06-05-2014, 04:18 PM
Is there a way to better qualify the "capital intensiveness" of a company?
chemical industry is generally capital intensive and printing is also capital intensive too. But which of the two are more capital intensive?
What metrics can we used?
e.g. revenue earned per $ of PPP assets?
or net profit per $ of PPP assets?
EBITDA margin?
tks.
chemical industry is generally capital intensive and printing is also capital intensive too. But which of the two are more capital intensive?
What metrics can we used?
e.g. revenue earned per $ of PPP assets?
or net profit per $ of PPP assets?
EBITDA margin?
tks.
(06-05-2014, 03:52 PM)CityFarmer Wrote: [ -> ](06-05-2014, 11:59 AM)portuser Wrote: [ -> ]Sunsine did well in 1Q 2014 -- RMB 52m cash flow before working capital changes, and RMB 88m operating cash flow. It spent RMB 77m on PPE, presumably on the project to provide steam to all factories in the Shaxian Chemical Industrial Zone.
Cash holdings were RMB 145m as at 31 Mar 2014, up from RMB 101m three months ago.
The numbers are right, but let me elaborate.
OCF was 88m, while capex 77m, thus FCF was 11m. The company need to pay the bank int of 3.5m, so left 7.5m, with equity of 836m. A absolute ROE of <1%, and annualized <4%.
(06-05-2014, 11:59 AM)portuser Wrote: [ -> ]Rubber accelerators provide four-fifths of Sunsine’s revenue, and their ASP rebounded in 1Q 2014 to RMB 19,300, RMB 1,100 higher than the preceding quarter, after two years of being held down to gain market share.
Suspension of some accelerator factories has caused the price increase. Sunsine has stated in its 1Q 2014 results announcement that:
As the China government is placing more emphasis on environmental protection, some medium- and small-sized players in the rubber chemicals industry were forced to suspend their production. Further, due to the China government’s comprehensive measures on environmental protection, a few large-sized players also suspended their production. As such, the supply of accelerators in the market is decreasing. In order to maintain their productions to meet higher demand of tires, the tire makers placed more orders to purchase accelerators. The Group anticipates that the sales volume of accelerator products will continue to increase.
It is a good news. It shows the company process is well-managed (more environmental friendly) among its peers. Next question is how much it helps on sales? We saw only 5% increase in ASP in 1Q. May be we will see more in next few quarters.
(06-05-2014, 11:59 AM)portuser Wrote: [ -> ]The only outstanding capex is the steam generation project. Stronger cash flows in the subsequent quarters (as business in the first quarter is weaker because of lunar new year) may be sufficient for the remaining expenditure and working capitals.
The project is in a capital intensive business. High capex should be expected in due course, IMO.
Anyway, best wish to those vested, I might be wrong.
(not vested)