China Information Technology, Inc. :CNIT-US: Earnings Analysis: For the six months ended June 30, 2016 : September 6, 2016

China Information Technology, Inc. reports financial results for the half-year ended June 30, 2016.

We analyze the earnings along side the following peers of China Information Technology, Inc. – ImageWare Systems Incorporated, eFuture Holding, Inc. and Teradata Corporation (IWSY-US, EFUT-US and TDC-US) that have also reported for this period.

Highlights

  • Summary numbers: Revenues of USD 2.96 million, Net Earnings of USD -7.06 million.
  • Gross margins widened from 28.00% to 31.53% compared to the same period last year, operating (EBITDA) margins now -123.54% from -37.13%.
  • Earnings rose compared to same period last year, despite decline in operating and pretax margins.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2013-12-31 2014-06-30 2014-12-31 2015-06-30 2016-06-30
Relevant Numbers (Semi-Annual)
Revenues 38.86 29.98 38.18 16.05 2.96
Revenue Growth (YOY) N/A -19.6 -1.75 -46.45 -92.26
Earnings -68.72 0.03 -29.26 -6.76 -7.06
Earnings Growth (YOY) N/A 100.06 57.42 -22141.48 75.86
Net Margin -176.83 0.1 -76.64 -42.08 -238.97
EPS -2.48 0 -0.91 -0.21 -0.18
Return on Equity -157.98 0.1 -116.32 -35.09 -45.41
Return on Assets -62.5 0.03 -31.34 -7.81 -13.45

Access our Ratings and Scores for China Information Technology, Inc.

Market Share Versus Profits

Revenues History
Earnings History

CNIT-US‘s change in revenue this period compared to the same period last year of -92.26% is almost the same as its change in earnings, and is about average among the announced results thus far in its peer group, suggesting that CNIT-US is holding onto its market share. Also, for comparison purposes, revenues changed by -81.59% and earnings by -4.56% compared to the immediate last period.

Revenues Growth Versus Earnings Growth

Earnings Growth Analysis

The company’s earnings growth has been influenced by the year-on-year improvement in gross margins from 28.00% to 31.53%. However the company’s overhead costs have prevented it from fully capitalizing on these gross margin improvements. In fact, the company’s operating margins (EBITDA margins) showed no improvement over the same period last year.

Gross Margin Versus EBITDA Margin

Margins

Despite a decline in operating (EBIT) margins as well as a decline in pretax margins, the company’s earnings rose.

EBIT Margin Versus PreTax Margin
EBIT Margin History
PreTax Margin History

Access our Ratings and Scores for China Information Technology, Inc.

Company Profile

China Information Technology, Inc. is engaged in the provision of information and display technologies. It operates through the Information Technology and Digital Technology segments. The Information Technology segment includes software and system integration services. The Digital Technology segment sells hardware, hardware total solutions integrated with software, content and services. The company was founded on June 18, 2012 and is headquartered in Shenzhen, China.

CapitalCube does not own any shares in the stocks mentioned and focuses solely on providing unique fundamental research and analysis on approximately 50,000 stocks and ETFs globally. Try any of our analysis, screener or portfolio premium services free for 7 days. To get a quick preview of our services, check out our free quick summary analysis of CNIT-US.