Liu Chong Hing Investment Ltd reports 42.3 pp EBITDA Margin decline from 42.3% to in 2016 in 2016
08/03/2017 • About Liu Chong Hing Investment Ltd (
$194) • By InTwits
Liu Chong Hing Investment Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Liu Chong Hing Investment Ltd is a company in decline: FY2016 revenue growth was -11.6%, 5 years revenue CAGR was -15.9%
- EBITDA Margin is declining: in FY2016 vs. 42.3% in FY2015 vs. 69.6% in FY2012
- The company has potentially unprofitable business model: ROIC is at 4.2%
- It operates with high leverage: Net Debt/EBITDA is 5.6x while industry average is 3.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Liu Chong Hing Investment Ltd ($194) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 619 | 643 | 832 | 1,299 | 1,149 | -11.6% |
| EBITDA | 431 | 457 | 522 | 550 | | -100.0% |
| Net Income | 480 | 543 | 2,357 | 410 | 458 | 11.6% |
Balance Sheet
|
|---|
| Cash | 17,846 | 466 | 1,139 | 1,044 | 1,265 | 21.2% |
| Short Term Debt | 5,574 | 1,834 | 843 | 862 | 145 | -83.2% |
| Long Term Debt | 1,899 | 1,948 | 2,197 | 490 | 1,039 | 112.1% |
Cash flow
|
|---|
| Capex | 115 | 39 | 2,243 | 11 | | -100.0% |
Ratios
|
|---|
| Revenue growth | -77.4% | 3.8% | 29.4% | 56.2% | -11.6% | |
| EBITDA growth | -75.1% | 6.0% | 14.2% | 5.3% | | |
| EBITDA Margin | 69.6% | 71.1% | 62.8% | 42.3% | 0.0% | -42.3% |
| Net Income Margin | 77.5% | 84.5% | 283.4% | 31.6% | 39.9% | 8.3% |
| CAPEX, % of revenue | 18.5% | 6.1% | 269.7% | 0.9% | | -0.9% |
| ROIC | 1.3% | 1.6% | 2.7% | 3.5% | 4.2% | 0.7% |
| ROE | 5.7% | 6.1% | 23.4% | 3.7% | 4.2% | 0.4% |
| Net Debt/EBITDA | -24.1x | 7.3x | 3.6x | 0.6x | | -0.6x |
Revenue and profitability
Liu Chong Hing Investment Ltd's Revenue dropped on 11.6%.
Net Income marign increased on 8.3 pp from 31.6% to 39.9% in FY2016.
Return on investment
The company operates at low ROIC (4.18%) and ROE (4.19%). ROIC increased slightly on 0.69 pp from 3.5% to 4.2% in FY2016. ROE showed almost no change in FY2016.
Leverage (Debt)
Debt dropped on 12.4% while cash surged on 21.2%.
Appendix 1: Peers in Real Estate
Below we provide Liu Chong Hing Investment 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% | -82.8% |
| Henderson Investment Ltd ($97) | -78.9% | | | 737.1% | |
| ITC Properties Group Ltd ($199) | | -95.2% | 75.7% | 678.6% | 206.4% |
| |
|---|
| Median (179 companies) | 15.8% | 13.5% | 5.2% | 4.2% | 7.5% |
|---|
| Liu Chong Hing Investment Ltd ($194) | | 3.8% | 29.4% | 56.2% | -11.6% |
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 (161 companies) | 41.9% | 41.9% | 39.2% | 38.2% | 44.5% |
|---|
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% |
|---|
| Liu Chong Hing Investment Ltd ($194) | 69.6% | 71.1% | 62.8% | 42.3% | |
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% | 6.2% | 4.7% | 3.3% | 3.3% |
|---|
| Liu Chong Hing Investment Ltd ($194) | 18.5% | 6.1% | 269.7% | 0.9% | |
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) | 4.2% | 4.1% | 4.2% | 2.4% | 2.4% |
|---|
| Liu Chong Hing Investment Ltd ($194) | 1.3% | 1.6% | 2.7% | 3.5% | 4.2% |
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) | 2.4x | 2.7x | 3.0x | 3.3x | 3.1x |
|---|
| Liu Chong Hing Investment Ltd ($194) | -24.1x | 7.3x | 3.6x | 0.6x | |
