Applied Development Holdings Ltd revenue surged on 1,360% and EBITDA Margin surged on 277 pp from -378% to -101%
29/09/2020 • About Applied Development Holdings Ltd (
$519) • By InTwits
Applied Development Holdings Ltd reported FY2020 financial results today. Here are the key drivers of the company's long term financial model:
- Applied Development Holdings Ltd is a fast growth stock: FY2020 revenue growth was 1,360%, 5 year revenue CAGR was 148% at FY2020 ROIC -15.2%
- The company operates at negative EBITDA Margin: -100.6%
- EBITDA Margin is quite volatile: -100.6% in FY2020, -377.5% in FY2019, 570.1% in FY2018, 2,015.5% in FY2017, 11.8% in FY2016
- Applied Development Holdings Ltd motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2016-FY2020 was 0.0% while average EBITDA Margin was -1.3% for the sames years
- Applied Development Holdings Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 137.8%. At the same time it's a lot of higher than industry average of 19.5%.
- CAPEX is quite volatile: 0 HKDm in FY2020, 1 HKDm in FY2019, 0 HKDm in FY2018, 0 HKDm in FY2017, 52 HKDm in FY2016
- The company has unprofitable business model: ROIC is -15.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 1,360%. During the last 5 years Revenue growth bottomed in FY2018 at -73.8% and was accelerating since that time. Revenue growth happened at the same time with EBITDA margin expansion. EBITDA Margin jumped on 277 pp from -378% to -101% in FY2020.
SG&A as a % of Revenue dropped on 189 pp from 204% to 14.9% in FY2020.
Net Income margin jumped on 354 pp from -457% to -103% in FY2020. Net Income margin followed a declining trend at -1,241 pp per annum in FY2016-FY2020.
Investments (CAPEX, working capital and M&A)
Applied Development Holdings Ltd's CAPEX/Revenue was 0.20% in FY2020. Applied Development Holdings Ltd's CAPEX/Revenue showed almost no change from FY2017 to FY2020. For the last three years the average CAPEX/Revenue was 1.7%.
Return on investment
The company operates at negative ROIC (-15.2%) and ROE (-21.1%). ROIC dropped on 11.9 pp from -3.4% to -15.2% in FY2020. ROE dropped on 15.5 pp from -5.6% to -21.1% in FY2020. During FY2016-FY2020 ROIC topped in FY2017 at 21.2% and was declining since that time. ROE stuck to a declining trend at -17.8 pp per annum in the last 5 years.
Leverage (Debt)
Debt level is -56.8x Net Debt / EBITDA and Debt / EBITDA. Debt dropped on 30.1% while cash jumped on 181%.
Applied Development Holdings Ltd has no short term refinancing risk: cash is higher than short term debt (101.2%).
Average interest expence charged on company's debt was 4.4% in FY2020.
Management team
Insider ownership is 11.2%. Insider ownership didn't change in 2020.
At the end of financial year the company had 28 employees. The number of employees dropped on 26.3%. Average revenue per employee in FY2020 was 8,870,857 HKD and it jumped on 1,882%.
