Build King Holdings Ltd EBITDA surged on 71.0% in 2016 and Revenue increased on 6.6%
13/03/2017 • About Build King Holdings Ltd (
$240) • By InTwits
Build King Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Build King Holdings Ltd is a growth stock: FY2016 revenue growth was 6.6%, 5 year revenue CAGR was 33.4% at FY2016 ROIC 23.2%
- EBITDA Margin is expanding: 4.3% in FY2016 vs. 2.7% in FY2015 vs. 0.1% in FY2012
- EBITDA Margin is quite volatile: 4.3% in FY2016, 2.7% in FY2015, 2.3% in FY2014, 1.4% in FY2013, 0.1% in FY2012
- The company has highly profitable business model: ROIC is at 23.2%
- It operates with high leverage: Net Debt/EBITDA is -2.2x while industry average is -57.2x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Build King Holdings Ltd ($240) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 2,142 | 2,193 | 3,237 | 4,572 | 4,871 | 6.6% |
| Gross Profit | 112 | 132 | 220 | 276 | 372 | 34.7% |
| SG&A | | | 163 | 181 | | -100.0% |
| EBITDA | 2 | 31 | 75 | 124 | 212 | 71.0% |
| Net Income | 21 | 21 | 55 | 94 | 151 | 59.6% |
Balance Sheet
|
|---|
| Cash | 155 | 299 | 411 | 801 | 826 | 3.2% |
| Short Term Debt | 115 | 94 | 96 | 97 | 243 | 151.5% |
| Long Term Debt | 7 | 6 | 0 | 114 | 128 | 12.5% |
Cash flow
|
|---|
| Capex | 23 | 45 | 73 | 103 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 85.8% | 2.4% | 47.6% | 41.2% | 6.6% | |
| EBITDA growth | -95.4% | 1,259.0% | 141.3% | 65.7% | 71.0% | |
| Gross Margin | 5.2% | 6.0% | 6.8% | 6.0% | 7.6% | 1.6% |
| EBITDA Margin | 0.1% | 1.4% | 2.3% | 2.7% | 4.3% | 1.6% |
| Net Income Margin | 1.0% | 1.0% | 1.7% | 2.1% | 3.1% | 1.0% |
| SG&A, % of revenue | | | 5.0% | 4.0% | | -4.0% |
| CAPEX, % of revenue | 1.1% | 2.0% | 2.2% | 2.2% | | -2.2% |
| ROIC | -2.5% | 3.5% | 13.4% | 18.3% | 23.2% | 4.9% |
| ROE | 7.8% | 7.4% | 17.1% | 24.6% | 31.1% | 6.5% |
| Net Debt/EBITDA | -14.8x | -6.4x | -4.2x | -4.8x | -2.2x | 2.6x |
Revenue and profitability
Build King Holdings Ltd's Revenue increased on 6.6%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 3.6 pp from 2.9% to -0.70% in FY2016.
Gross Margin increased slightly on 1.6 pp from 6.0% to 7.6% in FY2016.
Net Income marign increased slightly on 1.0 pp from 2.1% to 3.1% in FY2016.
Return on investment
The company operates at high and attractive ROIC (23.23%) and ROE (31.07%). ROIC increased on 4.9 pp from 18.3% to 23.2% in FY2016. ROE increased on 6.5 pp from 24.6% to 31.1% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.2x and Debt / EBITDA is 1.8x. Net Debt / EBITDA jumped on 2.6x from -4.8x to -2.2x in FY2016. Debt surged on 76.2% while cash increased on 3.2%.
