Wheelock Properties (Singapore) Ltd. :WKSGY-US: Earnings Analysis: Q1, 2017 By the Numbers : June 12, 2017

Wheelock Properties (Singapore) Ltd. reports financial results for the quarter ended March 31, 2017.

We analyze the earnings along side the following peers of Wheelock Properties (Singapore) Ltd. – Forestar Group Inc., Howard Hughes Corporation, Oppenheimer Holdings Inc. Class A, U.S. Global Investors, Inc. Class A and Piper Jaffray Companies (FOR-US, HHC-US, OPY-US, GROW-US and PJC-US) that have also reported for this period.

Highlights

  • Summary numbers: Revenues of USD 67.89 million, Net Earnings of USD 7.17 million.
  • Gross margins narrowed from 18.57% to 18.40% compared to the same period last year, operating (EBITDA) margins now 11.83% from 13.42%.
  • Year-on-year change in operating cash flow of 3.68% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • Narrowing of operating margins contributed to decline in earnings.

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):

2017-03-31 2016-12-31 2016-09-30 2016-06-30 2016-03-31
Relevant Numbers (Quarterly)
Revenues (mil) 67.89 158.69 113.79 223.1 67.3
Revenue Growth (%YOY) 0.88 103.2 86.15 270.63 -9.88
Earnings (mil) 7.17 -11.54 20.89 26.03 8.01
Earnings Growth (%YOY) -10.42 -1654.09 159.65 96.64 -11.04
Net Margin (%) 10.57 -7.27 18.36 11.67 11.9
EPS 0.12 -0.19 0.35 0.44 0.13
Return on Equity (%) 1.36 -2.16 3.78 4.68 1.46
Return on Assets (%) 1.27 -2 3.25 3.79 1.19

Access our Ratings and Scores for Wheelock Properties (Singapore) Ltd.

Market Share Versus Profits

Revenues History
Earnings History

WKSGY-US‘s change in revenue this period compared to the same period last year of 0.88% 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 WKSGY-US is holding onto its market share. Also, for comparison purposes, revenues changed by -57.22% and earnings by 162.18% compared to the immediate last period.

Revenues Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Leader, Earnings Focus, Laggard, Revenues Focus

Earnings Growth Analysis

The company’s year-on-year decline in earnings was influenced by a weakening in gross margins from 18.57% to 18.40%, as well as issues with cost controls. As a result, operating margins (EBITDA margins) went from 13.42% to 11.83% in this time frame. For comparison, gross margins were 9.13% and EBITDA margins were 10.51% in the previous period.

Gross Margin Versus EBITDA Margin

Quadrant label definitions. Hover to know more

Differentiated; Low Cost, Commodity; Low Cost, Commodity; High Cost, Differentiated; High Cost

Cash Versus Earnings – Sustainable Performance?

It is important to examine a company�s cash versus earnings numbers to gauge whether its performance is sustainable.

Operating Cash Flow Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Cash Flow based Earnings, Likely Non-cash Earnings, Low Cash Flow Base, Likely Undeclared Earnings

WKSGY-US‘s change in operating cash flow of 3.68% compared to the same period last year is about the same as its change in earnings this period. Additionally, this change in operating cash flow is about average among its peer group. This suggests that the company did not use accruals or reserves to manage earnings this period, and that, all else being equal, the earnings number is sustainable.

Margins

The company’s decline in earnings has been influenced by the following factors: (1) Decline in operating margins (EBIT margins) from 13.34% to 11.78% and (2) one-time items that contributed to a decrease in pretax margins from 11.92% to 11.41%

EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables
EBIT Margin History
PreTax Margin History

Access our Ratings and Scores for Wheelock Properties (Singapore) Ltd.

Company Profile

Wheelock Properties Ltd. is an investment company, which engages in the property investments, developments, and manages residential and commercial properties. It operates through the following business segments: Property Development, Property Investment, Investments, and Other Operations. The Property Development segment engages in the development, construction, and selling of development properties. The Property Investment segment engages in the holding and management of investment properties. The Investments segment engages in the holding of investment in equity and debt securities. The Other Operations segment includes investment holding company and provision of management services. The company was founded on December 19, 1972 and is headquartered in Singapore.

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