CLP Holdings Ltd reports 18.5% Net Income decline and 5.2 pp EBITDA Margin decline from 35.7% to 30.5%
27/02/2017 • About CLP Holdings Ltd (
$2) • By InTwits
CLP Holdings Ltd reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- CLP Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 10.5%. At the same time it's a lot of higher than industry average of 4.9%.
- CAPEX is quite volatile: 1,432 in 2016, 1,594 in 2015, 1,879 in 2014, 3,298 in 2013, 4,912 in 2012
- The company has business model with average profitability: ROIC is at 10.1%
- It operates with high leverage: Net Debt/EBITDA is 1.9x while industry average is -0.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
CLP Holdings Ltd ($2) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 104,861 | 104,530 | 92,259 | 80,700 | 79,434 | -1.6% |
| EBITDA | 20,172 | 16,425 | 21,812 | 28,840 | 24,240 | -16.0% |
| Net Income | 8,312 | 6,060 | 11,373 | 15,903 | 12,958 | -18.5% |
Balance Sheet
|
|---|
| Cash | 13,026 | 5,233 | 4,393 | 3,799 | 4,467 | 17.6% |
| Short Term Debt | 9,301 | 9,881 | 9,637 | 13,189 | 10,651 | -19.2% |
| Long Term Debt | 83,952 | 74,146 | 57,825 | 42,294 | 40,995 | -3.1% |
Cash flow
|
|---|
| Capex | 9,056 | 8,462 | 9,192 | 10,871 | 9,756 | -10.3% |
Ratios
|
|---|
| Revenue growth | 14.4% | -0.3% | -11.7% | -12.5% | -1.6% | |
| EBITDA growth | 3.4% | -18.6% | 32.8% | 32.2% | -16.0% | |
| EBITDA Margin | 19.2% | 15.7% | 23.6% | 35.7% | 30.5% | -5.2% |
| Net Income Margin | 7.9% | 5.8% | 12.3% | 19.7% | 16.3% | -3.4% |
| CAPEX, % of revenue | 8.6% | 8.1% | 10.0% | 13.5% | 12.3% | -1.2% |
| ROIC | 7.0% | 4.8% | 8.5% | 12.8% | 10.1% | -2.7% |
| ROE | 9.6% | 6.8% | 12.8% | 17.3% | 13.3% | -4.0% |
| Net Debt/EBITDA | 4.0x | 4.8x | 2.9x | 1.8x | 1.9x | 0.2x |
Revenue and profitability
The company's Revenue decreased slightly on 1.6%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.2 pp from 3.1% to 4.2% in 2016.
Net Income marign decreased on 3.4 pp from 19.7% to 16.3% in 2016.
Capital expenditures (CAPEX) and working capital investments
CLP Holdings Ltd's CAPEX/Revenue was 12.3% in 2016. CAPEX/Revenue increased on 4.2 pp from 8.1% in 2013 to 12.3% in 2016. It's average level of CAPEX/Revenue for the last three years was 11.9%.
Return on investment
The company operates at good ROE (13.30%) while ROIC is low (10.12%). ROIC decreased on 2.7 pp from 12.8% to 10.1% in 2016. ROE decreased on 4.0 pp from 17.3% to 13.3% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 1.9x and Debt / EBITDA is 2.1x. Net Debt / EBITDA jumped on 0.2x from 1.8x to 1.9x in 2016. Debt decreased on 6.9% while cash jumped on 17.6%.
Valuation
The company's trades at EV/EBITDA 10.3x and P/E 15.6x while industy averages are 17.8x and 21.9x. The company's EV/(EBITDA-CAPEX) is 17.2x with the industry average at 22.8x.
Management team
The company's CEO Richard Kendall Lancaster has spent 5 years at the company. CLP Holdings Ltd's CFO Geert Herman August Peeters has spent 4 years at the company.
