APAC Resources Ltd revenue returned to growth in FY2020: increased 300% vs. 30.0% decline a year earliner
28/09/2020 • About APAC Resources Ltd (
$1104) • By InTwits
APAC Resources Ltd reported FY2020 financial results today. Here are the key drivers of the company's long term financial model:
- APAC Resources Ltd is a growth stock: FY2020 revenue growth was 300%, 5 year revenue CAGR was 11.2% at FY2020 ROIC -15.3%
- The company operates at negative EBITDA Margin: -129.3%
- APAC Resources Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2016-FY2020 was 0.0% while average EBITDA Margin was -89.2% for the sames years
- APAC Resources Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.0%.
- In the last 5 years the company invested considerably less than D&A: 0 HKDm vs. 5 HKDm. In FY2020 this situation was still the same: CAPEX was 0 while D&A was 4
- The company has unprofitable business model: ROIC is -15.3%
- It operates with high leverage: Net Debt/EBITDA is 1.4x while industry average is 0.4x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
APAC Resources Ltd's Revenue surged on 300%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 55.8 pp from 59.5% to 3.7% in FY2020.
Gross Margin dropped on 41.1 pp from 52.6% to 11.4% in FY2020. SG&A as a % of Revenue dropped on 25.3 pp from 35.6% to 10.3% in FY2020.
Net Income margin dropped on 655 pp from 557% to -98.4% in FY2020.
Investments (CAPEX, working capital and M&A)
APAC Resources Ltd's CAPEX/Revenue was 0.043% in FY2020. APAC Resources Ltd's CAPEX/Revenue showed almost no change from FY2017 to FY2020.
Inventories as a % of Revenue dropped on 24.4 pp from 49.3% to 24.8% in FY2020.
Return on investment
The company operates at negative ROIC (-15.3%) and ROE (-11.5%). ROIC decreased on 7.1 pp from -8.2% to -15.3% in FY2020. ROE dropped on 28.7 pp from 17.2% to -11.5% in FY2020. During FY2016-FY2020 ROIC topped in FY2018 at 4.5% and was declining since that time.
Leverage (Debt)
Debt level is 1.4x Net Debt / EBITDA and Debt / EBITDA. Debt surged while cash dropped on 30.8%.
APAC Resources Ltd has no short term refinancing risk: cash is higher than short term debt (15,069.2%).
The company paid 122 HKD despite negative Net Income of -429 HKD in FY2020.
Management team
The company has 0.0062% shares owned by insiders. Insider ownership didn't change in 2020.
The company has 14 employees. The number of employees didn't change in 2020. Average revenue per employee in FY2020 was 31,180,500 HKD and it jumped on 300%.
Financial and operational results
FY ended 30/06/2020
APAC Resources Ltd ($1104) key annual financial indicators| mln. HKD | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 123.1 | 100.5 | 156.1 | 109.2 | 436.5 | 299.7% |
| Gross Profit | 26.3 | 5.5 | 41.3 | 57.4 | 49.9 | -13.1% |
| SG&A | 36.1 | 33.7 | 40.4 | 38.9 | 45.0 | 15.8% |
| EBITDA | -104.4 | -0.7 | 133.7 | -289.7 | -564.3 | |
| EBIT | | -1.2 | 133.4 | -290.1 | -568.7 | |
| Interest expence | | | 0.5 | 2.0 | | |
| Tax | | 68.8 | -7.0 | 0.8 | -0.0 | -100.1% |
| Net Income | -16.8 | 548.6 | 328.1 | 608.4 | -429.4 | -170.6% |
Balance Sheet
|
|---|
| Cash | 149.3 | 805.7 | 408.7 | 814.5 | 564.0 | -30.8% |
| Inventory | | | | 53.8 | 108.4 | 101.4% |
| Short Term Debt | 0.0 | 0.0 | 43.5 | 0.0 | 3.7 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.8 | |
Cash flow
|
|---|
| Capex | 0.0 | 0.0 | 0.0 | 0.0 | 0.2 | |
| Dividends | | | 14.0 | 27.0 | 122.0 | 351.9% |
Ratios
|
|---|
| Revenue growth | -52.0% | -18.4% | 55.4% | -30.0% | 299.7% | |
| EBITDA growth | 406.5% | -99.3% | -18,675.8% | -316.6% | 94.8% | |
|
|---|
| Gross Margin | 21.3% | 5.5% | 26.4% | 52.6% | 11.4% | -41.1% |
| EBITDA Margin | -84.8% | -0.7% | 85.7% | -265.3% | -129.3% | 136.0% |
| EBIT Margin | | -1.1% | 85.4% | -265.6% | -130.3% | 135.3% |
| SG&A, % of revenue | 29.3% | 33.6% | 25.9% | 35.6% | 10.3% | -25.3% |
| Net Income Margin | -13.7% | 546.0% | 210.2% | 557.0% | -98.4% | -655.4% |
| CAPEX, % of revenue | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | |
|
|---|
| ROIC | -5.0% | -0.0% | 4.5% | -8.2% | -15.3% | -7.1% |
| ROE | -0.8% | 21.5% | 11.0% | 17.2% | -11.5% | -28.7% |
| Net Debt/EBITDA | | | -2.7x | | |
| Interest expence / Average debt | | | 1.2% | | | |
People
|
|---|
| Insider ownership | | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| Employees | | 18 | 14 | 14 | 14 | 0.0% |
| Revenue/Employee, th. HKD | | 5,582 | 11,151 | 7,802 | 31,181 | 299.7% |
Peers in Distribution/Wholesale
Below you can find APAC Resources Ltd benchmarking vs. other companies in Distribution/Wholesale industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Goldin Financial Holdings Ltd ($530) | 8.7% | 8.8% | 6.0% | 3.9% | - |
| |
|---|
| Median (1 company) | -6.5% | 8.8% | 6.0% | 3.9% | - |
|---|
| APAC Resources Ltd ($1104) | -5.0% | -0.0% | 4.5% | -8.2% | -15.3% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Goldin Financial Holdings Ltd ($530) | 5.4x | 5.7x | 7.9x | 9.0x | - |
| |
|---|
| Median (1 company) | 1.8x | 5.7x | 7.9x | 9.0x | - |
|---|
