GPT Metro Office Fund :GMF-AU: Earnings Analysis: 2016 By the Numbers : August 4, 2016

GPT Metro Office Fund reports financial results for the year ended June 30, 2016.

Highlights

  • Gross margins narrowed from 79.51% to 76.30% compared to the same period last year, operating (EBITDA) margins now 44.93% from 53.10%.
  • Change in operating cash flow of -28.05% compared to same period last year is about the same as change in earnings, likely no significant movement in accruals or reserves.
  • Earnings growth due to contribution of one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income (See complete table at the end of this report):

N/A N/A N/A 2015 2016
Relevant Numbers (Annual)
Revenues N/A N/A N/A 32.82 34.41
Revenue Growth (YOY) N/A N/A N/A N/A N/A
Earnings N/A N/A N/A 41.53 51.35
Earnings Growth (YOY) N/A N/A N/A N/A 23.64
Net Margin N/A N/A N/A 126.54 149.22
EPS N/A N/A N/A 0.53 0.4
Return on Equity N/A N/A N/A 15.59 18.13
Return on Assets N/A N/A N/A 10.21 12.05

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Earnings Growth Analysis

The company’s earnings rose year-on-year. But this growth has not come as a result of improvement in gross margins or any cost control activities in its operations. Gross margins went from 76.30% to 79.51% for the same period last year, while operating margins (EBITDA margins) went from 44.93% to 53.10% over the same time frame.


Cash Versus Earnings – Sustainable Performance?

GMF-AU‘s year-on-year change in operating cash flow of -28.05% is around its change in earnings. This suggests that there are likely no significant movement in accruals or reserves for managing earnings this period.


Margins

The company’s operating (EBIT) margins contracted from 53.10% to 44.93%. In spite of this, the company’s earnings rose. This was influenced primarily by one-time items, which improved pretax margins from 126.54% to 149.22%.

Access our Ratings and Scores for GPT Metro Office Fund


Company Profile

GPT Metro Office Fund operates as a real estate investment trust which offers investors an exposure to a portfolio of six A-grade metropolitan and business park office properties located across Sydney, Melbourne and Brisbane. The company was founded on May 26, 2014 and is headquartered in Sydney, Australia.

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