Appendix 1: Peers in Electric
Below you can find CLP Holdings Ltd benchmarking vs. other companies in Electric 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 |
|---|
| Huaneng Renewables Corp Ltd ($958) | 26.0% | 46.7% | 4.1% | 19.6% | |
| CGN Power Co Ltd ($1816) | 10.7% | -1.2% | 19.3% | 12.3% | |
| Huadian Fuxin Energy Corp Ltd ($816) | 56.0% | 16.7% | 4.9% | 10.4% | |
| China Datang Corp Renewable Power Co Ltd ($1798) | 14.1% | 28.9% | -7.9% | 7.8% | |
| HK Electric Investments & HK Electric Investments Ltd ($2638) | 2.1% | -1.8% | 2.9% | 6.7% | |
| |
|---|
| Median (15 companies) | 8.8% | 11.8% | 7.2% | -1.2% | |
|---|
| CLP Holdings Ltd ($2) | | -0.3% | -11.7% | -12.5% | -1.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Power Assets Holdings Ltd ($6) | 60.0% | 63.5% | 85.6% | 99.4% | |
| China Power New Energy Development Co Ltd ($735) | 73.3% | 70.8% | 72.0% | 74.9% | |
| HK Electric Investments & HK Electric Investments Ltd ($2638) | 60.1% | 58.6% | 54.0% | 53.7% | |
| CGN Power Co Ltd ($1816) | 46.5% | 46.9% | 48.6% | 47.9% | |
| Tianjin Development Hldgs Ltd ($882) | 8.5% | 5.0% | 18.7% | 18.6% | |
| |
|---|
| Median (6 companies) | 46.5% | 52.8% | 48.6% | 50.8% | |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Huaneng Renewables Corp Ltd ($958) | 94.0% | 80.5% | 91.3% | 93.1% | |
| China Datang Corp Renewable Power Co Ltd ($1798) | 90.5% | 82.8% | 87.0% | 82.4% | |
| HK Electric Investments & HK Electric Investments Ltd ($2638) | 72.6% | 77.6% | 73.3% | 71.7% | |
| Power Assets Holdings Ltd ($6) | 66.2% | 68.0% | 2,533.1% | 71.2% | |
| CGN Power Co Ltd ($1816) | 66.0% | 62.6% | 60.5% | 59.4% | |
| |
|---|
| Median (15 companies) | 32.1% | 39.0% | 42.3% | 52.1% | |
|---|
| CLP Holdings Ltd ($2) | 19.2% | 15.7% | 23.6% | 35.7% | 30.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Enerchina Holdings Ltd ($622) | 24.1% | 28.3% | 3.8% | 321.6% | |
| Huaneng Renewables Corp Ltd ($958) | 163.4% | 124.0% | 217.8% | 171.9% | |
| China Power New Energy Development Co Ltd ($735) | 82.2% | 80.1% | 119.5% | 99.0% | |
| Huadian Fuxin Energy Corp Ltd ($816) | 62.2% | 54.3% | 91.8% | 96.0% | |
| China Datang Corp Renewable Power Co Ltd ($1798) | 157.1% | 81.7% | 106.3% | 93.4% | |
| |
|---|
| Median (15 companies) | 31.9% | 30.9% | 18.9% | 21.3% | |
|---|
| CLP Holdings Ltd ($2) | 8.6% | 8.1% | 10.0% | 13.5% | 12.3% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Resources Power Holdings Co Ltd ($836) | 7.7% | 9.7% | 8.0% | 11.0% | |
| China Power International Development Ltd ($2380) | 5.7% | 7.5% | 8.0% | 10.1% | |
| Huadian Power International Corp Ltd ($1071) | 5.0% | 8.4% | 10.4% | 10.0% | |
| Amber Energy Ltd ($90) | 5.4% | 4.6% | 3.6% | 8.6% | |
| Huadian Fuxin Energy Corp Ltd ($816) | 7.5% | 8.1% | 7.7% | 6.2% | |
| |
|---|
| Median (15 companies) | 5.0% | 6.1% | 6.0% | 5.1% | |
|---|
| CLP Holdings Ltd ($2) | 7.0% | 4.8% | 8.5% | 12.8% | 10.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| CGN Meiya Power Holdings Co Ltd ($1811) | 9.1x | 8.1x | 4.3x | 8.6x | |
| China Datang Corp Renewable Power Co Ltd ($1798) | 9.1x | 8.2x | 8.7x | 8.5x | |
| CGN Power Co Ltd ($1816) | 6.5x | 6.7x | 7.8x | 8.4x | |
| China Power New Energy Development Co Ltd ($735) | 4.8x | 5.5x | 6.4x | 7.9x | |
| Huadian Fuxin Energy Corp Ltd ($816) | 6.9x | 6.2x | 6.5x | 7.4x | |
| |
|---|
| Median (13 companies) | 6.2x | 5.8x | 5.5x | 5.2x | |
|---|
| CLP Holdings Ltd ($2) | 4.0x | 4.8x | 2.9x | 1.8x | 1.9x |
