SJM Holdings Ltd revenue dropped on 15.0% in 2016 while EBITDA Margin increased slightly on 1.1 pp from 6.7% to 7.8%
28/02/2017 • About SJM Holdings Ltd (
$880) • By InTwits
SJM Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- SJM Holdings Ltd is a company in decline: FY2016 revenue growth was -15.0%, 5 years revenue CAGR was -11.3%
- The company has business model with low profitability: ROIC is at 8.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
SJM Holdings Ltd ($880) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 79,519 | 87,651 | 79,934 | 49,171 | 41,798 | -15.0% |
| Gross Profit | 79,242 | 87,358 | 79,668 | 48,922 | 41,557 | -15.1% |
| SG&A | 42,361 | 46,637 | 42,569 | 27,651 | 23,390 | -15.4% |
| EBITDA | 7,712 | 8,678 | 7,632 | 3,313 | 3,264 | -1.5% |
| Net Income | 6,745 | 7,706 | 6,731 | 2,465 | 2,327 | -5.6% |
Balance Sheet
|
|---|
| Cash | 11,932 | 11,145 | 9,547 | 10,372 | 9,510 | -8.3% |
| Short Term Debt | 287 | 351 | 281 | 163 | 832 | 409.4% |
| Long Term Debt | 2,423 | 1,961 | 1,383 | 1,184 | 273 | -76.9% |
Cash flow
|
|---|
| Capex | 389 | 1,150 | 3,650 | 3,352 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 4.5% | 10.2% | -8.8% | -38.5% | -15.0% | |
| EBITDA growth | 19.9% | 12.5% | -12.1% | -56.6% | -1.5% | |
| Gross Margin | 99.7% | 99.7% | 99.7% | 99.5% | 99.4% | -0.1% |
| EBITDA Margin | 9.7% | 9.9% | 9.5% | 6.7% | 7.8% | 1.1% |
| Net Income Margin | 8.5% | 8.8% | 8.4% | 5.0% | 5.6% | 0.6% |
| SG&A, % of revenue | 53.3% | 53.2% | 53.3% | 56.2% | 56.0% | -0.3% |
| CAPEX, % of revenue | 0.5% | 1.3% | 4.6% | 6.8% | | -6.8% |
| ROIC | 29.7% | 31.0% | 24.8% | 8.6% | 8.6% | 0.0% |
| ROE | 36.4% | 35.6% | 27.9% | 10.3% | 9.7% | -0.6% |
| Net Debt/EBITDA | -1.2x | -1.0x | -1.0x | -2.7x | -2.6x | 0.1x |
Revenue and profitability
SJM Holdings Ltd's Revenue dropped on 15.0%. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 1.1 pp from 6.7% to 7.8% in FY2016.
Gross Margin showed almost no change in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased slightly on 0.55 pp from 5.0% to 5.6% in FY2016.
Return on investment
The company operates at low ROIC (8.58%) and ROE (9.68%). ROIC showed almost no change in FY2016. ROE decreased slightly on 0.57 pp from 10.3% to 9.7% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.6x and Debt / EBITDA is 0.3x. Net Debt / EBITDA surged on 0.1x from -2.7x to -2.6x in FY2016. Debt dropped on 18.0% while cash decreased on 8.3%.
Management team
SJM Holdings Ltd's CEO is So Shu Fai "Ambrose". So Shu Fai "Ambrose" has 12 years tenure at the company.
Appendix 1: Peers in Lodging
Below you can find SJM Holdings 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% | 13.8% | 0.8% | -3.5% | -2.8% |
|---|
| SJM Holdings Ltd ($880) | | 10.2% | -8.8% | -38.5% | -15.0% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| 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% |
| NagaCorp Ltd ($3918) | 72.9% | 72.1% | 67.4% | 65.1% | 69.0% |
| |
|---|
| Median (17 companies) | 55.7% | 46.3% | 51.3% | 45.4% | 62.0% |
|---|
| SJM Holdings Ltd ($880) | 99.7% | 99.7% | 99.7% | 99.5% | 99.4% |
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% |
|---|
| SJM Holdings Ltd ($880) | 9.7% | 9.9% | 9.5% | 6.7% | 7.8% |
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% | 13.2% | 14.5% | 6.4% |
|---|
| SJM Holdings Ltd ($880) | 0.5% | 1.3% | 4.6% | 6.8% | |
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% |
| Galaxy Entertainment Group Ltd ($27) | 25.2% | 30.0% | 27.5% | 10.2% | 12.7% |
| |
|---|
| Median (23 companies) | 5.7% | 5.6% | 3.6% | 2.7% | 6.5% |
|---|
| SJM Holdings Ltd ($880) | 29.7% | 31.0% | 24.8% | 8.6% | 8.6% |
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 |
|---|
| SJM Holdings Ltd ($880) | -1.2x | -1.0x | -1.0x | -2.7x | -2.6x |
