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Odella Leather Holdings Ltd revenue returned to growth in FY2020: increased 60.4% vs. 48.6% decline a year earliner

30/09/2020 • About Odella Leather Holdings Ltd ($8093) • By InTwits

Odella Leather Holdings Ltd reported FY2020 financial results today. Overall the company's long term financial model is characterised by the following facts:
  • Odella Leather Holdings Ltd is a fast growth stock: FY2020 revenue growth was 60.4%, 5 year revenue CAGR was 39.6% at FY2020 ROIC -0.27%
  • The company has unprofitable business model: ROIC is -0.3%
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 60.4%.

Gross Margin dropped on 13.0 pp from 15.0% to 2.0% in FY2020. During the last 5 years Gross Margin topped in FY2018 at 48.8% and was declining since that time. SG&A as a % of Revenue decreased on 7.0 pp from 15.9% to 8.9% in FY2020.

Net Income margin surged on 12.2 pp from -13.5% to -1.3% in FY2020.

Investments (CAPEX, working capital and M&A)


Accounts receivable as a % of Revenue dropped on 33.0 pp from 41.9% to 8.9% in FY2020. Accounts payable as a % of Revenue decreased on 9.0 pp from 16.7% to 7.7% in FY2020.

Return on investment


The company operates at negative ROIC (-0.3%) and ROE (-2.8%). ROIC jumped on 14.3 pp from -14.6% to -0.27% in FY2020. ROE surged on 12.8 pp from -15.5% to -2.8% in FY2020.

Leverage (Debt)


Debt jumped on 169% while cash jumped on 155%.

Odella Leather Holdings Ltd has no short term refinancing risk: cash is higher than short term debt (138.5%).

Average interest expence charged on company's debt was 10.7% in FY2020.

Management team


The company has 60 employees. The number of employees dropped on 45.0%. Average revenue per employee in FY2020 was 7,238,567 HKD and it surged on 191%.

Financial and operational results


Odella Leather Holdings Ltd ($8093) key annual financial indicators

mln. HKD201620172018201920202020/2019
P&L
Revenue55.862.2526.3270.7434.360.4%
Gross Profit20.724.0256.940.68.5-79.0%
SG&A16.826.040.943.238.9-10.0%
EBITDA4.0-0.7212.7-35.1
EBIT-0.9211.4-36.8
Interest expence0.64.2616.0%
Tax2.07.71.8
Net Income3.8-2.8204.6-36.6-5.7
Balance Sheet
Cash49.041.6113.419.649.9155.0%
Accounts Receivable8.6226.4113.538.6-66.0%
Inventory7.68.8
Accounts Payable2.379.738.432.7-14.9%
Short Term Debt0.00.00.214.536.0148.0%
Long Term Debt0.00.00.30.23.61,994.7%
Cash flow
Capex0.30.84.61.1
Ratios
Revenue growth-31.8%11.4%746.4%-48.6%60.4%
EBITDA growth6.7%-116.8%-31,511.1%-116.5%

Gross Margin37.1%38.7%48.8%15.0%2.0%-13.0%
EBITDA Margin7.2%-1.1%40.4%-13.0%
EBIT Margin-1.5%40.2%-13.6%
SG&A, % of revenue30.1%41.8%7.8%15.9%8.9%-7.0%
Net Income Margin6.9%-4.4%38.9%-13.5%-1.3%12.2%
CAPEX, % of revenue0.6%1.3%0.9%0.4%

ROIC6.2%-1.5%127.8%-14.6%-0.3%14.3%
ROE6.4%-4.5%127.6%-15.5%-2.8%12.8%
Net Debt/EBITDA-12.1x-0.5x
Interest expence / Average debt7.8%10.7%2.9%
People
Employees19118810960-45.0%
Revenue/Employee, th. HKD3262,8002,4847,239191.4%

Peers in Apparel


Below we provide Odella Leather Holdings Ltd benchmarking against other companies in Apparel 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
Top Form International Ltd ($333)--4.5%13.8%-4.3%0.9%
Sitoy Group Holdings Ltd ($1023)--32.4%20.3%5.9%-25.9%
 
Median (2 companies)-3.9%-18.5%17.0%0.8%-12.5%
Odella Leather Holdings Ltd ($8093)-11.4%746.4%-48.6%60.4%


Top companies by Gross margin, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Sitoy Group Holdings Ltd ($1023)27.0%27.0%27.6%28.5%24.3%
Top Form International Ltd ($333)17.9%18.2%17.9%16.2%14.6%
 
Median (2 companies)19.1%22.6%22.8%22.3%19.4%
Odella Leather Holdings Ltd ($8093)37.1%38.7%48.8%15.0%2.0%


Top companies by EBITDA margin, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Sitoy Group Holdings Ltd ($1023)14.6%14.1%14.1%8.9%-0.1%
Top Form International Ltd ($333)4.8%2.1%2.7%-3.4%-2.2%
 
Median (2 companies)4.0%8.1%8.4%2.8%-1.2%
Odella Leather Holdings Ltd ($8093)7.2%-1.1%40.4%-13.0%-


Top companies by CAPEX/Revenue, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Top Form International Ltd ($333)1.1%3.0%2.5%3.4%5.5%
Sitoy Group Holdings Ltd ($1023)0.9%1.2%1.0%0.6%1.1%
 
Median (2 companies)2.1%2.1%1.7%2.0%3.3%
Odella Leather Holdings Ltd ($8093)0.6%1.3%0.9%0.4%-


Top companies by ROIC, %

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Sitoy Group Holdings Ltd ($1023)16.4%10.5%13.1%7.6%-4.6%
Top Form International Ltd ($333)5.8%0.6%1.9%-12.3%-12.3%
 
Median (2 companies)1.4%5.5%7.5%-2.3%-8.5%
Odella Leather Holdings Ltd ($8093)6.2%-1.5%127.8%-14.6%-0.3%


Top companies by Net Debt / EBITDA

Top  FY2016 FY2017 FY2018 FY2019 FY2020
Sitoy Group Holdings Ltd ($1023)-2.0x-2.2x-1.4x-1.1x-
 
Median (1 company)-0.6x-3.9x-2.2x-1.1x-