Welling Holding Ltd EBITDA jumped on 32.7% in 2016 and EBITDA Margin increased on 2.9 pp from 8.6% to 11.5%
17/03/2017 • About Welling Holding Ltd (
$382) • By InTwits
Welling Holding Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts: The company has highly profitable business model: ROIC is at 14.3%.
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Welling Holding Ltd ($382) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 7,788 | 8,882 | 9,273 | 8,040 | 7,954 | -1.1% |
| Gross Profit | 1,224 | 1,422 | 1,424 | 1,110 | 1,178 | 6.2% |
| SG&A | 498 | 501 | 555 | 631 | 586 | -7.2% |
| EBITDA | 928 | 1,134 | 999 | 690 | 916 | 32.7% |
| Net Income | 640 | 785 | 678 | 525 | 597 | 13.6% |
Balance Sheet
|
|---|
| Cash | 826 | 1,825 | 1,940 | 1,236 | 1,661 | 34.4% |
| Short Term Debt | 307 | 341 | 88 | 21 | 685 | 3,215.2% |
| Long Term Debt | 129 | 43 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 331 | 203 | 275 | 215 | | -100.0% |
Ratios
|
|---|
| Revenue growth | -25.8% | 14.1% | 4.4% | -13.3% | -1.1% | |
| EBITDA growth | 2.4% | 22.2% | -12.0% | -30.9% | 32.7% | |
| Gross Margin | 15.7% | 16.0% | 15.4% | 13.8% | 14.8% | 1.0% |
| EBITDA Margin | 11.9% | 12.8% | 10.8% | 8.6% | 11.5% | 2.9% |
| Net Income Margin | 8.2% | 8.8% | 7.3% | 6.5% | 7.5% | 1.0% |
| SG&A, % of revenue | 6.4% | 5.6% | 6.0% | 7.8% | 7.4% | -0.5% |
| CAPEX, % of revenue | 4.3% | 2.3% | 3.0% | 2.7% | | -2.7% |
| ROIC | 23.5% | 24.3% | 18.7% | 10.7% | 14.3% | 3.6% |
| ROE | 23.1% | 22.9% | 16.8% | 12.2% | 13.5% | 1.3% |
| Net Debt/EBITDA | -0.4x | -1.3x | -1.9x | -1.8x | -1.1x | 0.7x |
Revenue and profitability
Welling Holding Ltd's Revenue decreased slightly on 1.1%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased on 2.9 pp from 8.6% to 11.5% in FY2016.
Gross Margin increased slightly on 1.0 pp from 13.8% to 14.8% in FY2016. SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased slightly on 0.97 pp from 6.5% to 7.5% in FY2016.
Return on investment
The company operates at good ROIC (14.33%) and ROE (13.47%). ROIC increased on 3.6 pp from 10.7% to 14.3% in FY2016. ROE increased slightly on 1.3 pp from 12.2% to 13.5% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is -1.1x and Debt / EBITDA is 0.7x. Net Debt / EBITDA jumped on 0.7x from -1.8x to -1.1x in FY2016. Debt surged on 3,215% while cash jumped on 34.4%.
