Is New World Development (HKG:17) Using Too Much Debt?
Is New World Development (HKG:17) Using Too Much Debt?
David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the permanent loss of capital.' So it seems the smart money knows that debt - which is usually involved in bankruptcies - is a very important factor, when you assess how risky a company is. We note that New World Development Company Limited (HKG:17) does have debt on its balance sheet. But the more important question is: how much risk is that debt creating?
大衛·伊本說得好:『波動性不是我們關心的風險。我們關心的是避免資本的永久損失。』 所以似乎聰明的錢知道,債務——通常與破產有關——是評估一家公司風險的重要因素。我們注意到,新世界發展有限公司(HKG:17)確實在其資產負債表上有債務。但更重要的問題是:這些債務帶來了多少風險?
What Risk Does Debt Bring?
債務帶來了什麼風險?
Debt is a tool to help businesses grow, but if a business is incapable of paying off its lenders, then it exists at their mercy. Part and parcel of capitalism is the process of 'creative destruction' where failed businesses are mercilessly liquidated by their bankers. While that is not too common, we often do see indebted companies permanently diluting shareholders because lenders force them to raise capital at a distressed price. Of course, plenty of companies use debt to fund growth, without any negative consequences. When we examine debt levels, we first consider both cash and debt levels, together.
債務是幫助企業增長的工具,但如果一家公司無法償還其貸款人,那麼它就處於他們的掌控之下。資本主義的一個組成部分就是『創造性破壞』的過程,即失敗的企業被其銀行毫不留情地清算。雖然這種情況並不常見,但我們確實常常看到負債企業因爲貸款人強迫他們以低價籌集資金而永久稀釋股東權益。當然,很多公司使用債務來資助增長,而沒有負面後果。當我們檢查債務水平時,首先考慮的是現金和債務水平的結合。
What Is New World Development's Debt?
新世界發展的債務是多少?
The image below, which you can click on for greater detail, shows that New World Development had debt of HK$156.9b at the end of June 2024, a reduction from HK$190.7b over a year. However, it also had HK$36.7b in cash, and so its net debt is HK$120.2b.
下面的圖像,您可以單擊以獲取更詳細信息,顯示截至2024年6月底,新世界發展公司的債務爲1569億港元,較去年減少1907億港元。然而,它也有367億港元的現金,因此其淨債務爲1202億港元。
A Look At New World Development's Liabilities
觀察新世界發展的負債情況
According to the last reported balance sheet, New World Development had liabilities of HK$94.0b due within 12 months, and liabilities of HK$126.3b due beyond 12 months. On the other hand, it had cash of HK$36.7b and HK$4.93b worth of receivables due within a year. So it has liabilities totalling HK$178.7b more than its cash and near-term receivables, combined.
根據最新報告的資產負債表,新世界發展的負債爲940億港元,需在12個月內償還,超過12個月的負債爲1263億港元。另一方面,其現金爲367億港元,短期應收賬款價值49.3億港元。因此,總負債爲1787億港元,超過了其現金和短期應收賬款的總和。
The deficiency here weighs heavily on the HK$13.5b company itself, as if a child were struggling under the weight of an enormous back-pack full of books, his sports gear, and a trumpet. So we'd watch its balance sheet closely, without a doubt. At the end of the day, New World Development would probably need a major re-capitalization if its creditors were to demand repayment.
這裏的缺口對這家135億港元的公司影響巨大,就像一個孩子在承受滿是書籍的沉重揹包、運動器材和小號的重壓。因此,我們毫無疑問地會密切關注其資產負債表。最終,如果債權人要求償還,新世界發展可能需要進行一次大型再融資。
We use two main ratios to inform us about debt levels relative to earnings. The first is net debt divided by earnings before interest, tax, depreciation, and amortization (EBITDA), while the second is how many times its earnings before interest and tax (EBIT) covers its interest expense (or its interest cover, for short). Thus we consider debt relative to earnings both with and without depreciation and amortization expenses.
