Datang Intl Power Generation Debt dropped on 20.0% in 2016 and Revenue decreased on 4.8%
15 Mar 2017 • About Datang Intl Power Generation (
$DAT) • By InTwits
Datang Intl Power Generation reported 2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Datang Intl Power Generation is a company in decline: 2016 revenue growth was -4.8%, 5 years revenue CAGR was -4.2%
- Datang Intl Power Generation has high CAPEX intensity: 5 year average CAPEX/Revenue was 32.8%. At the same time it's in pair with industry average of 29.8%.
- CAPEX is quite volatile: 3,048 in 2016, 5,372 in 2015, 8,815 in 2014, 9,559 in 2013, 2,970 in 2012
- The company has potentially unprofitable business model: ROIC is at 4.8%
- It operates with high leverage: Net Debt/EBITDA is 6.1x while industry average is 4.5x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Datang Intl Power Generation ($DAT) key annual financial indicators
| mln. CNY | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 77,598 | 75,227 | 70,194 | 61,196 | 58,261 | -4.8% |
| Gross Profit | | | | 18,789 | 14,645 | -22.1% |
| SG&A | | | | 3,827 | 3,833 | 0.2% |
| EBITDA | 22,296 | 25,262 | 24,396 | 23,234 | 22,664 | -2.5% |
| Net Income | 4,019 | 3,403 | 1,767 | 2,809 | -2,623 | -193.4% |
Balance Sheet
|
|---|
| Cash | 4,613 | 7,881 | 5,288 | 5,524 | 4,501 | -18.5% |
| Short Term Debt | 40,165 | 41,186 | 45,841 | 33,550 | 37,636 | 12.2% |
| Long Term Debt | 151,038 | 161,470 | 162,496 | 145,471 | 105,593 | -27.4% |
Cash flow
|
|---|
| Capex | 26,616 | 32,515 | 20,242 | 18,187 | 16,392 | -9.9% |
Ratios
|
|---|
| Revenue growth | 7.2% | -3.1% | -6.7% | -12.8% | -4.8% | |
| EBITDA growth | 23.1% | 13.3% | -3.4% | -4.8% | -2.5% | |
| Gross Margin | | | | 30.7% | 25.1% | -5.6% |
| EBITDA Margin | 28.7% | 33.6% | 34.8% | 38.0% | 38.9% | 0.9% |
| Net Income Margin | 5.2% | 4.5% | 2.5% | 4.6% | -4.5% | -9.1% |
| SG&A, % of revenue | | | | 6.3% | 6.6% | 0.3% |
| CAPEX, % of revenue | 34.3% | 43.2% | 28.8% | 29.7% | 28.1% | -1.6% |
| ROIC | 5.7% | 5.9% | 4.8% | 4.6% | 4.8% | 0.2% |
| ROE | 10.0% | 8.0% | 4.0% | 6.3% | -6.2% | -12.5% |
| Net Debt/EBITDA | 8.4x | 7.7x | 8.3x | 7.5x | 6.1x | -1.3x |
Revenue and profitability
The company's Revenue decreased on 4.8% in 2016. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased slightly on 0.93 pp from 38.0% to 38.9% in 2016.
Gross Margin decreased on 5.6 pp from 30.7% to 25.1% in 2016. SG&A as a % of Revenue showed almost no change in 2016.
Net Income marign decreased on 9.1 pp from 4.6% to -4.5% in 2016.
Capital expenditures (CAPEX) and working capital investments
In 2016 Datang Intl Power Generation had CAPEX/Revenue of 28.1%. CAPEX/Revenue dropped on 15.1 pp from 43.2% in 2013 to 28.1% in 2016. For the last three years the average CAPEX/Revenue was 28.9%.Battling declining revenue the company invested a large share of EBITDA (72.3%) to CAPEX but that didn't help at least in this year.
Return on investment
The company operates at low but positive ROIC (4.84%) and negative ROE (-6.19%). ROIC showed almost no change in 2016. ROE dropped on 12.5 pp from 6.3% to -6.2% in 2016.
Leverage (Debt)
Debt level is 6.1x Net Debt / EBITDA and 6.3x Debt / EBITDA. Net Debt / EBITDA dropped on 1.3x from 7.5x to 6.1x in 2016. Debt dropped on 20.0% in 2016 while cash dropped on 18.5% in 2016.
