Cathay International Hldgs Ltd Net Debt / EBITDA jumped on 6.4x from 6.3x to 12.7x in 2015 and Debt increased on 4.2%
30 Mar 2016 • About Cathay International Hldgs Ltd (
$CTI) • By InTwits
Cathay International Hldgs Ltd reported 2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Cathay International Hldgs Ltd doesn't have a profitable business model yet: 2015 ROIC is 1.1%
- Cathay International Hldgs Ltd has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.5%. At the same time it's a lot of higher than industry average of 6.6%.
- CAPEX is quite volatile: 6.6 in 2015, 6.0 in 2014, 13.8 in 2013, 18.3 in 2012, 17.4 in 2011
- The company has potentially unprofitable business model: ROIC is at 1.1%
- It operates with high leverage: Net Debt/EBITDA is 12.7x while industry average is 3.0x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Cathay International Hldgs Ltd ($CTI) key annual financial indicators
| mln. $ | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 91.4 | 109.3 | 114.8 | 150.0 | 120.9 | -19.4% |
| Gross Profit | 46.8 | 57.1 | 56.4 | 70.7 | 49.7 | -29.6% |
| SG&A | | | | 58.8 | 51.5 | -12.4% |
| EBITDA | 12.7 | 7.6 | 10.8 | 23.8 | 12.1 | -49.0% |
| Net Income | 1.4 | -6.8 | -6.2 | -1.3 | -13.6 | 948.4% |
Balance Sheet
|
|---|
| Cash | 20.2 | 14.6 | 16.8 | 19.4 | 22.3 | 15.1% |
| Short Term Debt | 114.5 | 76.7 | 94.8 | 104.3 | 106.0 | 1.6% |
| Long Term Debt | 9.2 | 52.3 | 52.9 | 64.4 | 69.8 | 8.3% |
Cash flow
|
|---|
| Capex | 17.4 | 18.3 | 13.8 | 6.0 | 6.6 | 10.0% |
Ratios
|
|---|
| Revenue growth | 12.0% | 19.6% | 5.1% | 30.6% | -19.4% | |
| EBITDA growth | 1.9% | -39.8% | 40.9% | 121.0% | -49.0% | |
| Gross Margin | 51.2% | 52.2% | 49.1% | 47.1% | 41.1% | -6.0% |
| EBITDA Margin | 13.9% | 7.0% | 9.4% | 15.8% | 10.0% | -5.8% |
| Net Income Margin | 1.6% | -6.2% | -5.4% | -0.9% | -11.2% | -10.4% |
| SG&A, % of revenue | | | | 39.2% | 42.6% | 3.4% |
| CAPEX, % of revenue | 19.0% | 16.7% | 12.1% | 4.0% | 5.5% | 1.5% |
| ROIC | 3.0% | 1.2% | 1.9% | 4.4% | 1.1% | -3.2% |
| ROE | 1.0% | -4.8% | -4.6% | -1.0% | -10.6% | -9.6% |
| Net Debt/EBITDA | 8.2x | 15.0x | 12.2x | 6.3x | 12.7x | 6.4x |
Revenue and profitability
Cathay International Hldgs Ltd's Revenue dropped on 19.4% in 2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin surged on 23.7 pp from -31.8% to -8.1% in 2015.
Gross Margin decreased on 6.0 pp from 47.1% to 41.1% in 2015. SG&A as a % of Revenue increased on 3.4 pp from 39.2% to 42.6% in 2015.
Net Income marign dropped on 10.4 pp from -0.86% to -11.2% in 2015.
Capital expenditures (CAPEX) and working capital investments
In 2015 Cathay International Hldgs Ltd had CAPEX/Revenue of 5.5%. CAPEX/Revenue dropped on 11.2 pp from 16.7% in 2012 to 5.5% in 2015. It's average CAPEX/Revenue for the last three years was 7.2%.The company invested a big chunk of EBITDA (54.8%) to CAPEX which didn't stop revenue from falling.
Return on investment
The company operates at low but positive ROIC (1.14%) and negative ROE (-10.58%). ROIC decreased on 3.2 pp from 4.4% to 1.1% in 2015. ROE decreased on 9.6 pp from -0.98% to -10.6% in 2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 12.7x and Debt / EBITDA is 14.5x. Net Debt / EBITDA jumped on 6.4x from 6.3x to 12.7x in 2015. Debt increased on 4.2% in 2015 while cash jumped on 15.1% in 2015.
