Esprit Holdings Ltd revenue dropped on 28.7% and EBITDA Margin decreased on 8.9 pp from -12.3% to -21.2%
29/09/2020 • About Esprit Holdings Ltd (
$330) • By InTwits
Esprit Holdings Ltd reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Esprit Holdings Ltd is a company in decline: FY2020 revenue growth was -28.7%, 5 years revenue CAGR was -13.9%
- The company operates at negative EBITDA Margin: -21.2%
- Esprit 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 -6.9% for the sames years
- The company has unprofitable business model: ROIC is -47.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Esprit Holdings Ltd's Revenue dropped on 28.7%. Revenue decline was worsened by EBITDA margin decline. EBITDA Margin decreased on 8.9 pp from -12.3% to -21.2% in FY2020. EBITDA Margin stuck to a declining trend at -5.7 pp per annum in FY2016-FY2020.
Gross Margin decreased on 5.7 pp from 50.3% to 44.6% in FY2020. During the last 5 years Gross Margin topped in FY2017 at 51.6% and was declining since that time.
Net Income margin dropped on 26.7 pp from -16.6% to -43.3% in FY2020. Net Income margin stuck to a declining trend at -10.4 pp per annum in the last 5 years.
Return on investment
The company operates at negative ROIC (-47.3%) and ROE (-84.2%). ROIC dropped on 21.5 pp from -25.8% to -47.3% in FY2020. ROE dropped on 56.9 pp from -27.2% to -84.2% in FY2020. ROIC declined at -10.7 pp per annum in FY2016-FY2020. ROE followed a declining trend at -19.7 pp per annum in the last 5 years.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.3x and Debt / EBITDA is . Net Debt / EBITDA didn't change in FY2020. Debt jumped while cash dropped on 10.2%.
Esprit Holdings Ltd has no short term refinancing risk: cash is higher than short term debt (225.2%).
Management team
Anders Kristiansen is a Esprit Holdings Ltd's CEO. Anders Kristiansen has spent 2 years with the company. Johannes Georg Schmidt-Schultes is a Esprit Holdings Ltd's CFO. Johannes Georg Schmidt-Schultes has spent 1 year at the company.
Financial and operational results
Esprit Holdings Ltd ($330) key annual financial indicators| mln. HKD | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 17,788 | 15,942 | 15,455 | 12,932 | 9,216 | -28.7% |
| Gross Profit | 8,929 | 8,230 | 7,921 | 6,501 | 4,107 | -36.8% |
| SG&A | 2,037 | 1,771 | | | | |
| EBITDA | -74 | 438 | -1,726 | -1,586 | -1,953 | |
| Net Income | 21 | 67 | -2,554 | -2,144 | -3,992 | |
Balance Sheet
|
|---|
| Cash | 3,485 | 3,367 | 3,114 | 2,549 | 2,288 | -10.2% |
| Short Term Debt | 0 | 0 | 0 | 0 | 1,016 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 2,475 | |
Cash flow
|
|---|
| Capex | 262 | 257 | 305 | 163 | | |
Ratios
|
|---|
| Revenue growth | -8.4% | -10.4% | -3.1% | -16.3% | -28.7% | |
| EBITDA growth | -97.4% | -691.9% | -494.1% | -8.1% | 23.1% | |
|
|---|
| Gross Margin | 50.2% | 51.6% | 51.3% | 50.3% | 44.6% | -5.7% |
| EBITDA Margin | -0.4% | 2.7% | -11.2% | -12.3% | -21.2% | -8.9% |
| SG&A, % of revenue | 11.5% | 11.1% | | | | |
| Net Income Margin | 0.1% | 0.4% | -16.5% | -16.6% | -43.3% | -26.7% |
| CAPEX, % of revenue | 1.5% | 1.6% | 2.0% | 1.3% | | |
|
|---|
| ROIC | -6.0% | -1.2% | -22.4% | -25.8% | -47.3% | -21.5% |
| ROE | 0.2% | 0.6% | -24.8% | -27.2% | -84.2% | -56.9% |
| Net Debt/EBITDA | | -7.7x | | | |
Peers in Retail
Below we provide Esprit Holdings Ltd benchmarking against other companies in Retail 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 |
|---|
| Bossini International Hldg ($592) | - | -12.9% | -3.1% | -24.0% | -26.6% |
| New World Department Store China Ltd ($825) | - | -4.8% | 9.7% | -7.9% | -36.6% |
| Jintian Pharmaceutical Group Ltd ($2211) | - | -20.7% | -1.6% | -8.1% | -37.7% |
| |
|---|
| Median (3 companies) | -3.0% | -4.8% | 4.0% | -8.1% | -36.6% |
|---|
| Esprit Holdings Ltd ($330) | - | -10.4% | -3.1% | -16.3% | -28.7% |
Top companies by Gross margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Bossini International Hldg ($592) | 47.7% | 50.7% | 52.9% | 51.5% | 48.9% |
| Jintian Pharmaceutical Group Ltd ($2211) | 25.9% | 17.8% | 14.3% | 13.5% | 12.5% |
| |
|---|
| Median (2 companies) | 42.6% | 36.5% | 49.3% | 32.5% | 30.7% |
|---|
| Esprit Holdings Ltd ($330) | 50.2% | 51.6% | 51.3% | 50.3% | 44.6% |
Top companies by EBITDA margin, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| New World Department Store China Ltd ($825) | 15.7% | 15.9% | 10.8% | 12.0% | 18.4% |
| Bossini International Hldg ($592) | 5.6% | 2.9% | -1.1% | -6.0% | -9.3% |
| Jintian Pharmaceutical Group Ltd ($2211) | -0.7% | -19.3% | -31.7% | -10.6% | -30.9% |
| |
|---|
| Median (3 companies) | 6.8% | 7.2% | 4.9% | -6.0% | -9.3% |
|---|
| Esprit Holdings Ltd ($330) | -0.4% | 2.7% | -11.2% | -12.3% | -21.2% |
Top companies by CAPEX/Revenue, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| New World Department Store China Ltd ($825) | 5.5% | 4.9% | 3.9% | 3.3% | - |
| Bossini International Hldg ($592) | 2.4% | 0.8% | 1.2% | 1.9% | 1.8% |
| Jintian Pharmaceutical Group Ltd ($2211) | - | 4.3% | 1.9% | 0.1% | 6.3% |
| |
|---|
| Median (3 companies) | 2.2% | 2.5% | 1.7% | 1.9% | 4.1% |
|---|
| Esprit Holdings Ltd ($330) | 1.5% | 1.6% | 2.0% | 1.3% | - |
Top companies by ROIC, %
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| New World Department Store China Ltd ($825) | 3.3% | 3.6% | 1.9% | 2.5% | -2.0% |
| Jintian Pharmaceutical Group Ltd ($2211) | -2.4% | -21.0% | -40.8% | -15.1% | -33.3% |
| Bossini International Hldg ($592) | 7.8% | 1.5% | -5.6% | -14.7% | -45.9% |
| |
|---|
| Median (3 companies) | 6.9% | 3.6% | -1.8% | -14.7% | -33.3% |
|---|
| Esprit Holdings Ltd ($330) | -6.0% | -1.2% | -22.4% | -25.8% | -47.3% |
Top companies by Net Debt / EBITDA
| Top | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| New World Department Store China Ltd ($825) | -0.3x | -0.4x | -0.1x | -0.3x | 11.2x |
| |
|---|
| Median (1 company) | -0.6x | -1.6x | -0.9x | -0.3x | 11.2x |
|---|