Financial and operational results
FY ended 30/06/2020
Applied Development Holdings Ltd ($519) key annual financial indicators| mln. HKD | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 7.6 | 14.3 | 3.7 | 17.0 | 248.4 | 1,360.1% |
| Gross Profit | | | | | 25.1 | |
| SG&A | 13.2 | 15.6 | 28.0 | 34.7 | 36.9 | 6.4% |
| EBITDA | 0.9 | 288.1 | 21.3 | -64.2 | -249.8 | |
| EBIT | | 288.1 | 21.2 | -64.3 | -250.7 | |
| Interest expence | | 0.4 | 16.1 | 26.6 | 12.1 | -54.4% |
| Tax | | -0.0 | -1.8 | -0.5 | -1.8 | |
| Net Income | 370.0 | 291.0 | 10.6 | -77.8 | -255.1 | |
Balance Sheet
|
|---|
| Cash | 422.4 | 343.2 | 243.8 | 98.4 | 276.3 | 180.8% |
| Short Term Debt | 0.0 | 393.0 | 414.5 | 390.8 | 273.0 | -30.1% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.3 | |
Cash flow
|
|---|
| Capex | 52.1 | 0.0 | 0.0 | 0.7 | 0.5 | -27.8% |
Ratios
|
|---|
| Revenue growth | 187.4% | 87.5% | -73.8% | 354.5% | 1,360.1% | |
| EBITDA growth | -104.6% | 31,944.6% | -92.6% | -400.9% | 288.9% | |
|
|---|
| Gross Margin | | | | | 10.1% | |
| EBITDA Margin | 11.8% | 2,015.5% | 570.1% | -377.5% | -100.6% | 277.0% |
| EBIT Margin | | 2,015.4% | 566.5% | -378.2% | -100.9% | 277.2% |
| SG&A, % of revenue | 173.8% | 109.5% | 749.1% | 203.9% | 14.9% | -189.1% |
| Net Income Margin | 4,854.8% | 2,035.8% | 284.2% | -457.1% | -102.7% | 354.3% |
| CAPEX, % of revenue | 683.8% | 0.1% | 1.0% | 4.0% | 0.2% | -3.8% |
|
|---|
| ROIC | 0.0% | 21.2% | 1.1% | -3.4% | -15.2% | -11.9% |
| ROE | 51.6% | 26.4% | 0.8% | -5.6% | -21.1% | -15.5% |
| Net Debt/EBITDA | -469.9x | 0.2x | 8.0x | | |
| Interest expence / Average debt | | 0.2% | 4.0% | 6.6% | 4.4% | -2.2% |
People
|
|---|
| Insider ownership | | 11.2% | 11.2% | 11.2% | 11.2% | 0.0% |
| Employees | | 20 | 28 | 38 | 28 | -26.3% |
| Revenue/Employee, th. HKD | | 715 | 134 | 448 | 8,871 | 1,881.6% |
Peers in Electrical Compo&Equip
Below we provide Applied Development Holdings Ltd benchmarking against other companies in Electrical Compo&Equip 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 |
|---|
| Solartech International Hldgs Ltd ($1166) | - | -40.3% | -10.7% | -19.8% | -9.1% |
| |
|---|
| Median (1 company) | 3.1% | -40.3% | -10.7% | -19.8% | -9.1% |
|---|
| Applied Development Holdings Ltd ($519) | - | 87.5% | -73.8% | 354.5% | 1,360.1% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Solartech International Hldgs Ltd ($1166) | 6.7% | 8.3% | 9.6% | 10.0% | 11.1% |
| |
|---|
| Median (1 company) | 26.4% | 8.3% | 9.6% | 10.0% | 11.1% |
|---|
| Applied Development Holdings Ltd ($519) | - | - | - | - | 10.1% |
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Solartech International Hldgs Ltd ($1166) | -6.3% | -4.1% | -30.2% | -73.4% | -36.6% |
| |
|---|
| Median (1 company) | 5.6% | -4.1% | -30.2% | -73.4% | -36.6% |
|---|
| Applied Development Holdings Ltd ($519) | 11.8% | 2,015.5% | 570.1% | -377.5% | -100.6% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Solartech International Hldgs Ltd ($1166) | 3.7% | 1.3% | 0.9% | 11.7% | 3.3% |
| |
|---|
| Median (1 company) | 6.0% | 1.3% | 0.9% | 11.7% | 3.3% |
|---|
| Applied Development Holdings Ltd ($519) | 683.8% | 0.1% | 1.0% | 4.0% | 0.2% |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Solartech International Hldgs Ltd ($1166) | -4.0% | -2.4% | -8.7% | -17.2% | -9.3% |
| |
|---|
| Median (1 company) | 1.6% | -2.4% | -8.7% | -17.2% | -9.3% |
|---|
| Applied Development Holdings Ltd ($519) | 0.0% | 21.2% | 1.1% | -3.4% | -15.2% |
