Shougang Concord Century Holdings Ltd reports 16.1 pp EBITDA Margin growth from -4.0% to 12.0% in 2016 in 2016 and 15.0% Revenue growth
23/03/2017 • About Shougang Concord Century Holdings Ltd (
$103) • By InTwits
Shougang Concord Century Holdings Ltd reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- EBITDA Margin is quite volatile: 12.0% in FY2016, -4.0% in FY2015, 5.2% in FY2014, 11.2% in FY2013, -0.2% in FY2012
- The company has potentially unprofitable business model: ROIC is at 3.3%
- It operates with high leverage: Net Debt/EBITDA is 2.9x while industry average is 2.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Shougang Concord Century Holdings Ltd ($103) key annual financial indicators
| mln. HKD | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 1,688 | 1,858 | 1,787 | 1,481 | 1,703 | 15.0% |
| Gross Profit | 16 | 214 | 134 | 19 | 215 | 1,031.7% |
| SG&A | 124 | 123 | 125 | 119 | 122 | 2.0% |
| EBITDA | -4 | 209 | 93 | -60 | 205 | |
| Net Income | -300 | -17 | -276 | -377 | 10 | |
Balance Sheet
|
|---|
| Cash | 176 | 124 | 69 | 210 | 307 | 46.4% |
| Short Term Debt | 948 | 1,100 | 1,294 | 919 | 901 | -2.0% |
| Long Term Debt | 437 | 322 | 0 | 199 | 0 | -100.0% |
Cash flow
|
|---|
| Capex | 106 | 10 | 19 | 5 | | -100.0% |
Ratios
|
|---|
| Revenue growth | -4.9% | 10.0% | -3.8% | -17.2% | 15.0% | |
| EBITDA growth | -102.5% | -5,370.5% | -55.4% | -164.0% | -444.8% | |
| Gross Margin | 1.0% | 11.5% | 7.5% | 1.3% | 12.6% | 11.4% |
| EBITDA Margin | -0.2% | 11.2% | 5.2% | -4.0% | 12.0% | 16.1% |
| Net Income Margin | -17.8% | -0.9% | -15.4% | -25.5% | 0.6% | 26.1% |
| SG&A, % of revenue | 7.3% | 6.6% | 7.0% | 8.1% | 7.1% | -0.9% |
| CAPEX, % of revenue | 6.3% | 0.5% | 1.1% | 0.3% | | -0.3% |
| ROIC | -4.8% | 1.6% | -1.9% | -6.7% | 3.3% | 10.1% |
| ROE | -13.6% | -0.8% | -13.8% | -23.1% | 0.7% | 23.9% |
| Net Debt/EBITDA | | 6.2x | 13.2x | | 2.9x | 2.9x |
Revenue and profitability
The company's Revenue surged on 15.0%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 14.8 pp from 26.9% to 12.1% in FY2016.
Gross Margin jumped on 11.4 pp from 1.3% to 12.6% in FY2016. SG&A as a % of Revenue decreased slightly on 0.92 pp from 8.1% to 7.1% in FY2016.
Net Income marign jumped on 26.1 pp from -25.5% to 0.59% in FY2016.
Return on investment
The company operates at low ROIC (3.34%) and ROE (0.74%). ROIC surged on 10.1 pp from -6.7% to 3.3% in FY2016. ROE surged on 23.9 pp from -23.1% to 0.74% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.9x and Debt / EBITDA is 4.4x. Net Debt / EBITDA surged2.9x from to 2.9x in FY2016. Debt dropped on 19.5% while cash surged on 46.4%.
