Harbour Centre Development Ltd reports 43.8% Net Income decline and 29.5% Revenue decline
02/03/2017 • About Harbour Centre Development Ltd (
$51) • By InTwits
Harbour Centre Development 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 3.9%.
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Harbour Centre Development Ltd ($51) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 6,261 | 5,758 | 5,646 | 5,048 | 3,558 | -29.5% |
| SG&A | 295 | 247 | 206 | 228 | 205 | -10.1% |
| EBITDA | 2,271 | 1,248 | 939 | 1,538 | 876 | -43.0% |
| Net Income | 3,058 | 1,276 | 1,082 | 1,231 | 692 | -43.8% |
Balance Sheet
|
|---|
| Cash | 7,731 | 5,825 | 5,185 | 6,447 | 5,154 | -20.1% |
| Short Term Debt | 800 | 500 | 250 | 400 | 800 | 100.0% |
| Long Term Debt | 2,350 | 5,738 | 4,168 | 4,400 | 2,450 | -44.3% |
Cash flow
|
|---|
| Capex | 489 | 5,187 | 1,182 | 1,044 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 382.8% | -8.0% | -1.9% | -10.6% | -29.5% | |
| EBITDA growth | 421.2% | -45.0% | -24.8% | 63.8% | -43.0% | |
| EBITDA Margin | 36.3% | 21.7% | 16.6% | 30.5% | 24.6% | -5.8% |
| Net Income Margin | 48.8% | 22.2% | 19.2% | 24.4% | 19.4% | -4.9% |
| SG&A, % of revenue | 4.7% | 4.3% | 3.6% | 4.5% | 5.8% | 1.2% |
| CAPEX, % of revenue | 7.8% | 90.1% | 20.9% | 20.7% | | -20.7% |
| ROIC | 12.8% | 5.7% | 3.9% | 6.7% | 3.9% | -2.8% |
| ROE | 23.5% | 8.5% | 6.9% | 7.6% | 4.3% | -3.3% |
| Net Debt/EBITDA | -2.0x | 0.3x | -0.8x | -1.1x | -2.2x | -1.1x |
Revenue and profitability
The company's Revenue dropped on 29.5%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.93 pp from 36.4% to 37.3% in FY2016.
SG&A as a % of Revenue increased slightly on 1.2 pp from 4.5% to 5.8% in FY2016.
Net Income marign decreased on 4.9 pp from 24.4% to 19.4% in FY2016.
Return on investment
The company operates at low ROIC (3.90%) and ROE (4.32%). ROIC decreased on 2.8 pp from 6.7% to 3.9% in FY2016. ROE decreased on 3.3 pp from 7.6% to 4.3% in FY2016.
Leverage (Debt)
Debt level is -2.2x Net Debt / EBITDA and 3.7x Debt / EBITDA. Net Debt / EBITDA dropped on 1.1x from -1.1x to -2.2x in FY2016. Debt dropped on 32.3% while cash dropped on 20.1%.
Appendix 1: Peers in Lodging
Below you can find Harbour Centre Development 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) | 8.7% | 13.8% | 0.8% | -3.5% | -3.2% |
|---|
| Harbour Centre Development Ltd ($51) | | -8.0% | -1.9% | -10.6% | -29.5% |
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) | 26.7% | 26.4% | 25.8% | 22.6% | 26.0% |
|---|
| Harbour Centre Development Ltd ($51) | 36.3% | 21.7% | 16.6% | 30.5% | 24.6% |
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) | 6.3% | 8.9% | 10.8% | 12.8% | 6.4% |
|---|
| Harbour Centre Development Ltd ($51) | 7.8% | 90.1% | 20.9% | 20.7% | |
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% | 7.5% |
|---|
| Harbour Centre Development Ltd ($51) | 12.8% | 5.7% | 3.9% | 6.7% | 3.9% |
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 | 1.6x |
|---|
| Harbour Centre Development Ltd ($51) | -2.0x | 0.3x | -0.8x | -1.1x | -2.2x |
