Solidere reports 177% Net Income decline and 124 pp EBITDA Margin decline from 48.1% to -76.2%
07 Jan 2016 • About Solidere (
$SLED) • By InTwits
Solidere reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Solidere is a company in decline: 2015 revenue growth was -59.8%, 5 years revenue CAGR was -25.0%
- EBITDA Margin is quite volatile: -76.2% in 2015, 48.1% in 2014, 56.5% in 2013, 45.7% in 2012, 66.8% in 2011
- Solidere has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.6%. At the same time it's in pair with industry average of 1.7%.
- CAPEX is quite volatile: 0.39 in 2015, 1.5 in 2014, 8.4 in 2013, 10.2 in 2012, 2.1 in 2011
- The company has unprofitable business model: ROIC is at -3.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Solidere ($SLED) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 332.2 | 149.8 | 178.2 | 239.0 | 96.0 | -59.8% |
| SG&A | | | | | 34.8 | |
| EBITDA | 221.9 | 68.5 | 100.7 | 115.0 | -73.1 | -163.6% |
| Net Income | 159.0 | 17.6 | 42.9 | 113.7 | -87.2 | -176.7% |
Balance Sheet
|
|---|
| Cash | 174.1 | 161.6 | 176.7 | 158.7 | 136.2 | -14.2% |
| Short Term Debt | 520.0 | 633.0 | 552.8 | 548.6 | 556.0 | 1.4% |
| Long Term Debt | 70.1 | 49.9 | 133.2 | 110.1 | 132.4 | 20.3% |
Cash flow
|
|---|
| Capex | 2.1 | 10.2 | 8.4 | 1.5 | 0.4 | -74.0% |
Ratios
|
|---|
| Revenue growth | -17.8% | -54.9% | 18.9% | 34.2% | -59.8% | |
| EBITDA growth | -12.0% | -69.2% | 47.1% | 14.2% | -163.6% | |
| EBITDA Margin | 66.8% | 45.7% | 56.5% | 48.1% | -76.2% | -124.3% |
| Net Income Margin | 47.9% | 11.8% | 24.1% | 47.6% | -90.9% | -138.5% |
| SG&A, % of revenue | | | | | 36.2% | 36.2% |
| CAPEX, % of revenue | 0.6% | 6.8% | 4.7% | 0.6% | 0.4% | -0.2% |
| ROIC | 8.6% | 2.0% | 3.3% | 3.6% | -3.4% | -7.0% |
| ROE | 8.4% | 0.9% | 2.2% | 5.7% | -4.3% | -10.0% |
| Net Debt/EBITDA | 1.9x | 7.6x | 5.1x | 4.3x | | -4.3x |
Revenue and profitability
Solidere's Revenue dropped on 59.8% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.7 pp from 0.79% to 2.5% in 2015.
Net Income marign dropped on 138 pp from 47.6% to -90.9% in 2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 0.41% in 2015. The company's CAPEX/Revenue decreased on 6.4 pp from 6.8% in 2012 to 0.41% in 2015. Average CAPEX/Revenue for the last three years was 1.9%.
Return on investment
The company operates at negative ROIC (-3.36%) and ROE (-4.34%). ROIC decreased on 7.0 pp from 3.6% to -3.4% in 2015. ROE decreased on 10.0 pp from 5.7% to -4.3% in 2015.
Leverage (Debt)
Debt level is -4.4x Net Debt / EBITDA and Debt / EBITDA. Net Debt / EBITDA dropped on 4.3x from 4.3x to in 2015. Debt increased on 4.5% in 2015 while cash dropped on 14.2% in 2015.