Appendix 1: Peers in Investment Companies
Below we provide Build King Holdings Ltd benchmarking against other companies in Investment Companies 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 |
|---|
| CK Hutchison Holdings Ltd ($1) | -41.8% | -11.4% | -90.8% | 10,576.1% | |
| UBA Investments Ltd ($768) | | | -32.2% | 4,559.4% | |
| Capital VC Ltd ($2324) | | | 489.2% | 861.9% | |
| Prosperity Investment Holdings Ltd ($310) | | 20.9% | -48.8% | 559.5% | |
| China Innovation Investment Ltd ($1217) | | | | 517.9% | |
| |
|---|
| Median (22 companies) | -14.8% | 5.5% | 9.5% | 105.9% | 68.8% |
|---|
| Build King Holdings Ltd ($240) | | 2.4% | 47.6% | 41.2% | 6.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Properties Investment Holdings Ltd ($736) | 47.5% | 40.8% | 46.2% | 87.2% | 44.8% |
| City e-Solutions Ltd ($557) | 81.1% | 81.5% | 81.6% | 79.1% | |
| Eternity Investment Ltd ($764) | | | 86.6% | 48.2% | |
| AVIC Joy Holdings HK Ltd ($260) | 19.5% | 20.9% | 14.0% | 16.3% | |
| Infinity Financial Group Holdings Ltd ($1152) | 19.0% | 17.5% | 22.4% | 15.8% | |
| |
|---|
| Median (6 companies) | 40.8% | 20.9% | 34.3% | 32.3% | 50.1% |
|---|
| Build King Holdings Ltd ($240) | 5.2% | 6.0% | 6.8% | 6.0% | 7.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital VC Ltd ($2324) | | 36.7% | 93.1% | 99.3% | |
| Harmony Asset Ltd ($428) | 39.8% | | | 95.7% | |
| Unity Investments Holdings Ltd ($913) | | 89.0% | 90.8% | 95.7% | |
| Langham Hospitality Investments and Langham Hospitality Investments Ltd ($1270) | | 101.3% | 85.9% | 85.8% | 90.3% |
| China Development Bank International Investment Ltd ($1062) | -74.4% | 26.1% | 69.2% | 85.6% | |
| |
|---|
| Median (25 companies) | 8.6% | -7.8% | 1.9% | 19.3% | 2.0% |
|---|
| Build King Holdings Ltd ($240) | 0.1% | 1.4% | 2.3% | 2.7% | 4.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Properties Investment Holdings Ltd ($736) | 55.3% | 3.0% | 20.8% | 58.1% | 23.8% |
| Langham Hospitality Investments and Langham Hospitality Investments Ltd ($1270) | | 13.7% | 17.1% | 39.8% | 9.3% |
| Heritage International Holdings Ltd ($412) | | 10.9% | 7.4% | 37.9% | 3.5% |
| Opes Asia Development Ltd ($810) | | 11.3% | 76.1% | 25.0% | |
| CK Hutchison Holdings Ltd ($1) | 0.7% | 1.0% | 503.6% | 13.5% | |
| |
|---|
| Median (25 companies) | 0.7% | 0.6% | 0.2% | 0.9% | 4.5% |
|---|
| Build King Holdings Ltd ($240) | 1.1% | 2.0% | 2.2% | 2.2% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Capital VC Ltd ($2324) | | | 21.8% | 100.7% | -17.2% |
| Harmony Asset Ltd ($428) | 3.2% | -13.7% | -15.4% | 88.0% | |
| Unity Investments Holdings Ltd ($913) | -36.2% | 26.4% | 47.4% | 17.5% | |
| UBA Investments Ltd ($768) | -22.2% | -1.9% | -8.6% | 13.2% | -6.1% |
| China Development Bank International Investment Ltd ($1062) | -1.4% | 1.3% | 4.2% | 9.7% | |
| |
|---|
| Median (39 companies) | -3.1% | -2.4% | -4.8% | -2.2% | -6.2% |
|---|
| Build King Holdings Ltd ($240) | -2.5% | 3.5% | 13.4% | 18.3% | 23.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Langham Hospitality Investments and Langham Hospitality Investments Ltd ($1270) | | 12.5x | 9.5x | 11.2x | 10.2x |
| CK Hutchison Holdings Ltd ($1) | 1.9x | 0.6x | 7.2x | 5.5x | |
| COL Capital Ltd ($383) | | | 2.4x | 3.8x | |
| China Financial International Investments Ltd ($721) | | | | 2.4x | |
| Harmony Asset Ltd ($428) | -3.2x | | | -0.1x | |
| |
|---|
| Median (15 companies) | -1.1x | 0.3x | -0.2x | -0.8x | -4.3x |
|---|
| Build King Holdings Ltd ($240) | -14.8x | -6.4x | -4.2x | -4.8x | -2.2x |
