Wheelock Properties (Singapore) Ltd. :WKSGY-US: Earnings Analysis: Q3, 2016 By the Numbers : November 17, 2016

Wheelock Properties (Singapore) Ltd. reports financial results for the quarter ended September 30, 2016.

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

Highlights

  • Summary numbers: Revenues of USD 113.79 million, Net Earnings of USD 20.89 million.
  • Gross margins narrowed from 24.46% to 21.22% compared to the same period last year, operating (EBITDA) margins now 17.02% from -1.08%.
  • Year-on-year change in operating cash flow of 19.71% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • One-time items weakened operating performance.

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):

2016-09-30 2016-06-30 2016-03-31 2015-12-31 2015-09-30
Relevant Numbers (Quarterly)
Revenues (mil) 113.79 223.1 67.3 78.09 61.13
Revenue Growth (%YOY) 86.15 270.63 -9.88 264.72 224.35
Earnings (mil) 20.89 26.03 8.01 -0.66 8.05
Earnings Growth (%YOY) 159.65 96.64 -11.04 99.17 -8.09
Net Margin (%) 18.36 11.67 11.9 -0.84 13.16
EPS 0.35 0.44 0.13 -0.01 0.13
Return on Equity (%) 3.78 4.68 1.46 -0.12 1.44
Return on Assets (%) 3.25 3.79 1.19 -0.1 1.16

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 86.15% 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 -49.00% and earnings by -19.75% 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 gross margins showed no year-on-year improvement. In spite of this, the company’s earnings rose, influenced primarily by the improvement in operating margins (EBITDA margins) from -1.08% to 17.02%. For comparison, gross margins were 16.23% and EBITDA margins were 12.85% in the last 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?

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 19.71% 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 expansion in operating (EBIT) margins from -1.16% to 16.99% has also impacted the company’s earnings growth. However, one-time items have been a drag on the operating performance. As a result, the company’s pretax margins contracted from 27.46% to 16.99%.

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. operates as a 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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