Lee & Man Paper Manufacturing Ltd Net Income jumped on 22.8% in 2016 and EBITDA Margin increased on 2.1 pp from 21.6% to 23.7%
28/02/2017 • About Lee & Man Paper Manufacturing Ltd (
$2314) • By InTwits
Lee & Man Paper Manufacturing Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is expanding: 23.7% in FY2016 vs. 21.6% in FY2015 vs. 14.6% in FY2012
- The company has business model with average profitability: ROIC is at 10.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Lee & Man Paper Manufacturing Ltd ($2314) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 14,716 | 16,970 | 17,099 | 17,616 | 18,342 | 4.1% |
| Gross Profit | 2,063 | 2,886 | 3,072 | 3,578 | 4,081 | 14.0% |
| SG&A | 842 | 934 | 1,039 | 1,114 | 1,127 | 1.2% |
| EBITDA | 2,151 | 2,918 | 3,196 | 3,803 | 4,349 | 14.3% |
| Net Income | 1,351 | 1,948 | 1,904 | 2,332 | 2,863 | 22.8% |
Balance Sheet
|
|---|
| Cash | 731 | 711 | 2,033 | 2,969 | 1,276 | -57.0% |
| Short Term Debt | 2,896 | 5,661 | 6,698 | 5,250 | 4,240 | -19.2% |
| Long Term Debt | 6,664 | 5,298 | 6,163 | 9,012 | 9,307 | 3.3% |
Cash flow
|
|---|
| Capex | 2,902 | 2,322 | 2,232 | 3,016 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 4.9% | 15.3% | 0.8% | 3.0% | 4.1% | |
| EBITDA growth | -20.7% | 35.7% | 9.5% | 19.0% | 14.3% | |
| Gross Margin | 14.0% | 17.0% | 18.0% | 20.3% | 22.2% | 1.9% |
| EBITDA Margin | 14.6% | 17.2% | 18.7% | 21.6% | 23.7% | 2.1% |
| Net Income Margin | 9.2% | 11.5% | 11.1% | 13.2% | 15.6% | 2.4% |
| SG&A, % of revenue | 5.7% | 5.5% | 6.1% | 6.3% | 6.1% | -0.2% |
| CAPEX, % of revenue | 19.7% | 13.7% | 13.1% | 17.1% | | -17.1% |
| ROIC | 7.2% | 8.7% | 8.0% | 9.2% | 10.6% | 1.4% |
| ROE | 10.5% | 13.1% | 11.3% | 13.4% | 16.8% | 3.4% |
| Net Debt/EBITDA | 4.1x | 3.5x | 3.4x | 3.0x | 2.8x | -0.1x |
Revenue and profitability
Lee & Man Paper Manufacturing Ltd's Revenue increased on 4.1%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.1 pp from 15.7% to 14.5% in FY2016.
Gross Margin increased slightly on 1.9 pp from 20.3% to 22.2% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased on 2.4 pp from 13.2% to 15.6% in FY2016.
Return on investment
The company operates at good ROE (16.81%) while ROIC is low (10.64%). ROIC increased slightly on 1.4 pp from 9.2% to 10.6% in FY2016. ROE increased on 3.4 pp from 13.4% to 16.8% in FY2016.
Leverage (Debt)
Debt level is 2.8x Net Debt / EBITDA and 3.1x Debt / EBITDA. Net Debt / EBITDA dropped on 0.1x from 3.0x to 2.8x in FY2016. Debt decreased on 5.0% while cash dropped on 57.0%.
Management team
Lee & Man Paper Manufacturing Ltd's CEO is Lee Man Bun. Lee Man Bun has 5 years tenure at the company.
