CAR Inc revenue growth decelerated to 29.0% in FY2016 vs. 42.1% a year earliner
14/03/2017 • About CAR Inc (
$699) • By InTwits
CAR Inc reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- CAR Inc is a fast growth stock: FY2016 revenue growth was 29.0%, 5 year revenue CAGR was 51.1% at FY2016 ROIC 15.1%
- CAR Inc has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.9%. At the same time it's in pair with industry average of 9.6%.
- CAPEX is quite volatile: 274 in FY2016, 236 in FY2015, 81.2 in FY2014, 32.2 in FY2013, 31.4 in FY2012
- The company has highly profitable business model: ROIC is at 15.1%
- It operates with high leverage: Net Debt/EBITDA is 1.5x while industry average is -1.6x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
CAR Inc ($699) key annual financial indicators
| mln. CNY | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,609 | 2,703 | 3,520 | 5,003 | 6,454 | 29.0% |
| Gross Profit | 493 | 629 | 1,239 | 2,091 | 2,086 | -0.2% |
| SG&A | 344 | 524 | 433 | 535 | 609 | 14.0% |
| EBITDA | 701 | 813 | 1,517 | 3,371 | 4,032 | 19.6% |
| Net Income | -132 | -223 | 436 | 1,401 | 1,460 | 4.2% |
Balance Sheet
|
|---|
| Cash | 910 | 842 | 1,352 | 1,988 | 5,723 | 187.9% |
| Short Term Debt | 2,496 | 2,248 | 2,779 | 1,154 | 2,425 | 110.1% |
| Long Term Debt | 498 | 1,563 | 832 | 7,359 | 9,257 | 25.8% |
Cash flow
|
|---|
| Capex | 31 | 32 | 81 | 236 | 274 | 15.8% |
Ratios
|
|---|
| Revenue growth | 96.4% | 68.0% | 30.3% | 42.1% | 29.0% | |
| EBITDA growth | 170.9% | 15.9% | 86.7% | 122.3% | 19.6% | |
| Gross Margin | 30.6% | 23.3% | 35.2% | 41.8% | 32.3% | -9.5% |
| EBITDA Margin | 43.6% | 30.1% | 43.1% | 67.4% | 62.5% | -4.9% |
| Net Income Margin | -8.2% | -8.3% | 12.4% | 28.0% | 22.6% | -5.4% |
| SG&A, % of revenue | 21.4% | 19.4% | 12.3% | 10.7% | 9.4% | -1.2% |
| CAPEX, % of revenue | 2.0% | 1.2% | 2.3% | 4.7% | 4.2% | -0.5% |
| ROIC | 5.2% | 2.7% | 12.2% | 19.0% | 15.1% | -4.0% |
| ROE | -162.0% | -505.0% | 15.4% | 22.1% | 19.1% | -3.0% |
| Net Debt/EBITDA | 3.0x | 3.7x | 1.5x | 1.9x | 1.5x | -0.5x |
Revenue and profitability
CAR Inc's Revenue surged on 29.0%. 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.
Gross Margin decreased on 9.5 pp from 41.8% to 32.3% in FY2016. SG&A as a % of Revenue decreased slightly on 1.2 pp from 10.7% to 9.4% in FY2016.
Net Income marign decreased on 5.4 pp from 28.0% to 22.6% in FY2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 4.2% in FY2016. CAR Inc showed CAPEX/Revenue growth of 3.1 pp from 1.2% in FY2013 to 4.2% in FY2016. It's average CAPEX/Revenue for the last three years was 3.8%.
Return on investment
The company operates at good ROIC (15.06%) and ROE (19.06%). ROIC decreased on 4.0 pp from 19.0% to 15.1% in FY2016. ROE decreased on 3.0 pp from 22.1% to 19.1% in FY2016.
Leverage (Debt)
Debt level is 1.5x Net Debt / EBITDA and 2.9x Debt / EBITDA. Net Debt / EBITDA dropped on 0.5x from 1.9x to 1.5x in FY2016. Debt jumped on 37.2% while cash jumped on 188%.
Management team
Yifan Song is a CAR Inc's CEO. Yifan Song has spent 2 years at the company. CAR Inc's CFO is Wei Li "Wilson". Wei Li "Wilson" has 4 years tenure at the company.
