The Free Monthly Investment Newsletter
Last updated: December 2018

Young Investors

Case Study September 2013 : XiDeLang Holdings Limited

China Xidelang (Holdings) Ltd. established in 1993, which firmly runs with the business philosophy of “Set the firm business target so that create outstanding brand” and tightly follow the times trend of “base on production, key for development and lead by sales” so as to seek for the wholly development for enterprise. The main products are running shoes, basketball shoes, leisure shoes, skating shoes and tennis shoes.

Revenue and Profit

XDL’s has recorded a stable in its revenue and growth in its profits since FY2009.

Revenue and Profit
FYRevenue ('000)Revenue GrowthNet Profit ('000)Net Profit GrowthNet Profit Margin
2009 RM384,924 - RM68,395 - 17.77%
2010 RM465,081 20.82% RM79,318 15.97% 17.05%
2011 RM484,733 4.23% RM88,641 11.75% 18.29%
2012 RM464,983 -4.07% RM80,692 -8.97% 17.35%
Editor Speaks

In Revenue and Net Profit growth rates, XDL’s show a substantial increase in FY 2010. The revenue has maintained from RM460k to RM480k, while its revenue maintained from RM80k to RM88k for the latest 3 FY.

XDL’s Net Profit Margin has maintained around 17 - 18% level. It is a good profit margin compare to other industry.

Current Ratio

Current Ratio
Year 2009 2010 2011 2012
Current Assets (RM'000) 192,469 175,214 227,955 244,371
Current Liabilities (RM'000) 107,931 92,289 95,055 56,998
Current Ratio 1.8 1.9 2.4 4.3
Editor Speaks

XDL’s has putting much effort in controlling their liabilities with a healthy level. Current ratio increased substantially due to significant decreased in current liabilities and increased in current asset. The company is now standing at “Zero Debt” financial position.

Editor Looks Further

Dividends

For those concerned about dividend payouts, XDL’s only paid RM0.025 in FY2010.

PE Ratio

XDL’s PE Ratio has maintain at “attractive” level, from 2.60 in FY2009, 2.24 in FY2010, 2.01 in FY2011, to 2.20 in FY2012.

Some Good News
  1. XDL’s have 2000 distribute nets cover more than 30 provinces and products are widely sold to global markets.
  2. XDL’s passed ISO9001:2000 and gained the honorable titiles of “CHINA FAMOUS TRADEMARK”,”STATE INSPECTION FREE PRODUCTS”,”MOST FAVORITE BRAND IN 2005SPORTS FIELD”,”CHINA MEDIUM INDUSTRY ENTERPIRSE”,”FUJIAN FAMOUS PRODUCTS”,”FUJIAN WELL-KNOWN TRADEMARK” and so on.
  3. XDL’s has “Zero Debt”.
Some Bad News
  1. Paid the only dividend in FY2010.

Editor Delves Deeper

Cash Flow
Year 2011 2012
Net Cash Generated from Operating (RM'000) 75,471 77,066
Net Cash Generated from Investing (RM'000) -58,539 -50,915
Net Cash Generated from Financing (RM'000) 11,675 9,671
Cash and Cash Equivalents at End (RM'000) 116,316 149,741
Cash Flow

XDL’s has kept its record in generating positive cash flow from operating activities since FY2009. XDL’s then use this cash to purchase more fixed assets and reduced the interest component liabilities. The company is now having more flexibility in using its cash.

Editor Speaks

XDL's is one of the famous brands in China. As China emerge as one of the Strongest Competitors in global market, our team expect XDL's will further expands their business and generate good return for their investor. Although XDL's paid the only dividend in FY2010, but XDL's has uses the cash to purchase fixed assets for further business expands. Besides, the company also having “Zero Debt”, where its operation cost won’t affect by fluctuate in interest rate. In terms of PE ratio, our team would like to see this as “undervalued” stock. Our team is optimistic on its long term financial performance.

By the Young Investors Team