Sinopharm Group Co Ltd revenue growth continued to 13.8% in FY2016 vs. 13.5% a year earliner
24/03/2017 • About Sinopharm Group Co Ltd (
$1099) • By InTwits
Sinopharm Group Co Ltd reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Sinopharm Group Co Ltd is a fast growth stock: 2016 revenue growth was 13.8%, 5 year revenue CAGR was 20.4% at 2016 ROIC 13.5%
- EBITDA Margin is relatively stable: 4.4% in 2016 vs. 4.5% in 2015 vs. 4.0% in 2012
- Sinopharm Group Co Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.7%.
- The company has highly profitable business model: ROIC is at 13.5%
- It operates with high leverage: Net Debt/EBITDA is 0.7x while industry average is -1.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Sinopharm Group Co Ltd ($1099) key annual financial indicators
| mln. CNY | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 136,502 | 166,866 | 200,131 | 227,069 | 258,388 | 13.8% |
| Gross Profit | 10,988 | 13,379 | 16,328 | 18,618 | 20,671 | 11.0% |
| SG&A | 6,256 | 7,431 | 8,502 | 9,697 | 10,700 | 10.3% |
| EBITDA | 5,436 | 6,779 | 8,697 | 10,175 | 11,281 | 10.9% |
| Net Income | 1,979 | 2,250 | 2,875 | 3,761 | 4,647 | 23.6% |
Balance Sheet
|
|---|
| Cash | 9,802 | 14,002 | 15,232 | 19,919 | 25,573 | 28.4% |
| Short Term Debt | 10,948 | 21,007 | 25,233 | 28,204 | 22,363 | -20.7% |
| Long Term Debt | 5,192 | 4,134 | 4,223 | 608 | 11,135 | 1,730.9% |
Cash flow
|
|---|
| Capex | 1,422 | 1,224 | 1,645 | 1,080 | 1,229 | 13.9% |
Ratios
|
|---|
| Revenue growth | 33.5% | 22.2% | 19.9% | 13.5% | 13.8% | |
| EBITDA growth | 32.7% | 24.7% | 28.3% | 17.0% | 10.9% | |
| Gross Margin | 8.0% | 8.0% | 8.2% | 8.2% | 8.0% | -0.2% |
| EBITDA Margin | 4.0% | 4.1% | 4.3% | 4.5% | 4.4% | -0.1% |
| Net Income Margin | 1.5% | 1.3% | 1.4% | 1.7% | 1.8% | 0.1% |
| SG&A, % of revenue | 4.6% | 4.5% | 4.2% | 4.3% | 4.1% | -0.1% |
| CAPEX, % of revenue | 1.0% | 0.7% | 0.8% | 0.5% | 0.5% | 0.0% |
| ROIC | 13.0% | 12.9% | 12.9% | 13.3% | 13.5% | 0.2% |
| ROE | 12.0% | 11.5% | 11.7% | 13.1% | 15.0% | 1.9% |
| Net Debt/EBITDA | 1.2x | 1.6x | 1.6x | 0.9x | 0.7x | -0.2x |
Revenue and profitability
Sinopharm Group Co Ltd's Revenue surged on 13.8%. Despite revenue decline the EBITDA margin expanded. EBITDA Margin increased slightly on 0.77 pp from 9.8% to 10.5% in 2016.
Gross Margin showed almost no change in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign showed almost no change in 2016.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.48% in 2016. The company showed almost no change in CAPEX/Revenue from 2013 to 2016. For the last three years the average CAPEX/Revenue was 0.59%.
Return on investment
The company operates at good ROIC (13.51%) and ROE (15.01%). ROIC showed almost no change in 2016. ROE increased slightly on 1.9 pp from 13.1% to 15.0% in 2016.
Leverage (Debt)
Debt level is 0.7x Net Debt / EBITDA and 3.0x Debt / EBITDA. Net Debt / EBITDA dropped on 0.2x from 0.9x to 0.7x in 2016. Debt jumped on 16.3% while cash surged on 28.4%.