我們使用兩個主要的比率來告訴我們相對於收益的債務水平。第一個是淨債務除以利息、稅、折舊和攤銷前利潤(EBITDA),而第二個是其利潤前利息和稅(EBIT)覆蓋其利息費用的次數(或其利息覆蓋率,簡稱)。因此,我們考慮與折舊和攤銷費用相關的盈利以及沒有相關費用的盈利相對於債務水平。
Weak interest cover of 1.4 times and a disturbingly high net debt to EBITDA ratio of 16.7 hit our confidence in New World Development like a one-two punch to the gut. The debt burden here is substantial. Worse, New World Development's EBIT was down 24% over the last year. If earnings continue to follow that trajectory, paying off that debt load will be harder than convincing us to run a marathon in the rain. There's no doubt that we learn most about debt from the balance sheet. But it is future earnings, more than anything, that will determine New World Development's ability to maintain a healthy balance sheet going forward. So if you want to see what the professionals think, you might find this free report on analyst profit forecasts to be interesting.
1.4倍的利息覆蓋率和高達16.7的淨債務與EBITDA比率,像一記重拳擊打在我們對新世界發展的信心上。這一債務負擔相當龐大。更糟糕的是,新世界發展的EBIT在過去一年下降了24%。如果收益繼續沿着這個軌跡發展,償還這筆債務將比說服我們在雨中跑馬拉松更難。毫無疑問,我們大多數關於債務的知識都來自資產負債表。但未來的盈利,尤其是能夠判斷新世界發展維持健康資產負債表能力的關鍵。因此,如果想看看專業人士的看法,你可能會發現這份關於分析師利潤預測的免費報告很有趣。
Finally, a business needs free cash flow to pay off debt; accounting profits just don't cut it. So it's worth checking how much of that EBIT is backed by free cash flow. Over the last three years, New World Development reported free cash flow worth 5.0% of its EBIT, which is really quite low. For us, cash conversion that low sparks a little paranoia about is ability to extinguish debt.
最後,一家企業需要自由現金流來償還債務;會計利潤並不足夠。因此,值得檢查一下EBIT有多少是由自由現金流支持的。在過去三年中,新世界發展報告的自由現金流僅佔其EBIT的5.0%,這真的相當低。對我們來說,這樣低的現金轉換引發了我們對其清償債務能力的擔憂。
Our View
我們的觀點
On the face of it, New World Development's EBIT growth rate left us tentative about the stock, and its level of total liabilities was no more enticing than the one empty restaurant on the busiest night of the year. And furthermore, its interest cover also fails to instill confidence. Considering everything we've mentioned above, it's fair to say that New World Development is carrying heavy debt load. If you play with fire you risk getting burnt, so we'd probably give this stock a wide berth. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately, every company can contain risks that exist outside of the balance sheet. These risks can be hard to spot. Every company has them, and we've spotted 1 warning sign for New World Development you should know about.
從表面上看,新世界發展的EBIT增長率讓我們對這隻股票感到猶豫,其總負債水平也沒有比一年中最忙碌的夜晚裏空蕩蕩的餐廳更吸引人。此外,其利息覆蓋率也未能增強信心。考慮到我們上述提到的一切,可以公平地說,新世界發展揹負着沉重的債務負擔。如果玩火,你就有可能被燒到,所以我們可能會對這隻股票保持距離。在分析債務水平時,資產負債表顯然是一個開始的地方。但最終,每個公司都可能存在資產負債表外的風險。這些風險可能很難察覺。每家公司都有,而我們發現了新世界發展1個你應該知道的警告信號。
Of course, if you're the type of investor who prefers buying stocks without the burden of debt, then don't hesitate to discover our exclusive list of net cash growth stocks, today.
當然,如果你是那種喜歡購買沒有債務負擔的股票的投資者,那麼不要猶豫,今天就來發現我們獨家的淨現金成長股票列表。
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這篇來自Simply Wall ST的文章是一般性的。我們根據歷史數據和分析師預測提供評論,採用無偏見的方法,我們的文章並不旨在提供財務建議。它不構成對任何股票的買入或賣出建議,也未考慮到您的目標或財務狀況。我們旨在爲您提供以基本數據驅動的長期分析。請注意,我們的分析可能未考慮最新的價格敏感公司公告或定性材料。Simply Wall ST在提到的任何股票中均沒有持倉。