Appendix 1: Peers in
Below we provide Solidere benchmarking against other companies in 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 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Development Securities(Investments) ($36JS) | | | | -20.4% | 156.8% |
| Wereldhave Property Corp ($93IA) | | | -9.0% | 13.5% | 65.7% |
| Bld Property Hldgs ($09GE) | | | -1.1% | 16.0% | 39.3% |
| Grosvenor Uk Finance ($62QE) | | | 0.8% | 15.1% | 14.3% |
| Bbva International ($80LJ) | | | -1.5% | -3.5% | 14.0% |
| |
|---|
| Median (42 companies) | 5.1% | -6.3% | 1.5% | 2.9% | 1.0% |
|---|
| Solidere ($SLED) | | -54.9% | 18.9% | 34.2% | -59.8% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sanctuary Housing ($BB21) | | | 98.2% | 97.0% | 97.6% |
| Glh Hotels Ltd ($97KI) | | | | 57.8% | 57.6% |
| Aseana Properties Ltd ($ASPL) | 15.8% | 9.6% | 22.2% | 44.7% | |
| Palm Hills Developments Sae ($PHDC) | -6.8% | -5.2% | 22.3% | 33.5% | |
| Lewis(John) ($BC32) | | 33.4% | 33.4% | 33.4% | 33.8% |
| |
|---|
| Median (9 companies) | 4.9% | 29.8% | 30.3% | 33.4% | 34.6% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Bld Property Hldgs ($09GE) | | 108.3% | 91.0% | 218.5% | 215.1% |
| Intu Debenture ($69ZM) | | 70.3% | 79.8% | 163.8% | 107.2% |
| T.H.F.C.(Social Housing Finance) ($96JP) | | 0.7% | 1.0% | 2.4% | 97.9% |
| T.H.F.C.(Indexed) ($96JS) | | 0.7% | 1.0% | 2.4% | 97.9% |
| Housing Finance Corp ($68HB) | | 0.7% | 1.0% | 2.4% | 97.9% |
| |
|---|
| Median (25 companies) | 12.4% | 22.1% | 30.1% | 35.9% | 48.9% |
|---|
| Solidere ($SLED) | 66.8% | 45.7% | 56.5% | 48.1% | -76.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Wereldhave Property Corp ($93IA) | | 145.6% | 147.1% | 848.7% | 379.0% |
| Sanctuary Housing ($BB21) | | | 0.0% | 0.0% | 60.0% |
| Bld Property Hldgs ($09GE) | | 146.6% | 195.3% | 186.5% | 59.2% |
| Mid Kent Water ($48HO) | | 46.7% | 43.9% | 47.1% | 37.7% |
| Development Securities(Investments) ($36JS) | | | 2.9% | 13.5% | 24.6% |
| |
|---|
| Median (34 companies) | 3.8% | 3.7% | 2.9% | 3.3% | 4.5% |
|---|
| Solidere ($SLED) | 0.6% | 6.8% | 4.7% | 0.6% | 0.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Lewis(John) ($BC32) | | 12.5% | 15.6% | 16.4% | 18.6% |
| Lewis(John)Partnership ($BD32) | | 12.5% | 15.6% | 16.4% | 18.6% |
| Calgary & Edmonton Railway Co ($05GM) | | 8.2% | 10.5% | 16.0% | 17.0% |
| Canadian Pacific Railways ($BC87) | | 8.2% | 10.5% | 16.0% | 17.0% |
| Aeci ($87FZ) | | 12.9% | 14.5% | 16.8% | 15.0% |
| |
|---|
| Median (42 companies) | 6.6% | 1.7% | 3.3% | 3.3% | 3.4% |
|---|
| Solidere ($SLED) | 8.6% | 2.0% | 3.3% | 3.6% | -3.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Skipton Building Society ($SBSA) | | 29.7x | 30.3x | 30.2x | 34.7x |
| Housing Finance Corp ($68HB) | | 2,312.9x | 1,673.5x | 718.9x | 20.3x |
| T.H.F.C.(Indexed) ($96JS) | | 2,312.9x | 1,673.5x | 718.9x | 20.3x |
| T.H.F.C.(Indexed 2) ($90IL) | | 2,312.9x | 1,673.5x | 718.9x | 20.3x |
| T.H.F.C.(Social Housing Finance) ($96JP) | | 2,312.9x | 1,673.5x | 718.9x | 20.3x |
| |
|---|
| Median (25 companies) | 1.9x | 2.9x | 3.5x | 3.4x | 3.2x |
|---|