Appendix 1: Peers in Pharmaceuticals
Below we provide Sinopharm Group Co Ltd benchmarking against other companies in Pharmaceuticals 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 |
|---|
| China Health Group Inc ($8225) | | -48.0% | -60.1% | 244.1% | -1.2% |
| Wai Yuen Tong Medicine Holdings Ltd ($897) | | 45.9% | -10.5% | 105.6% | 40.9% |
| Oriental Unicorn Agricultural Group Ltd ($8120) | | -78.1% | 16.8% | 100.8% | 6.9% |
| China Traditional Chinese Medicine Co Ltd ($570) | | 35.2% | 90.0% | 40.0% | 76.1% |
| RM Group Holdings Ltd ($8185) | | 4.6% | -16.0% | 34.2% | -16.6% |
| |
|---|
| Median (42 companies) | 13.3% | 13.5% | 14.8% | 3.3% | 8.7% |
|---|
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Luye Pharma Group Ltd ($2186) | 83.5% | 83.6% | 81.0% | 81.4% | |
| Consun Pharmaceutical Group Ltd ($1681) | 75.7% | 79.1% | 78.3% | 80.7% | |
| Jilin Province Huinan Changlong Bio-pharmacy Co Ltd ($8049) | 82.0% | 81.5% | 80.9% | 79.9% | |
| RM Group Holdings Ltd ($8185) | 79.6% | 78.8% | 76.6% | 77.7% | 77.4% |
| Sino Biopharmaceutical Ltd ($1177) | 78.5% | 77.5% | 76.4% | 77.7% | 79.2% |
| |
|---|
| Median (41 companies) | 40.9% | 39.7% | 50.9% | 50.0% | 52.5% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 193.8% | 205,840.0% | -15,344.8% | 49,650.0% | 26.0% |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 38.8% | 65.4% | 70.9% | 93.3% | |
| Hua Han Bio-Pharmaceutical Holdings Ltd ($587) | 60.6% | 21.0% | 28.8% | 61.1% | |
| U-Home Group Holdings Ltd ($2327) | 9.8% | -16.6% | -46.7% | 51.7% | |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 41.3% | 45.4% | 47.5% | 49.1% | 50.9% |
| |
|---|
| Median (42 companies) | 20.3% | 20.2% | 21.4% | 20.0% | 11.9% |
|---|
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Hao Wen Holdings Ltd ($8019) | 30.0% | 2.3% | 38.2% | 44.8% | |
| Hua Han Bio-Pharmaceutical Holdings Ltd ($587) | 0.9% | 1.4% | 7.6% | 40.5% | |
| Lee's Pharmaceutical Holdings Ltd ($950) | 18.6% | 20.9% | 7.1% | 26.1% | |
| Tianda Pharmaceuticals Ltd ($455) | 6.0% | 3.9% | 10.5% | 24.4% | 22.9% |
| Lijun International Pharmaceutical Holding Co Ltd ($2005) | 16.8% | 52.4% | 39.6% | 18.7% | |
| |
|---|
| Median (41 companies) | 8.2% | 8.9% | 7.5% | 4.5% | 4.0% |
|---|
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Sino Biopharmaceutical Ltd ($1177) | 26.2% | 26.8% | 26.5% | 26.2% | 24.3% |
| Beijing Tong Ren Tang Chinese Medicine Co Ltd ($8138) | 25.3% | 27.5% | 23.8% | 25.9% | 25.1% |
| Sihuan Pharmaceutical Holdings Group Ltd ($460) | 13.7% | 18.3% | 22.0% | 25.4% | |
| Dawnrays Pharmaceutical Holdings Ltd ($2348) | 12.6% | 14.0% | 17.8% | 23.5% | |
| Lee's Pharmaceutical Holdings Ltd ($950) | 26.1% | 22.0% | 22.4% | 22.7% | |
| |
|---|
| Median (43 companies) | 12.2% | 9.3% | 10.6% | 10.0% | 6.4% |
|---|
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Northeast Tiger Pharmaceutical Corp Ltd ($8197) | 2.3x | 3.7x | | 22.2x | -5.1x |
| U-Home Group Holdings Ltd ($2327) | 10.1x | | | 9.9x | |
| Lansen Pharmaceutical Holdings Ltd ($503) | 1.7x | 2.8x | 3.4x | 4.7x | |
| China Grand Pharmaceutical and Healthcare Holdings Ltd ($512) | 5.4x | 4.0x | 3.4x | 4.3x | |
| United Laboratories International Holdings Ltd/The ($3933) | 6.5x | 4.6x | 4.2x | 4.0x | |
| |
|---|
| Median (35 companies) | -0.4x | -0.4x | -0.6x | -0.4x | -1.3x |
|---|
