Three Companies That Reported Weaker Quarterly Performances Last Week

Straco Corporation Ltd (SGX: S85) is a developer and operator of tourism assets.

Currently, its operations include the Shanghai Ocean Aquarium, Underwater World Xiamen, and the Singapore Flyer. The first two are located in China, while the third is Singapore’s iconic observation wheel.

down by 3.4% year-on-year, while profit attributable to shareholders came in 3.6% lower. On the positive side, Straco ended the quarter with S$159.6 million in cash and equivalents and total borrowings of just S$64.9 million. This is an improvement over a year ago when there was S$140.9 million in cash and S$76.9 million in debt.

The falls in both revenue and profit were attributed to lower revenue from Underwater World Xiamen and Lixing Cable Car that was partially offset by higher revenues from Shanghai Ocean Aquarium and the Singapore Flyer.

The depreciation of the renminbi against the Singapore dollar over the past year also had an impact on Straco’s top-line.

Hour Glass Ltd (SGX: AGS) is in the business of selling luxury watches. It has a network of over 40 stores in Singapore, Malaysia, Thailand, Japan, Hong Kong, and Australia.

Hour Glass reported declines in both its top-line and bottom-line for the quarter. On the flipside, the firm reported positive free cash flow and has a balance sheet with a net cash.

Revenue for the quarter was down 7%, compared to the same quarter a year ago. Profit attributable to shareholders was also down 14% year-on-year to $8.3 million. Earnings per share (EPS) saw a 14% decline.

On a positive note, Hour Glass has $85.3 million in cash and borrowings of about $54.8 million, which is an improvement from a year ago, when the company had $76 million in cash and borrowings of$64.7 million.

Ezion (SGX: 5ME) is an oil and gas support services company. It owns a fleet of offshore assets that include multi-purpose self-propelled jack-up rigs and heavy-haul vessels. It also provides services such as well-servicing and maintenance, amongst others.

The challenging quarter can be summarised as follow: Ezion’s top-line decline was mainly due to a reduction in charter rates, modification to its service rigs, and a slower start to a customer’s project.

Cost of sales and servicing, though, rose despite the lower revenue. This was due to the deployment of additional service rigs.

As for the outlook, the Company expects the currect challenges for the Marine and Offshore Oil and Gas Industry (the “Offshore Industry”) to continue at least into 2017. 

Financially, Ezion’s revenue for the third quarter fell by 7.4% year-on-year to US$79.8 million, whilst profit was down by 69% year-on-year. Consequently, EPS for the quarter is down by 77%, compared to last year.

There are two further points to note:

  1. Trade receivables rose from US$202.3 million in the third-quarter of 2015 to around US$220 million in the reporting quarter. This increase in receivables came despite a fall in revenue. This could suggest that Ezion has not been able to collect customer payments in a timely manner.
  2. Ezion had reported US$12.2 million in profit from operating activities, but it is also stuck with financing costs of US$8.5 million for the reporting quarter. This is a big chink of its profit from operating activities.

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For more companies that have reported weaker performances in this season, please click here, here and here.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.