Appendix 1: Peers in Electricity
Below we provide Datang Intl Power Generation benchmarking against other companies in Electricity 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 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ksk Power Ventur ($KSK) | | 2.5% | -14.5% | 13.8% | 76.4% |
| Good Energy Group ($GOOD) | 30.7% | 43.3% | 42.6% | 11.6% | |
| Societatea Comerciala De Dis Si Fur ($ELSA) | -2.2% | 2.5% | -6.3% | 9.1% | |
| Mosenergo AO ($AOMD) | | -0.8% | 3.5% | 6.0% | 11.4% |
| RusHydro OJSC ($HYDR) | -17.6% | 5.0% | 5.1% | 5.4% | |
| |
|---|
| Median (8 companies) | 8.6% | 3.0% | 0.9% | 5.7% | 11.4% |
|---|
| Datang Intl Power Generation ($DAT) | | -3.1% | -6.7% | -12.8% | -4.8% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Infinis Energy ($INFI) | 44.7% | 45.0% | 45.8% | 45.1% | 45.9% |
| Renewable Energy Generation Ltd ($WIND) | 42.5% | 42.7% | 35.9% | 36.5% | |
| Good Energy Group ($GOOD) | 33.9% | 33.6% | 32.7% | 33.1% | |
| Ksk Power Ventur ($KSK) | 33.9% | 40.0% | 27.1% | 27.0% | 34.3% |
| |
|---|
| Median (4 companies) | 38.2% | 41.4% | 34.3% | 34.8% | 40.1% |
|---|
| Datang Intl Power Generation ($DAT) | | | | 30.7% | 25.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renewable Energy Generation Ltd ($WIND) | 24.4% | 23.0% | 10.5% | 125.2% | |
| Infinis Energy ($INFI) | 55.1% | 54.6% | 45.2% | 69.8% | 56.0% |
| Ksk Power Ventur ($KSK) | 43.1% | 40.6% | 30.3% | 26.0% | 37.3% |
| Societatea Comerciala De Dis Si Fur ($ELSA) | 12.2% | 11.9% | 16.7% | 17.8% | |
| Public Power Corp S.A. ($PPCD) | 15.3% | 19.1% | 20.0% | 17.7% | |
| |
|---|
| Median (8 companies) | 14.1% | 17.2% | 16.7% | 17.7% | 37.3% |
|---|
| Datang Intl Power Generation ($DAT) | 28.7% | 33.6% | 34.8% | 38.0% | 38.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Renewable Energy Generation Ltd ($WIND) | 142.1% | 77.4% | 167.6% | 100.1% | |
| Ksk Power Ventur ($KSK) | 194.9% | 100.4% | 59.5% | 58.3% | 8.7% |
| Good Energy Group ($GOOD) | 1.0% | 23.2% | 31.8% | 27.6% | |
| RusHydro OJSC ($HYDR) | 27.8% | 19.7% | 23.8% | 22.8% | |
| Infinis Energy ($INFI) | 23.6% | 32.3% | 16.2% | 22.8% | 56.6% |
| |
|---|
| Median (8 companies) | 18.5% | 21.4% | 20.0% | 22.8% | 8.7% |
|---|
| Datang Intl Power Generation ($DAT) | 34.3% | 43.2% | 28.8% | 29.7% | 28.1% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Societatea Comerciala De Dis Si Fur ($ELSA) | 3.2% | 4.0% | 6.5% | 7.9% | |
| Good Energy Group ($GOOD) | 10.8% | 12.2% | 7.0% | 5.8% | |
| Infinis Energy ($INFI) | 4.6% | 5.0% | 3.0% | 5.2% | 3.5% |
| RusHydro OJSC ($HYDR) | -0.7% | 3.0% | 4.3% | 4.2% | |
| Public Power Corp S.A. ($PPCD) | 1.5% | 3.6% | 3.7% | 1.4% | |
| |
|---|
| Median (8 companies) | 2.9% | 3.6% | 3.4% | 2.8% | 4.4% |
|---|
| Datang Intl Power Generation ($DAT) | 5.7% | 5.9% | 4.8% | 4.6% | 4.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Ksk Power Ventur ($KSK) | 12.8x | 16.0x | 26.5x | 30.7x | 12.7x |
| Good Energy Group ($GOOD) | -0.1x | 1.5x | 5.7x | 7.8x | |
| Public Power Corp S.A. ($PPCD) | 5.3x | 4.1x | 4.3x | 4.8x | |
| Infinis Energy ($INFI) | 3.3x | 4.2x | 5.1x | 4.3x | 5.4x |
| RusHydro OJSC ($HYDR) | 7.8x | 2.9x | 2.6x | 2.6x | |
| |
|---|
| Median (8 companies) | 4.3x | 2.2x | 4.7x | 3.4x | 5.4x |
|---|
| Datang Intl Power Generation ($DAT) | 8.4x | 7.7x | 8.3x | 7.5x | 6.1x |
