China HGSReal Estate Inc. (HGSH) has reported an 84.03 percent plunge in profit for the year ended Sep. 30, 2016. The company has earned $5.02 million, or $0.11 a share in the year, compared with $31.43 million, or $0.70 a share for the last year.
Revenue during the year plunged 49.98 percent to $40.58 million from $81.12 million in the previous year.
Cost of revenue plunged 30.77 percent or $13.68 million during the year to $30.77 million. Gross margin for the year contracted 2104 basis points over the previous year to 24.16 percent.
Total expenses were $34.36 million for the year, down 27.93 percent or $13.32 million from year-ago. Operating margin for the year contracted 2590 basis points over the previous year to 15.32 percent.
Operating income for the year was $6.22 million, compared with $33.44 million in the previous year.
Revenue from real estate activities during the year plunged 49.98 percent or $40.54 million to $40.58 million. Revenue from sale of real estate was $40.58 million for the year, down 49.98 percent or $40.54 million from year-ago period.
Operating cash flow turns negative
China HGSReal Estate Inc. has spent $76.95 million cash to meet operating activities during the year as against cash inflow of $10.25 million in the last year.
Cash flow from investing activities was almost stable for the year at $0.13 million, when compared with the previous year.
Cash flow from financing activities was $82.31 million for the year as against cash outgo of $10 million in the last year period.
Cash and cash equivalents stood at $6.40 million as on Sep. 30, 2016, up 379.88 percent or $5.07 million from $1.33 million on Sep. 30, 2015.
Net receivables were at $2.92 million as on Sep. 30, 2016, down 4.70 percent or $0.14 million from year-ago. Accounts payable declined 26.33 percent or $10.93 million to $30.57 million on Sep. 30, 2016.
Total assets grew 19.42 percent or $57.95 million to $356.39 million on Sep. 30, 2016. On the other hand, total liabilities were at $201.44 million as on Sep. 30, 2016, up 42.90 percent or $60.47 million from year-ago.
Return on assets moved down 908 basis points to 1.47 percent in the year. At the same time, return on equity moved down 1672 basis points to 3.24 percent in the year.
Debt increases substantially
Total debt was at $105.97 million as on Sep. 30, 2016, up 282.59 percent or $78.27 million from year-ago. Shareholders equity stood at $154.95 million as on Sep. 30, 2016, down 1.60 percent or $2.53 million from year-ago. As a result, debt to equity ratio went up 51 basis points to 0.68 percent in the year.
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