Appendix 1: Peers in Metal Fabricate/Hardware
Below we provide Shougang Concord Century Holdings Ltd benchmarking against other companies in Metal Fabricate/Hardware 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 |
|---|
| EVA Precision Industrial Holdings Ltd ($838) | 19.7% | 12.2% | 30.1% | 2.3% | |
| China Zhongwang Holdings Ltd ($1333) | 31.0% | 6.0% | 11.6% | 1.3% | |
| Ka Shui International Holdings Ltd ($822) | 31.7% | 15.1% | -12.4% | -2.7% | |
| Shengli Oil & Gas Pipe Holdings Ltd ($1080) | 5.4% | 33.1% | -21.4% | -2.7% | |
| Lung Kee Bermuda Holdings ($255) | -5.2% | -7.5% | 8.2% | -5.2% | |
| |
|---|
| Median (8 companies) | 10.8% | 9.1% | 9.9% | -4.0% | |
|---|
| Shougang Concord Century Holdings Ltd ($103) | | 10.0% | -3.8% | -17.2% | 15.0% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 24.2% | 26.8% | 28.0% | 32.9% | |
| EVA Precision Industrial Holdings Ltd ($838) | 21.6% | 24.1% | 26.2% | 26.5% | |
| Ka Shui International Holdings Ltd ($822) | 22.5% | 22.1% | 19.6% | 19.0% | |
| Chu Kong Petroleum & Natural Gas Steel Pipe Holdings Ltd ($1938) | 17.0% | 15.4% | 11.6% | 16.0% | |
| New Times Energy Corp Ltd ($166) | -2.7% | 0.8% | 22.6% | 4.6% | |
| |
|---|
| Median (7 companies) | 17.0% | 15.4% | 19.6% | 16.0% | |
|---|
| Shougang Concord Century Holdings Ltd ($103) | 1.0% | 11.5% | 7.5% | 1.3% | 12.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 22.3% | 24.3% | 24.2% | 29.1% | |
| Lung Kee Bermuda Holdings ($255) | 15.3% | 14.8% | 11.7% | 15.2% | |
| EVA Precision Industrial Holdings Ltd ($838) | 10.4% | 9.9% | 16.7% | 14.9% | |
| Ka Shui International Holdings Ltd ($822) | 14.3% | 9.5% | 12.0% | 6.1% | |
| Burwill Holdings Ltd ($24) | -0.8% | -0.6% | -0.4% | -1.4% | |
| |
|---|
| Median (8 companies) | 11.7% | 7.7% | 5.6% | 2.4% | |
|---|
| Shougang Concord Century Holdings Ltd ($103) | -0.2% | 11.2% | 5.2% | -4.0% | 12.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 56.3% | 41.6% | 54.8% | 63.1% | |
| New Times Energy Corp Ltd ($166) | 11.4% | 1.7% | 52.1% | 61.1% | |
| Chu Kong Petroleum & Natural Gas Steel Pipe Holdings Ltd ($1938) | 25.9% | 71.7% | 31.4% | 17.1% | |
| EVA Precision Industrial Holdings Ltd ($838) | 9.2% | 6.3% | 6.3% | 8.0% | |
| Ka Shui International Holdings Ltd ($822) | 9.3% | 7.4% | 11.1% | 6.5% | |
| |
|---|
| Median (8 companies) | 11.5% | 8.1% | 11.0% | 7.3% | |
|---|
| Shougang Concord Century Holdings Ltd ($103) | 6.3% | 0.5% | 1.1% | 0.3% | |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 9.5% | 8.8% | 7.4% | 6.9% | |
| EVA Precision Industrial Holdings Ltd ($838) | 3.3% | 1.9% | 9.1% | 6.4% | |
| Lung Kee Bermuda Holdings ($255) | 6.7% | 4.9% | 3.2% | 4.8% | |
| Ka Shui International Holdings Ltd ($822) | 14.6% | 7.1% | 7.6% | 0.5% | |
| Chu Kong Petroleum & Natural Gas Steel Pipe Holdings Ltd ($1938) | 8.3% | 0.1% | -2.0% | -2.0% | |
| |
|---|
| Median (8 companies) | 5.0% | 1.9% | 0.8% | -0.8% | |
|---|
| Shougang Concord Century Holdings Ltd ($103) | -4.8% | 1.6% | -1.9% | -6.7% | 3.3% |
Top companies by Net Debt / EBITDA
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| China Zhongwang Holdings Ltd ($1333) | 1.3x | 2.6x | 4.1x | 6.2x | |
| Ka Shui International Holdings Ltd ($822) | 0.9x | 1.3x | 1.7x | 3.6x | |
| EVA Precision Industrial Holdings Ltd ($838) | 1.1x | 1.8x | 1.2x | 0.7x | |
| Lung Kee Bermuda Holdings ($255) | -1.5x | -1.6x | -0.9x | -1.4x | |
| |
|---|
| Median (4 companies) | 1.2x | 2.2x | 1.4x | 2.2x | |
|---|