Appendix 1: Peers in Home Furnishings
Below we provide Welling Holding Ltd benchmarking against other companies in Home Furnishings 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 |
|---|
| BEP International Holdings Ltd ($2326) | | -41.5% | 46.2% | 187.9% | 258.0% |
| See Corp Ltd ($491) | | -31.9% | 134.1% | 126.9% | -80.4% |
| Sunrise China Technology Group Ltd ($8226) | -93.0% | 21.9% | -20.4% | 77.5% | |
| Yuxing InfoTech Investment Holdings Ltd ($8005) | 29.6% | -21.2% | -16.5% | 21.3% | |
| Aupu Group Holding Co Ltd ($477) | 5.7% | 9.0% | 26.4% | 18.5% | |
| |
|---|
| Median (27 companies) | -0.2% | 4.8% | 1.7% | -0.8% | -1.0% |
|---|
| Welling Holding Ltd ($382) | | 14.1% | 4.4% | -13.3% | -1.1% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| South East Group Ltd ($726) | 25.5% | 51.6% | 38.8% | 82.4% | |
| Aupu Group Holding Co Ltd ($477) | 48.6% | 45.0% | 47.8% | 48.7% | |
| Grande Holdings Ltd/The ($186) | 23.7% | 25.4% | 29.0% | 27.7% | |
| Samson Holding Ltd ($531) | 25.6% | 25.4% | 27.3% | 27.3% | |
| Gold Peak Industries Holding Ltd ($40) | 25.8% | 23.6% | 24.9% | 25.6% | 25.6% |
| |
|---|
| Median (27 companies) | 20.3% | 18.7% | 17.1% | 16.7% | 21.9% |
|---|
| Welling Holding Ltd ($382) | 15.7% | 16.0% | 15.4% | 13.8% | 14.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Aupu Group Holding Co Ltd ($477) | 15.3% | 17.6% | 30.1% | 27.0% | |
| Skyworth Digital Holdings Ltd ($751) | 6.0% | 6.1% | 5.7% | 11.3% | 8.5% |
| Hing Lee HK Holdings Ltd ($396) | -3.0% | 4.3% | 9.4% | 8.2% | |
| Raymond Industrial Ltd ($229) | 7.6% | 7.7% | 7.8% | 6.3% | |
| Allan International Holdings ($684) | 8.0% | 7.6% | 7.6% | 6.3% | 6.8% |
| |
|---|
| Median (26 companies) | 5.0% | 4.5% | 4.5% | 3.1% | 5.6% |
|---|
| Welling Holding Ltd ($382) | 11.9% | 12.8% | 10.8% | 8.6% | 11.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| JF Household Furnishings Ltd ($776) | 0.7% | 4.5% | 2.8% | 54.5% | |
| Sunrise China Technology Group Ltd ($8226) | 126.4% | 69.3% | 7.4% | 14.1% | |
| Royale Furniture Holdings Ltd ($1198) | | 14.1% | 16.5% | 10.5% | |
| South East Group Ltd ($726) | 0.0% | 0.0% | 0.0% | 7.9% | |
| Aupu Group Holding Co Ltd ($477) | 1.5% | 6.3% | 5.3% | 5.7% | |
| |
|---|
| Median (27 companies) | 1.4% | 1.6% | 2.8% | 2.0% | 3.6% |
|---|
| Welling Holding Ltd ($382) | 4.3% | 2.3% | 3.0% | 2.7% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Aupu Group Holding Co Ltd ($477) | 14.8% | 17.0% | 32.2% | 32.2% | |
| Mastercraft International Holdings Ltd ($8146) | 54.4% | 38.6% | 36.4% | 23.2% | |
| Skyworth Digital Holdings Ltd ($751) | 11.6% | 13.4% | 10.9% | 23.0% | 13.7% |
| BEP International Holdings Ltd ($2326) | 90.3% | 4.7% | -4.5% | 17.6% | 29.4% |
| Tonly Electronics Holdings Ltd ($1249) | 4.2% | 7.1% | 15.9% | 11.7% | |
| |
|---|
| Median (27 companies) | 3.7% | 4.5% | 3.9% | 0.9% | 3.4% |
|---|
| Welling Holding Ltd ($382) | 23.5% | 24.3% | 18.7% | 10.7% | 14.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Kasen International Holdings Ltd ($496) | 2.2x | 3.7x | 44.9x | 20.1x | |
| Hisense Kelon Electrical Holdings Co Ltd ($921) | 1.2x | 0.9x | 1.0x | 6.4x | |
| Gold Peak Industries Holding Ltd ($40) | 10.2x | 3.4x | 3.6x | 2.8x | 3.9x |
| TCL Multimedia Technology Holdings Ltd ($1070) | -0.3x | -2.3x | 0.7x | 0.5x | |
| Skyworth Digital Holdings Ltd ($751) | 1.2x | 1.5x | 1.2x | -0.2x | 0.9x |
| |
|---|
| Median (16 companies) | -0.3x | -0.9x | -1.7x | -0.9x | -1.6x |
|---|
| Welling Holding Ltd ($382) | -0.4x | -1.3x | -1.9x | -1.8x | -1.1x |