Appendix 1: Peers in Pharmaceuticals & Biotechnology
Below you can find Cathay International Hldgs Ltd benchmarking vs. other companies in Pharmaceuticals & Biotechnology industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Source Bioscience ($SBS) | | 8.2% | 18.8% | 28.9% | 4.5% |
| Cyprotex ($CRX) | 33.5% | 5.3% | 17.3% | 18.5% | |
| Beximco Pharmaceuticals ($BXP) | 21.6% | 17.7% | 12.9% | 6.8% | |
| Animalcare Group ($ANCR) | | -8.2% | 11.6% | 6.3% | 5.1% |
| Taihua ($TAIH) | 116.8% | -35.4% | 33.4% | -2.6% | |
| |
|---|
| Median (9 companies) | 38.6% | 5.3% | 12.4% | -2.6% | -0.3% |
|---|
| Cathay International Hldgs Ltd ($CTI) | | 19.6% | 5.1% | 30.6% | -19.4% |
Top companies by Gross margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pfizer Inc ($PFZ) | 78.4% | 82.0% | 81.4% | 80.7% | 80.3% |
| Cyprotex ($CRX) | 83.2% | 81.9% | 80.0% | 75.0% | |
| Animalcare Group ($ANCR) | 54.0% | 54.0% | 56.0% | 55.4% | 55.9% |
| Source Bioscience ($SBS) | 44.4% | 45.1% | 46.0% | 48.6% | 50.5% |
| Beximco Pharmaceuticals ($BXP) | 48.0% | 47.3% | 46.1% | 45.5% | |
| |
|---|
| Median (9 companies) | 44.4% | 45.1% | 46.0% | 45.5% | 50.5% |
|---|
| Cathay International Hldgs Ltd ($CTI) | 51.2% | 52.2% | 49.1% | 47.1% | 41.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pfizer Inc ($PFZ) | 36.3% | 41.9% | 41.9% | 37.9% | 34.8% |
| Pharmstandard OJSC ($PHST) | 28.1% | 26.1% | 30.3% | 30.9% | |
| Beximco Pharmaceuticals ($BXP) | 30.5% | 29.1% | 26.9% | 27.2% | |
| Animalcare Group ($ANCR) | 29.9% | 24.2% | 25.2% | 24.5% | 25.4% |
| Source Bioscience ($SBS) | -6.8% | 16.1% | 16.7% | 20.1% | 20.5% |
| |
|---|
| Median (9 companies) | 23.2% | 21.1% | 16.7% | 20.1% | 23.3% |
|---|
| Cathay International Hldgs Ltd ($CTI) | 13.9% | 7.0% | 9.4% | 15.8% | 10.0% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Beximco Pharmaceuticals ($BXP) | 14.1% | 11.1% | 26.1% | 24.8% | |
| Cyprotex ($CRX) | 4.0% | 3.5% | 12.0% | 12.9% | |
| Eastpharma Ltd ($EAST) | 9.5% | 11.9% | 12.3% | 7.1% | 6.2% |
| Pharmstandard OJSC ($PHST) | 4.1% | 2.7% | 2.6% | 5.8% | |
| Source Bioscience ($SBS) | 46.3% | 13.7% | 7.9% | 5.3% | 5.3% |
| |
|---|
| Median (9 companies) | 4.0% | 2.7% | 3.1% | 5.3% | 2.9% |
|---|
| Cathay International Hldgs Ltd ($CTI) | 19.0% | 16.7% | 12.1% | 4.0% | 5.5% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Pharmstandard OJSC ($PHST) | 37.1% | 34.0% | 42.6% | 28.8% | |
| Animalcare Group ($ANCR) | 18.1% | 14.0% | 15.4% | 14.2% | 14.8% |
| Anpario ($ANP) | 11.9% | 15.9% | 14.7% | 13.6% | 13.8% |
| Pfizer Inc ($PFZ) | 10.8% | 11.6% | 10.9% | 9.9% | 9.1% |
| Beximco Pharmaceuticals ($BXP) | 9.4% | 9.7% | 8.9% | 8.7% | |
| |
|---|
| Median (9 companies) | 9.7% | 9.7% | 8.9% | 8.7% | 9.1% |
|---|
| Cathay International Hldgs Ltd ($CTI) | 3.0% | 1.2% | 1.9% | 4.4% | 1.1% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Cyprotex ($CRX) | -0.2x | 0.6x | -4.3x | 20.0x | |
| Eastpharma Ltd ($EAST) | 15.6x | 2.7x | 3.8x | 4.3x | 2.7x |
| Pfizer Inc ($PFZ) | 1.5x | 1.2x | 1.6x | 1.8x | 2.1x |
| Beximco Pharmaceuticals ($BXP) | 0.6x | 1.1x | 1.5x | 1.5x | |
| Source Bioscience ($SBS) | | 0.3x | 1.5x | 0.8x | 0.7x |
| |
|---|
| Median (9 companies) | -0.3x | 0.3x | -0.5x | 0.8x | 0.7x |
|---|
| Cathay International Hldgs Ltd ($CTI) | 8.2x | 15.0x | 12.2x | 6.3x | 12.7x |
