Solomon Systech International Ltd revenue started to decline in FY2016: decreased 3.5% vs. 18.0% growth a year earliner
15/03/2017 • About Solomon Systech International Ltd (
$2878) • By InTwits
Solomon Systech International Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Solomon Systech International Ltd doesn't have a profitable business model yet: FY2016 ROIC is -11.6%
- The company operates at negative EBITDA Margin: -16.2%
- Solomon Systech International Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2012-FY2016 was 0.0%. On average EBITDA Margin was -11.0% for the sames years0
- The company has unprofitable business model: ROIC is at -11.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Solomon Systech International Ltd ($2878) key annual financial indicators
| mln. $ | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 65.123 | 55.150 | 60.072 | 70.902 | 68.408 | -3.5% |
| Gross Profit | 25.144 | 20.996 | 20.796 | 23.218 | 23.530 | 1.3% |
| SG&A | 11.363 | 11.222 | 11.065 | 11.886 | 14.902 | 25.4% |
| EBITDA | -4.291 | -6.419 | -5.968 | -7.463 | -11.052 | |
| Net Income | -1.370 | 1.334 | -3.005 | -6.435 | -6.929 | |
Balance Sheet
|
|---|
| Cash | 36.816 | 12.181 | 25.013 | 26.099 | 24.557 | -5.9% |
| Short Term Debt | 0.098 | 0.097 | 0.089 | 0.083 | 0.086 | 3.6% |
| Long Term Debt | 0.500 | 0.402 | 0.288 | 0.187 | 0.107 | -42.8% |
Cash flow
|
|---|
| Capex | 0.231 | 0.377 | 0.473 | 1.853 | | -100.0% |
Ratios
|
|---|
| Revenue growth | 26.2% | -15.3% | 8.9% | 18.0% | -3.5% | |
| EBITDA growth | -62.0% | 49.6% | -7.0% | 25.1% | 48.1% | |
| Gross Margin | 38.6% | 38.1% | 34.6% | 32.7% | 34.4% | 1.6% |
| EBITDA Margin | -6.6% | -11.6% | -9.9% | -10.5% | -16.2% | -5.6% |
| Net Income Margin | -2.1% | 2.4% | -5.0% | -9.1% | -10.1% | -1.1% |
| SG&A, % of revenue | 17.4% | 20.3% | 18.4% | 16.8% | 21.8% | 5.0% |
| CAPEX, % of revenue | 0.4% | 0.7% | 0.8% | 2.6% | | -2.6% |
| ROIC | -5.3% | -6.6% | -5.8% | -7.3% | -11.6% | -4.2% |
| ROE | -1.2% | 1.1% | -2.6% | -5.8% | -6.6% | -0.9% |
Revenue and profitability
Solomon Systech International Ltd's Revenue decreased on 3.5%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 5.6 pp from -10.5% to -16.2% in FY2016.
Gross Margin increased slightly on 1.6 pp from 32.7% to 34.4% in FY2016. SG&A as a % of Revenue increased on 5.0 pp from 16.8% to 21.8% in FY2016.
Net Income marign decreased slightly on 1.1 pp from -9.1% to -10.1% in FY2016.
Return on investment
The company operates at negative ROIC (-11.58%) and ROE (-6.62%). ROIC decreased on 4.2 pp from -7.3% to -11.6% in FY2016. ROE decreased slightly on 0.86 pp from -5.8% to -6.6% in FY2016.
Leverage (Debt)
Debt level is -6.0x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA didn't change in FY2016. Debt dropped on 28.5% while cash decreased on 5.9%.
