Lifestyle International Holdings Ltd Debt jumped on 34.7% in 2016 while EBITDA dropped on 19.1%
13/03/2017 • About Lifestyle International Holdings Ltd (
$1212) • By InTwits
Lifestyle International Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- The company has business model with low profitability: ROIC is at 8.7%
- It operates with high leverage: Net Debt/EBITDA is 4.3x while industry average is 0.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Lifestyle International Holdings Ltd ($1212) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 5,523 | 5,955 | 5,970 | 6,171 | 4,672 | -24.3% |
| Gross Profit | 3,267 | 3,561 | 3,584 | 3,707 | 2,643 | -28.7% |
| SG&A | 1,278 | 1,440 | 1,456 | 1,518 | 744 | -51.0% |
| EBITDA | 2,624 | 2,797 | 2,670 | 2,676 | 2,164 | -19.1% |
| Net Income | 2,057 | 2,448 | 2,144 | 1,914 | 1,590 | -16.9% |
Balance Sheet
|
|---|
| Cash | 8,292 | 8,669 | 8,312 | 8,670 | 7,520 | -13.3% |
| Short Term Debt | 1,240 | 1,858 | 2,004 | 3,165 | 7,307 | 130.9% |
| Long Term Debt | 9,702 | 8,984 | 8,519 | 9,351 | 9,550 | 2.1% |
Cash flow
|
|---|
| Capex | 2,993 | 482 | 607 | 809 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 7.6% | 7.8% | 0.2% | 3.4% | -24.3% | |
| EBITDA growth | 3.0% | 6.6% | -4.5% | 0.2% | -19.1% | |
| Gross Margin | 59.1% | 59.8% | 60.0% | 60.1% | 56.6% | -3.5% |
| EBITDA Margin | 47.5% | 47.0% | 44.7% | 43.4% | 46.3% | 3.0% |
| Net Income Margin | 37.2% | 41.1% | 35.9% | 31.0% | 34.0% | 3.0% |
| SG&A, % of revenue | 23.1% | 24.2% | 24.4% | 24.6% | 15.9% | -8.7% |
| CAPEX, % of revenue | 54.2% | 8.1% | 10.2% | 13.1% | | -13.1% |
| ROIC | 12.5% | 11.2% | 10.0% | 9.6% | 8.7% | -0.9% |
| ROE | 23.1% | 24.5% | 19.9% | 17.2% | 24.5% | 7.3% |
| Net Debt/EBITDA | 1.0x | 0.8x | 0.8x | 1.4x | 4.3x | 2.9x |
Revenue and profitability
The company's Revenue dropped on 24.3%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 3.0 pp from 43.4% to 46.3% in FY2016.
Gross Margin decreased on 3.5 pp from 60.1% to 56.6% in FY2016. SG&A as a % of Revenue decreased on 8.7 pp from 24.6% to 15.9% in FY2016.
Net Income marign increased on 3.0 pp from 31.0% to 34.0% in FY2016.
Return on investment
The company operates at good ROE (24.52%) while ROIC is low (8.74%). ROIC decreased slightly on 0.85 pp from 9.6% to 8.7% in FY2016. ROE increased on 7.3 pp from 17.2% to 24.5% in FY2016.
Leverage (Debt)
Debt level is 4.3x Net Debt / EBITDA and 7.8x Debt / EBITDA. Net Debt / EBITDA surged on 2.9x from 1.4x to 4.3x in FY2016. Debt jumped on 34.7% while cash dropped on 13.3%.
