Median (136 companies) | 2.4x | 2.7x | 3.0x | 3.3x | 2.2x |
|---|
| Vanke Property Overseas Ltd ($1036) | -1.1x | | 5.8x | -12.7x | -12.3x |