Appendix 1: Peers in Semiconductors
Below we provide Solomon Systech International Ltd benchmarking against other companies in Semiconductors 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 |
|---|
| Phoenitron Holdings Ltd ($8066) | -7.2% | 4.0% | 243.8% | 405.3% | |
| Jun Yang Solar Power Investments Ltd ($397) | -81.0% | 256.8% | 1.1% | 168.9% | |
| Honbridge Holdings Ltd ($8137) | -76.4% | -97.5% | 608.9% | 57.0% | |
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | 15.5% | 16.0% | 3.3% | 23.2% | |
| Shunfeng International Clean Energy Ltd ($1165) | -46.3% | 44.4% | 275.6% | 22.4% | |
| |
|---|
| Median (22 companies) | -25.6% | 3.8% | 11.7% | -0.6% | 8.6% |
|---|
| Solomon Systech International Ltd ($2878) | | -15.3% | 8.9% | 18.0% | -3.5% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jun Yang Solar Power Investments Ltd ($397) | 87.3% | 79.3% | 53.8% | 73.8% | |
| Intel Corp ($4335) | 62.1% | 59.8% | 63.7% | 62.6% | 60.9% |
| PacMOS Technologies Holdings Ltd ($1010) | 68.8% | 65.7% | 65.7% | 57.5% | |
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | 47.7% | 48.7% | 47.5% | 52.9% | |
| Shenzhen Mingwah Aohan High Technology Corp Ltd ($8301) | 26.1% | 26.7% | 16.3% | 52.8% | |
| |
|---|
| Median (22 companies) | 22.1% | 23.7% | 29.5% | 31.3% | 34.1% |
|---|
| Solomon Systech International Ltd ($2878) | 38.6% | 38.1% | 34.6% | 32.7% | 34.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Ruifeng Renewable Energy Ltd ($527) | 9.1% | 37.2% | 88.0% | 78.3% | |
| Intel Corp ($4335) | 41.5% | 38.6% | 42.8% | 41.0% | 34.8% |
| Jun Yang Solar Power Investments Ltd ($397) | -218.5% | -16.7% | -9.9% | 35.0% | |
| Semiconductor Manufacturing International Corp ($981) | 34.3% | 35.5% | 34.5% | 33.3% | |
| Hua Hong Semiconductor Ltd ($1347) | 38.5% | 29.7% | 31.5% | 30.0% | 32.6% |
| |
|---|
| Median (22 companies) | 9.3% | 9.5% | 7.1% | 9.1% | 20.3% |
|---|
| Solomon Systech International Ltd ($2878) | -6.6% | -11.6% | -9.9% | -10.5% | -16.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Heng Xin China Holdings Ltd ($8046) | 16.1% | 4.1% | 11.9% | 110.8% | |
| Jun Yang Solar Power Investments Ltd ($397) | 671.1% | 25.9% | 78.9% | 104.2% | |
| China Ruifeng Renewable Energy Ltd ($527) | 5.5% | 35.9% | 10.6% | 60.9% | |
| Semiconductor Manufacturing International Corp ($981) | 23.5% | 35.1% | 33.2% | 55.0% | |
| Hanergy Thin Film Power Group Ltd ($566) | 1.3% | 2.8% | 4.8% | 32.0% | |
| |
|---|
| Median (22 companies) | 4.7% | 5.5% | 7.0% | 6.8% | 9.3% |
|---|
| Solomon Systech International Ltd ($2878) | 0.4% | 0.7% | 0.8% | 2.6% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Shanghai Fudan Microelectronics Group Co Ltd ($1385) | 25.5% | 22.7% | 21.1% | 20.9% | |
| Intel Corp ($4335) | 23.7% | 17.1% | 20.6% | 17.7% | 14.5% |
| Applied Materials Inc ($4336) | 4.0% | 4.6% | 15.9% | 15.2% | 19.1% |
| ASM Pacific Technology Ltd ($522) | 12.3% | 9.2% | 21.9% | 13.7% | 18.0% |
| Hua Hong Semiconductor Ltd ($1347) | 5.3% | 4.8% | 7.8% | 6.7% | 9.1% |
| |
|---|
| Median (22 companies) | -0.8% | 0.6% | 3.1% | 0.8% | 9.1% |
|---|
| Solomon Systech International Ltd ($2878) | -5.3% | -6.6% | -5.8% | -7.3% | -11.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Solargiga Energy Holdings Ltd ($757) | | 13.8x | 4.4x | 9.0x | |
| China Ruifeng Renewable Energy Ltd ($527) | 16.4x | 6.9x | 4.9x | 7.3x | |
| Shunfeng International Clean Energy Ltd ($1165) | | 25.8x | 3.4x | 5.7x | |
| Semiconductor Manufacturing International Corp ($981) | 1.3x | 1.0x | 1.0x | 0.5x | |
| Intel Corp ($4335) | 0.2x | 0.4x | 0.5x | 0.3x | 1.0x |
| |
|---|
| Median (12 companies) | 0.2x | 0.4x | 0.2x | 0.1x | -0.0x |
|---|