Appendix 1: Peers in Commercial Services
Below we provide CAR Inc benchmarking against other companies in Commercial Services 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 |
|---|
| Kai Yuan Holdings Ltd ($1215) | 99.1% | 14.9% | -88.3% | 271.8% | |
| China Seven Star Holdings Ltd ($245) | 6.7% | -81.8% | -39.3% | 195.3% | |
| China Smartpay Group Holdings Ltd ($8325) | | 274.7% | 75.6% | 124.5% | 79.5% |
| Celebrate International Holdings Ltd ($8212) | | 1,437.6% | -6.3% | 117.0% | -78.1% |
| Haier Healthwise Holdings Ltd ($348) | | -50.1% | -7.5% | 101.1% | -9.4% |
| |
|---|
| Median (67 companies) | 5.7% | 8.6% | 9.8% | 4.0% | 8.7% |
|---|
| CAR Inc ($699) | | 68.0% | 30.3% | 42.1% | 29.0% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| HC International Inc ($2280) | 87.5% | 91.9% | 92.5% | 89.6% | |
| Winto Group Holdings Ltd ($8238) | 90.2% | 93.4% | 92.0% | 88.4% | |
| Dingyi Group Investment Ltd ($508) | 75.8% | | 64.5% | 86.0% | 89.6% |
| Fu Shou Yuan International Group Ltd ($1448) | 80.5% | 80.4% | 80.0% | 77.6% | |
| Nirvana Asia Ltd ($1438) | 68.3% | 69.6% | 70.5% | 75.7% | |
| |
|---|
| Median (61 companies) | 31.9% | 31.0% | 31.0% | 30.9% | 30.1% |
|---|
| CAR Inc ($699) | 30.6% | 23.3% | 35.2% | 41.8% | 32.3% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Zuoli Kechuang Micro-Finance Co Ltd ($6866) | 61.6% | 84.9% | 75.9% | 80.9% | |
| Shenzhen International Holdings Ltd ($152) | 60.2% | 65.8% | 97.1% | 73.6% | |
| Yuexiu Transport Infrastructure Ltd ($1052) | 78.3% | 74.5% | 74.0% | 71.6% | 84.1% |
| Jiangsu Expressway Co Ltd ($177) | 57.0% | 60.7% | 59.3% | 61.5% | |
| Dragon Crown Group Holdings Ltd ($935) | 67.3% | 62.9% | 60.2% | 61.1% | |
| |
|---|
| Median (67 companies) | 17.5% | 14.9% | 11.2% | 9.8% | 1.5% |
|---|
| CAR Inc ($699) | 43.6% | 30.1% | 43.1% | 67.4% | 62.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Blue Sky Power Holdings Ltd ($6828) | 21.3% | 9.0% | 13.9% | 47.4% | |
| COSCO Pacific Ltd ($1199) | 96.6% | 66.6% | 43.3% | 45.8% | |
| Shenzhen International Holdings Ltd ($152) | 23.0% | 22.1% | 20.9% | 35.0% | |
| Celebrate International Holdings Ltd ($8212) | 211.7% | 12.0% | 6.2% | 34.2% | 18.6% |
| China Maple Leaf Educational Systems Ltd ($1317) | 25.7% | 50.9% | 21.1% | 32.8% | 18.0% |
| |
|---|
| Median (67 companies) | 3.0% | 3.8% | 2.6% | 2.8% | 1.8% |
|---|
| CAR Inc ($699) | 2.0% | 1.2% | 2.3% | 4.7% | 4.2% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Bamboos Health Care Holdings Ltd ($8216) | | 71.1% | 50.1% | 58.3% | 40.0% |
| Wonderful Sky Financial Group Holdings Ltd ($1260) | 51.5% | 26.6% | 30.0% | 29.5% | 19.8% |
| 1010 Printing Group Ltd ($1127) | 13.5% | 20.8% | 17.8% | 19.9% | 18.8% |
| China Packaging Holdings Development Ltd ($1439) | 52.0% | 46.6% | 34.1% | 19.8% | |
| iOne Holdings Ltd ($982) | 12.5% | 11.1% | 9.4% | 19.2% | |
| |
|---|
| Median (67 companies) | 7.5% | 7.0% | 5.8% | 3.3% | 1.8% |
|---|
| CAR Inc ($699) | 5.2% | 2.7% | 12.2% | 19.0% | 15.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Celebrate International Holdings Ltd ($8212) | | | | 22.2x | |
| Kai Yuan Holdings Ltd ($1215) | -143.8x | -0.7x | | 18.8x | |
| Eagle Legend Asia Ltd ($936) | 4.0x | 4.0x | 3.3x | 6.2x | |
| Sichuan Expressway Co Ltd ($107) | 2.7x | 3.8x | 4.3x | 5.5x | |
| Yuexiu Transport Infrastructure Ltd ($1052) | 4.5x | 3.1x | 2.7x | 5.3x | 3.5x |
| |
|---|
| Median (44 companies) | -0.0x | -0.7x | -0.9x | -0.8x | -2.3x |
|---|
| CAR Inc ($699) | 3.0x | 3.7x | 1.5x | 1.9x | 1.5x |