Appendix 1: Peers in Retail
Below you can find Lifestyle International Holdings Ltd benchmarking vs. other companies in Retail 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 Nuclear Industry 23 International Corp Ltd ($611) | 1.4% | 85.6% | -42.1% | 419.8% | |
| Noble House China Holdings Ltd ($8246) | -5.0% | -20.2% | -24.8% | 117.2% | |
| Vongroup Ltd ($318) | | 23.7% | -80.2% | 90.3% | -7.2% |
| Nanjing Sinolife United Co Ltd ($3332) | 45.6% | 29.5% | 29.6% | 57.3% | |
| Shanghai La Chapelle Fashion Co Ltd ($6116) | 54.9% | 72.8% | 23.0% | 48.3% | |
| |
|---|
| Median (117 companies) | 7.5% | 6.1% | 3.1% | -1.0% | -7.6% |
|---|
| Lifestyle International Holdings Ltd ($1212) | | 7.8% | 0.2% | 3.4% | -24.3% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Vongroup Ltd ($318) | | | 95.1% | 99.1% | 99.0% |
| Modern Beauty Salon Holdings Ltd ($919) | 97.4% | 95.9% | 96.8% | 96.7% | 96.8% |
| Moiselle International Holdings Ltd ($130) | 81.2% | 83.8% | 80.6% | 83.2% | 77.6% |
| Embry Holdings Ltd ($1388) | 81.2% | 80.4% | 82.3% | 81.6% | |
| Nanjing Sinolife United Co Ltd ($3332) | 86.5% | 89.3% | 90.9% | 80.6% | |
| |
|---|
| Median (103 companies) | 36.2% | 35.8% | 35.0% | 33.3% | 44.4% |
|---|
| Lifestyle International Holdings Ltd ($1212) | 59.1% | 59.8% | 60.0% | 60.1% | 56.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Energy Development Holdings Ltd ($228) | -58.1% | -72.3% | -84.0% | 1,070.6% | |
| Golden Eagle Retail Group Ltd ($3308) | 48.5% | 47.3% | 42.8% | 55.4% | |
| Nanjing Sinolife United Co Ltd ($3332) | 51.6% | 56.9% | 54.4% | 44.8% | |
| China Dongxiang Group Co Ltd ($3818) | 6.0% | 5.6% | 58.3% | 41.4% | |
| Maoye International Holdings Ltd ($848) | 47.4% | 46.3% | 73.2% | 39.6% | |
| |
|---|
| Median (117 companies) | 10.3% | 7.3% | 8.9% | 7.1% | 5.7% |
|---|
| Lifestyle International Holdings Ltd ($1212) | 47.5% | 47.0% | 44.7% | 43.4% | 46.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Culture Landmark Investment Ltd ($674) | 11.6% | 19.4% | 15.7% | 47.2% | 3.9% |
| Springland International Holdings Ltd ($1700) | 31.9% | 17.4% | 26.5% | 36.9% | |
| Merry Garden Holdings Ltd ($1237) | 18.6% | 28.6% | 15.1% | 34.2% | |
| China Energy Development Holdings Ltd ($228) | 1.6% | 0.2% | 0.0% | 27.4% | |
| Golden Eagle Retail Group Ltd ($3308) | 28.5% | 9.4% | 26.7% | 25.4% | |
| |
|---|
| Median (117 companies) | 4.0% | 3.6% | 3.7% | 3.1% | 1.9% |
|---|
| Lifestyle International Holdings Ltd ($1212) | 54.2% | 8.1% | 10.2% | 13.1% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Modern Beauty Salon Holdings Ltd ($919) | 50.7% | -4.6% | 81.3% | 71.8% | 13.3% |
| JC Group Holdings Ltd ($8326) | | 215.6% | 92.8% | 66.3% | 81.7% |
| Starbucks Corp ($4337) | 36.4% | -6.0% | 52.8% | 51.4% | 46.2% |
| Sa Sa International Holdings Ltd ($178) | 53.5% | 52.7% | 49.0% | 39.8% | 19.0% |
| Noble House China Holdings Ltd ($8246) | 17.7% | -67.7% | -113.8% | 35.6% | |
| |
|---|
| Median (117 companies) | 12.2% | 8.8% | 8.5% | 5.8% | 2.5% |
|---|
| Lifestyle International Holdings Ltd ($1212) | 12.5% | 11.2% | 10.0% | 9.6% | 8.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sparkle Roll Group Ltd ($970) | 0.6x | 4.0x | 9.3x | 23.5x | 8.5x |
| Trinity Ltd ($891) | -0.2x | 0.2x | 0.6x | 18.2x | |
| Parkson Retail Group Ltd ($3368) | 0.8x | 2.3x | 3.6x | 9.8x | 11.1x |
| Maoye International Holdings Ltd ($848) | 2.9x | 3.3x | 3.4x | 9.0x | |
| Century Ginwa Retail Holdings Ltd ($162) | 2.0x | 2.5x | 4.8x | 7.3x | |
| |
|---|
| Median (91 companies) | -0.5x | -0.6x | -0.2x | -0.5x | -0.8x |
|---|
| Lifestyle International Holdings Ltd ($1212) | 1.0x | 0.8x | 0.8x | 1.4x | 4.3x |