Appendix 1: Peers in Packaging&Containers
Below you can find Lee & Man Paper Manufacturing Ltd benchmarking vs. other companies in Packaging&Containers 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 |
|---|
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 34.9% | 17.5% | -6.5% | 69.5% | |
| Hao Tian Development Group Ltd ($474) | | | | 51.0% | 113.4% |
| Jin Cai Holdings Co Ltd ($1250) | 2.1% | -6.3% | -3.1% | 40.8% | |
| Huaxi Holdings Co Ltd ($1689) | | 5.0% | -5.1% | 12.5% | -15.3% |
| Huajun Holdings Ltd ($377) | | 3.3% | 3.4% | 10.4% | 73.2% |
| |
|---|
| Median (19 companies) | 3.1% | 5.0% | 0.8% | 2.9% | 1.8% |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | | 15.3% | 0.8% | 3.0% | 4.1% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | 36.6% | 39.1% | 37.7% | 44.7% | |
| Huaxi Holdings Co Ltd ($1689) | 19.0% | 28.2% | 40.9% | 37.5% | 37.3% |
| China For You Group Co Ltd ($572) | 12.4% | | 34.6% | 31.9% | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 34.3% | 36.5% | 32.8% | 31.4% | |
| Kith Holdings Ltd ($1201) | 30.8% | 31.9% | 31.4% | 30.5% | |
| |
|---|
| Median (18 companies) | 20.9% | 20.7% | 23.4% | 22.3% | 21.5% |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | 14.0% | 17.0% | 18.0% | 20.3% | 22.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Huaxi Holdings Co Ltd ($1689) | 14.5% | 21.2% | 27.1% | 29.1% | 25.7% |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 27.9% | 30.7% | 27.4% | 26.3% | |
| Greatview Aseptic Packaging Co Ltd ($468) | 25.9% | 23.1% | 21.6% | 23.4% | |
| Kith Holdings Ltd ($1201) | 21.6% | 19.4% | 20.1% | 20.5% | |
| Jin Cai Holdings Co Ltd ($1250) | 33.2% | 26.1% | 27.6% | 19.8% | |
| |
|---|
| Median (19 companies) | 11.9% | 13.8% | 12.2% | 11.0% | 3.8% |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | 14.6% | 17.2% | 18.7% | 21.6% | 23.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jin Cai Holdings Co Ltd ($1250) | 0.0% | 0.0% | 3.0% | 122.3% | |
| Sheen Tai Holdings Grp Co Ltd ($1335) | 3.7% | 1.2% | 3.1% | 42.2% | |
| Hao Tian Development Group Ltd ($474) | 81.6% | | 13.0% | 25.4% | 4.3% |
| Kith Holdings Ltd ($1201) | 3.7% | 4.8% | 3.3% | 13.3% | |
| CPMC Holdings Ltd ($906) | 16.7% | 19.7% | 8.6% | 9.2% | |
| |
|---|
| Median (19 companies) | 5.2% | 4.4% | 4.1% | 5.5% | 4.0% |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | 19.7% | 13.7% | 13.1% | 17.1% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Huaxi Holdings Co Ltd ($1689) | 21.4% | 28.5% | 26.2% | 23.6% | 16.6% |
| Greatview Aseptic Packaging Co Ltd ($468) | 20.2% | 18.9% | 15.7% | 17.7% | |
| China Aluminum Cans Holdings Ltd ($6898) | 19.7% | 14.6% | 20.2% | 17.1% | |
| Kith Holdings Ltd ($1201) | 6.9% | 5.6% | 7.8% | 12.2% | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 8.1% | 6.4% | 4.9% | 8.0% | |
| |
|---|
| Median (19 companies) | 8.1% | 6.4% | 5.4% | 4.4% | -0.3% |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | 7.2% | 8.7% | 8.0% | 9.2% | 10.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sino Haijing Holdings Ltd ($1106) | 6.4x | 6.1x | 6.2x | 10.1x | |
| Huajun Holdings Ltd ($377) | 0.0x | 0.3x | 0.7x | 9.9x | 19.9x |
| Zhengye International Holdings Co Ltd ($3363) | 6.2x | 6.4x | 7.8x | 5.5x | |
| Overseas Chinese Town Asia Holdings Ltd ($3366) | 9.4x | 6.7x | 7.4x | 4.4x | |
| Jin Bao Bao Holdings Ltd ($1239) | -1.7x | -1.7x | -1.2x | 4.2x | |
| |
|---|
| Median (16 companies) | 1.0x | 0.6x | 0.5x | 1.3x | 9.7x |
|---|
| Lee & Man Paper Manufacturing Ltd ($2314) | 4.1x | 3.5x | 3.4x | 3.0x | 2.8x |
