Earning News Alert – Fang Holdings Limited (NYSE: SFUN)

Shares of Fang Holdings Limited (NYSE: SFUN) have been recently spotted trading -7.71% off of the 52-week high price. On the other end, company shares have been noted 109.35% away from the low price over the last 52-weeks. 52 week range of the stock remained $ 2.46 – 5.58. Switching over to some distances from popular moving averages, we see that the stock has been recorded 3.34% away from the 50 day moving average and 20.59% away from the 200 day moving average. Moving closer, we can see that shares have been trading 7.12% off of the 20-day moving average.

Fang Holdings Limited (NYSE: SFUN) today announced its unaudited financial results for fourth quarter and fiscal year ended December 31, 2017.

Fourth Quarter 2017 Results

Revenues

Fang reported total revenues of $112.2 million in the fourth quarter of 2017, a 35.8 % decrease from $174.7 million in the corresponding period of 2016, primarily due to the decline in e-commerce services by $81.4 million.

Revenue from listing services was $41.8 million in the fourth quarter of 2017, an increase of 8.2% from $38.6 million in the corresponding period of 2016, driven by the increased number of paying members.

Revenue from marketing services was $49.6 million in the fourth quarter of 2017, an increase of 3.4% from $48.0 million in the corresponding period of 2016, primarily driven by the refocus of Fang’s effort in the online business.

Revenue from e-commerce services was $8.5 million in the fourth quarter of 2017, a decrease of 90.6% from $89.9 million in the corresponding period of 2016, primarily due to Fang’s transformation back to a technology-driven open platform model.

Revenue from Internet financial services was $3.6million in the fourth quarter of 2017, a significant increase from $0.6 million in the corresponding period of 2016, primarily due to the recovery of loan operations and the introduction of collateral loan products.

Revenue from other value-added services was $8.6 million in the fourth quarter of 2017, an increase of 67.5% compared to $5.2 million in the corresponding period of 2016, primarily driven by the growth of data products in the research business.

Cost of Revenue

Cost of revenue was $29.7 million in the fourth quarter of 2017, a decrease of 66.8% from $89.4 million in the corresponding period of 2016, primarily driven by the closing of the self-owned brokerage stores, deduction of e-commerce staff and cost optimization under the technology-driven open platform model.

Operating Expense

Operating expenses were $51.9 million in the fourth quarter of 2017, a decrease of 44.9% from $94.2 million in the corresponding period of 2016.

Selling expenses were $27.8 million in the fourth quarter of 2017, a decrease of 53.0% from $59.2 million for the corresponding period of 2016, primarily driven by the decrease of advertising and promotion fee, sales commission fee.

General and administrative expenses were $24.3 million in the fourth quarter of 2017, a decrease of 31.1% from $35.3 million for the corresponding period of 2016, primarily due to the deduction of staff cost.

Operating Income

Operating income was $30.6 million in the fourth quarter of 2017, compared to operating loss of $8.9 million in the corresponding period of 2016, primarily attributable to the closing of the self-owned brokerage stores and effective cost control.

Income Tax Expenses

Income tax expenses were $13.1 million in the fourth quarter of 2017, compared to $3.1 million in the corresponding period of 2016.

Net Income and EPS

Net income attributable to Fang’s shareholders was $15.2 million in the fourth quarter of 2017, compared to net loss of $10.4 million in the corresponding period of 2016. Earnings per fully-diluted ordinary share and ADS were $0.16 and $0.03 in the fourth quarter of 2017, compared to loss per fully-diluted ordinary share and ADS of $0.11 and $0.02 in the fourth quarter of 2016, respectively.

Adjusted EBITDA

Adjusted EBITDA, defined as non-GAAP net income before income taxes, interest expenses, interest income, depreciation and amortization, was $35.6 million in the fourth quarter of 2017, compared to $2.4 million in the corresponding period of 2016.

Cash

As of December 31, 2017, Fang had cash, cash equivalents, and short-term investments of $507.1 million, compared to $590.5 million as of December 31, 2016. Net cash generated from operating activities was $57.1 million in the fourth quarter of 2017, compared to cash flow generated from operating activities of $85.1 million in the same period of 2016, primarily due to the decrease of cash inflow of loan receivable related to operating activities compared to the fourth quarter of 2016.

