Galaxy Entertainment Group Ltd Net Income surged on 51.0% in 2016 and EBITDA Margin increased on 4.0 pp from 14.4% to 18.4%
28/02/2017 • About Galaxy Entertainment Group Ltd (
$27) • By InTwits
Galaxy Entertainment Group Ltd reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Galaxy Entertainment Group Ltd has medium CAPEX intensity: 5 year average CAPEX/Revenue was 8.3%. At the same time it's in pair with industry average of 3.3%.
- CAPEX is quite volatile: 2,099 in 2016, 6,541 in 2015, 9,475 in 2014, 5,123 in 2013, 2,227 in 2012
- The company has highly profitable business model: ROIC is at 12.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Galaxy Entertainment Group Ltd ($27) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 56,746 | 66,033 | 71,752 | 50,991 | 52,826 | 3.6% |
| EBITDA | 9,456 | 12,118 | 12,099 | 7,347 | 9,707 | 32.1% |
| Net Income | 7,378 | 10,052 | 10,340 | 4,161 | 6,283 | 51.0% |
Balance Sheet
|
|---|
| Cash | 8,907 | 9,028 | 8,331 | 7,979 | 19,641 | 146.2% |
| Short Term Debt | 4,966 | 406 | 412 | 719 | 5,609 | 680.2% |
| Long Term Debt | 6,291 | 237 | 576 | 671 | 526 | -21.7% |
Cash flow
|
|---|
| Capex | 2,227 | 5,123 | 9,475 | 6,541 | 2,099 | -67.9% |
Ratios
|
|---|
| Revenue growth | 37.8% | 16.4% | 8.7% | -28.9% | 3.6% | |
| EBITDA growth | 104.9% | 28.2% | -0.2% | -39.3% | 32.1% | |
| EBITDA Margin | 16.7% | 18.4% | 16.9% | 14.4% | 18.4% | 4.0% |
| Net Income Margin | 13.0% | 15.2% | 14.4% | 8.2% | 11.9% | 3.7% |
| CAPEX, % of revenue | 3.9% | 7.8% | 13.2% | 12.8% | 4.0% | -8.9% |
| ROIC | 25.2% | 30.0% | 27.5% | 10.2% | 12.7% | 2.5% |
| ROE | 40.9% | 37.0% | 29.2% | 10.5% | 14.4% | 3.9% |
| Net Debt/EBITDA | 0.2x | -0.7x | -0.6x | -0.9x | -1.4x | -0.5x |
Revenue and profitability
The company's Revenue increased on 3.6%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 8.2 pp from 11.9% to 20.1% in 2016.
Net Income marign increased on 3.7 pp from 8.2% to 11.9% in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 4.0% in 2016. CAPEX/Revenue decreased on 3.8 pp from 7.8% in 2013 to 4.0% in 2016. For the last three years the average CAPEX/Revenue was 10.0%.
Return on investment
The company operates at good ROIC (12.69%) and ROE (14.37%). ROIC increased on 2.5 pp from 10.2% to 12.7% in 2016. ROE increased on 3.9 pp from 10.5% to 14.4% in 2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.4x and Debt / EBITDA is 0.6x. Net Debt / EBITDA dropped on 0.5x from -0.9x to -1.4x in 2016. Debt jumped on 341% while cash jumped on 146%.
Appendix 1: Peers in Lodging
Below you can find Galaxy Entertainment Group 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) | 9.8% | 10.2% | 0.7% | -3.5% | -5.4% |
|---|
| Galaxy Entertainment Group Ltd ($27) | | 16.4% | 8.7% | -28.9% | 3.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| SJM Holdings Ltd ($880) | 99.7% | 99.7% | 99.7% | 99.5% | 99.4% |
| 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 (18 companies) | 56.4% | 51.1% | 51.7% | 48.6% | 63.7% |
|---|
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% | 27.7% |
|---|
| Galaxy Entertainment Group Ltd ($27) | 16.7% | 18.4% | 16.9% | 14.4% | 18.4% |
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% | 10.8% | 14.5% | 10.3% |
|---|
| Galaxy Entertainment Group Ltd ($27) | 3.9% | 7.8% | 13.2% | 12.8% | 4.0% |
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% | 14.3% |
| Emperor Entertainment Hotel Ltd ($296) | 22.2% | 21.1% | 18.4% | 12.0% | 7.5% |
| Wynn Macau Ltd ($1128) | 53.9% | 42.3% | 29.9% | 9.9% | |
| |
|---|
| Median (23 companies) | 5.7% | 5.6% | 3.6% | 2.7% | 6.5% |
|---|
| Galaxy Entertainment Group Ltd ($27) | 25.2% | 30.0% | 27.5% | 10.2% | 12.7% |
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) | 1.2x | 0.8x | 1.0x | 4.0x | 1.9x |
|---|
| Galaxy Entertainment Group Ltd ($27) | 0.2x | -0.7x | -0.6x | -0.9x | -1.4x |
