Great Eagle Holdings Ltd Net Income dropped on 16.4% in 2016 while EBITDA Margin increased on 3.5 pp from 36.9% to 40.4%
28/02/2017 • About Great Eagle Holdings Ltd (
$41) • By InTwits
Great Eagle Holdings 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 2.8%
- It operates with high leverage: Net Debt/EBITDA is 6.4x while industry average is 3.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Great Eagle Holdings Ltd ($41) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 6,747 | 7,301 | 8,127 | 8,271 | 8,649 | 4.6% |
| Gross Profit | 3,078 | 3,251 | 3,488 | 3,461 | 3,903 | 12.8% |
| SG&A | 255 | 341 | 571 | 413 | | -100.0% |
| EBITDA | 2,822 | 2,909 | 2,917 | 3,051 | 3,492 | 14.4% |
| Net Income | 3,552 | 2,399 | 2,115 | 3,312 | 2,770 | -16.4% |
Balance Sheet
|
|---|
| Cash | 4,962 | 10,712 | 5,628 | 5,164 | 5,858 | 13.4% |
| Short Term Debt | 6,381 | 7,042 | 3,231 | 9,968 | 2,495 | -75.0% |
| Long Term Debt | 10,372 | 19,347 | 24,682 | 17,192 | 25,694 | 49.5% |
Cash flow
|
|---|
| Capex | 1,328 | 6,356 | 1,110 | 3,109 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 42.1% | 8.2% | 11.3% | 1.8% | 4.6% | |
| EBITDA growth | 110.7% | 3.1% | 0.3% | 4.6% | 14.4% | |
| Gross Margin | 45.6% | 44.5% | 42.9% | 41.8% | 45.1% | 3.3% |
| EBITDA Margin | 41.8% | 39.8% | 35.9% | 36.9% | 40.4% | 3.5% |
| Net Income Margin | 52.6% | 32.9% | 26.0% | 40.0% | 32.0% | -8.0% |
| SG&A, % of revenue | 3.8% | 4.7% | 7.0% | 5.0% | | -5.0% |
| CAPEX, % of revenue | 19.7% | 87.1% | 13.7% | 37.6% | | -37.6% |
| ROIC | 4.2% | 2.9% | 2.5% | 2.4% | 2.8% | 0.4% |
| ROE | 9.3% | 5.2% | 4.2% | 6.2% | 5.0% | -1.2% |
| Net Debt/EBITDA | 4.2x | 5.4x | 7.6x | 7.2x | 6.4x | -0.8x |
Revenue and profitability
The company's Revenue increased on 4.6%. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 3.5 pp from 36.9% to 40.4% in FY2016.
Gross Margin increased on 3.3 pp from 41.8% to 45.1% in FY2016.
Net Income marign decreased on 8.0 pp from 40.0% to 32.0% in FY2016.
Return on investment
The company operates at low ROIC (2.84%) and ROE (5.03%). ROIC showed almost no change in FY2016. ROE decreased slightly on 1.2 pp from 6.2% to 5.0% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 6.4x and Debt / EBITDA is 8.1x. Net Debt / EBITDA dropped on 0.8x from 7.2x to 6.4x in FY2016. Debt increased on 3.8% while cash surged on 13.4%.
Appendix 1: Peers in Real Estate
Below we provide Great Eagle Holdings 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) | 15.9% | 13.5% | 5.2% | 4.5% | 7.5% |
|---|
| Great Eagle Holdings Ltd ($41) | | 8.2% | 11.3% | 1.8% | 4.6% |
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% | 46.0% |
|---|
| Great Eagle Holdings Ltd ($41) | 45.6% | 44.5% | 42.9% | 41.8% | 45.1% |
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% | 28.3% | 26.9% | 23.4% | 28.4% |
|---|
| Great Eagle Holdings Ltd ($41) | 41.8% | 39.8% | 35.9% | 36.9% | 40.4% |
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) | 5.6% | 6.1% | 4.7% | 3.2% | 3.8% |
|---|
| Great Eagle Holdings Ltd ($41) | 19.7% | 87.1% | 13.7% | 37.6% | |
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) | 4.0% | 4.1% | 4.2% | 2.5% | 2.0% |
|---|
| Great Eagle Holdings Ltd ($41) | 4.2% | 2.9% | 2.5% | 2.4% | 2.8% |
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) | 2.3x | 2.7x | 3.0x | 3.2x | 2.3x |
|---|
| Great Eagle Holdings Ltd ($41) | 4.2x | 5.4x | 7.6x | 7.2x | 6.4x |