Fiscal Year 2017 Results

Revenues

Fang reported total revenues of $444.3 million for 2017, representing a decrease of 51.5% from $916.4 million for 2016, primarily due to the decline in e-commerce services revenue by 489.9 million.

Revenue from marketing services was $149.3 million for 2017, a decrease of 9.8% from $165.4 million for 2016, primarily due to less demand from property developers.

Revenue from e-commerce services was $87.8 million for 2017, a decrease of 84.8% from $577.7 million for 2016, primarily due to Fang’s transformation back to a technology-driven open platform model.

Revenue from listing services was $165.4 million for 2017, an increase of 40.0% from $118.1 million for 2016, driven by the increased number of paying members in lower-tier cities.

Revenue from financial services was $12.1 million for 2017, a decrease of 59.3% from $29.6 million for 2016,, primarily due to the reduced loan demand from decreased secondary transaction volumes of Fang’s own franchised brokerage services and a strategic shift to a more diversified loan business, which is still at its early stage.

Revenue from other value-added services was $29.8 million for 2017, an increase of 16.6% from $25.6 million for 2016, primarily driven by the growth of data products in the research business.

Cost of Revenue

Cost of revenue was $174.6 million for 2017, a decrease of 74.6% from $687.2 million for 2016, primarily driven by the closing of the self-owned brokerage stores, deduction of e-commerce staff and cost optimization under the technology-driven open platform model.

 

Operating Expenses

Operating expenses were $232.9 million for 2017, a decrease of 38.8% from $380.7 million for 2016.

Selling expenses were $91.3 million for 2017, a decrease of 60.3% from $229.8 million for 2016, primarily driven by the decrease of advertising and promotion fee, sales commission fee.

General and administrative expenses were $141.1 million for 2017, a decrease of 6.7% from $151.3 million for 2016, primarily due to the deduction of staff cost.

Operating Income

Operating income was $36.8 million for 2017, compared with operating loss of $151.4 million for 2016.

Income Tax Expenses

Income tax expenses were $21.4 million for 2017, compared to $25.0 million for the corresponding period in 2016. The expenses decrease was primarily due to the reversal of previously recorded ASC 740 (FIN 48) tax and interest liability.

Net Loss/Income and EPS

Net income attributable to Fang’s shareholders was $16.3 million for 2017, compared to net loss $169.6 million for 2016. Earnings per fully-diluted ordinary share and ADS were $0.18 and $0.04 in 2017, compared to loss per fully-diluted ordinary share and ADS of $1.81 and $0.36 in 2016, respectively.

Adjusted EBITDA

Adjusted EBITDA was $63.6 million for 2017, compared to negative $121.2 million for 2016.

Cash

Cash generated from operating activities was $126.9 million for 2017, compared to net cash generated from operating activities $131.2 million for 2016, primarily due to the decrease of cash inflow of loan receivable related to operating activities compared to 2016.

Business Outlook

Fang estimates its net income for 2018 will range from approximately $100 million to approximately $120 million, representing a year-on-year increase of approximately 388.3% to approximately 485.9%. This forecast reflects Fang’s current and preliminary view, which is subject to change.

The China based company Fang Holdings Limited traded with change of 2.59% to $5.15 with the total traded volume of 628818 shares versus to an average volume of 2.85M. The stock was down in the 5 days activity -1.18%. The one month performance of stock was low -0.99%. SFUN shares are 5.91% for the quarter and driving an 81.23% rally over the course of the past year and is now -10.04% since this point in 2018.  Right now SFUN beta is 1.3. The average volatility for the week and month was at 3.24% and 3.98% respectively.

Peter Hamm

Peter Hamm is an author, journalist and CEO of the website. He has more than 5 years of experience in institutional investment markets, including fixed income, equities, derivatives and real estate. He has a Bachelor in Business Administration with a major in Finance. He bought his first stocks in a private business at age 15 and made his first public stock trade at 23. He has always been interested in the stock market and how it behaves. As the dad of two children, he’s made saving money and investing for them a high priority. Over many years of investing, he has made some wise choices and he’s made many mistakes. But he’s learned from both. Mr. Peter observations and experience give him the insight to stock market patterns and the investor behaviors that create them. He reports about Earnings news category. Address: 3876 Levy Court, EASTON, Pennsylvania Email: Peter@newscontrol.info

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