Time Watch Investments Ltd Net Income dropped on 70.1% and Revenue dropped on 35.3%
28/09/2020 • About Time Watch Investments Ltd (
$2033) • By InTwits
Time Watch Investments Ltd reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Time Watch Investments Ltd is a company in decline: FY2020 revenue growth was -35.3%, 5 years revenue CAGR was -8.2%
- The company has potentially unprofitable business model: ROIC is 6.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Time Watch Investments Ltd's Revenue dropped on 35.3%. During FY2016-FY2020 Revenue growth topped in FY2018 at 7.2% and was decelerating since that time. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased slightly on 1.6 pp from 15.7% to 14.1% in FY2020.
Gross Margin increased on 3.1 pp from 70.6% to 73.7% in FY2020. Gross Margin stuck to a growing trend at 1.4 pp per annum in FY2016-FY2020. SG&A as a % of Revenue increased on 5.7 pp from 58.8% to 64.5% in FY2020. SG&A as a % of Revenue stuck to a growing trend at 1.9 pp per annum in the last 5 years.
Net Income margin decreased on 6.1 pp from 11.4% to 5.3% in FY2020.
Return on investment
The company operates at low ROIC (6.6%) and ROE (4.2%). ROIC decreased on 7.7 pp from 14.4% to 6.6% in FY2020. ROE decreased on 10.0 pp from 14.1% to 4.2% in FY2020.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.7x and Debt / EBITDA is 0.1x. Debt dropped on 86.0% while cash surged on 64.5%.
Time Watch Investments Ltd has no short term refinancing risk: cash is higher than short term debt (3,437.9%).
Valuation and dividends
Time Watch Investments Ltd's trades at EV/EBITDA 4.0x and P/E 18.0x.
Financial and operational results
Time Watch Investments Ltd ($2033) key annual financial indicators| mln. HKD | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 2,607 | 2,763 | 2,962 | 2,670 | 1,726 | -35.3% |
| Gross Profit | 1,784 | 1,849 | 2,079 | 1,885 | 1,273 | -32.5% |
| SG&A | 1,450 | 1,580 | 1,694 | 1,570 | 1,113 | -29.1% |
| EBITDA | 428 | 372 | 458 | 420 | 244 | -41.9% |
| Net Income | 296 | 236 | 291 | 305 | 91 | -70.1% |
Balance Sheet
|
|---|
| Cash | 498 | 659 | 762 | 422 | 694 | 64.5% |
| Short Term Debt | 61 | 68 | 208 | 212 | 20 | -90.5% |
| Long Term Debt | 50 | 115 | 0 | 0 | 10 | |
Cash flow
|
|---|
| Capex | 94 | 81 | 111 | 139 | | |
Ratios
|
|---|
| Revenue growth | -1.7% | 6.0% | 7.2% | -9.9% | -35.3% | |
| EBITDA growth | -21.1% | -13.1% | 23.1% | -8.4% | -41.9% | |
|
|---|
| Gross Margin | 68.5% | 66.9% | 70.2% | 70.6% | 73.7% | 3.1% |
| EBITDA Margin | 16.4% | 13.5% | 15.5% | 15.7% | 14.1% | -1.6% |
| SG&A, % of revenue | 55.6% | 57.2% | 57.2% | 58.8% | 64.5% | 5.7% |
| Net Income Margin | 11.4% | 8.5% | 9.8% | 11.4% | 5.3% | -6.1% |
| CAPEX, % of revenue | 3.6% | 2.9% | 3.8% | 5.2% | | |
|
|---|
| ROIC | 18.6% | 14.2% | 16.7% | 14.4% | 6.6% | -7.7% |
| ROE | 17.5% | 13.0% | 14.7% | 14.1% | 4.2% | -10.0% |
| Net Debt/EBITDA | -0.9x | -1.3x | -1.2x | -0.5x | -2.7x | -2.2x |
Peers in Miscellaneous Manufactur
Below we provide Time Watch Investments Ltd benchmarking against other companies in Miscellaneous Manufactur 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 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Continental Holdings Ltd ($513) | -24.4% | 13.5% | -37.5% | 12.5% | - |
| VS International Group Ltd ($1002) | - | 43.7% | -12.2% | -41.8% | -25.7% |
| |
|---|
| Median (2 companies) | 6.9% | 28.6% | -24.9% | -14.7% | -25.7% |
|---|
| Time Watch Investments Ltd ($2033) | - | 6.0% | 7.2% | -9.9% | -35.3% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Continental Holdings Ltd ($513) | 15.7% | 17.8% | 19.8% | 24.7% | - |
| VS International Group Ltd ($1002) | 16.9% | 16.8% | 13.4% | 4.4% | 12.4% |
| |
|---|
| Median (2 companies) | 21.1% | 17.3% | 16.6% | 14.5% | 12.4% |
|---|
| Time Watch Investments Ltd ($2033) | 68.5% | 66.9% | 70.2% | 70.6% | 73.7% |
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Continental Holdings Ltd ($513) | -2.8% | 0.3% | 106.7% | 9.2% | - |
| VS International Group Ltd ($1002) | 4.7% | 8.1% | 5.8% | -7.9% | 0.9% |
| |
|---|
| Median (2 companies) | 7.9% | 4.2% | 56.3% | 0.7% | 0.9% |
|---|
| Time Watch Investments Ltd ($2033) | 16.4% | 13.5% | 15.5% | 15.7% | 14.1% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Continental Holdings Ltd ($513) | 3.8% | 1.7% | 4.0% | 5.1% | - |
| VS International Group Ltd ($1002) | 5.4% | 8.1% | 8.2% | 1.0% | - |
| |
|---|
| Median (2 companies) | 3.8% | 4.9% | 6.1% | 3.0% | - |
|---|
| Time Watch Investments Ltd ($2033) | 3.6% | 2.9% | 3.8% | 5.2% | - |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Continental Holdings Ltd ($513) | -0.9% | -0.3% | 14.4% | 1.1% | - |
| VS International Group Ltd ($1002) | -1.1% | 6.9% | 2.0% | -15.5% | -3.8% |
| |
|---|
| Median (2 companies) | 7.5% | 3.3% | 8.2% | -7.2% | -3.8% |
|---|
| Time Watch Investments Ltd ($2033) | 18.6% | 14.2% | 16.7% | 14.4% | 6.6% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VS International Group Ltd ($1002) | 4.6x | 1.6x | 1.6x | - | 16.2x |
| |
|---|
| Median (1 company) | -0.6x | -77.1x | 0.2x | 3.1x | 16.2x |
|---|
| Time Watch Investments Ltd ($2033) | -0.9x | -1.3x | -1.2x | -0.5x | -2.7x |
