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Fang Holdings (SFUN) Q4 Earnings & Revenues Decline Y/Y

Zacks Equity Research

Fang Holdings Limited SFUN reported fourth-quarter 2018 loss of 2 cents per share (on an adjusted basis) against earnings of 5 cents in the prior-year quarter. Total revenues of $82.2 million decreased 26.8% year over year due to a decline in revenues from listing and e-commerce services.

The company is continuing with its restructuring activities by focusing on its data and analytics business and Internet and advertising and listing services. Spin-off of China Index Holdings is in progress. Meanwhile, the company is also considering separation of its core Internet advertising and listing services for an independent listing.

So far this year, shares of Fang Holdings have gained 4.2% compared with 38.8% rise of the industry it belongs to.

 

Let’s check out the numbers in detail.

Revenues in Detail

Marketing services revenues of $41.5 million decreased 16.3% year over year due to a slowdown in the real estate market and the continued impact of tightening policies.

Listing services revenues of $24.4 million decreased 41.6% due to lower number of paying members.

Revenues from value-added services came in at $11.1 million, up 28.5% from the prior-year quarter, driven by increased demand for our database and research services.

Financial services revenues of $2.4 million declined 35.3% from the year-ago quarter.

Revenues from e-commerce services decreased 67.1% year over year to $2.8 million owing to the company’s reversion to a technology-driven open platform model.  

Profitability Performance

Gross profit decreased 15.5% from the year-ago quarter to $69.7 million. Adjusted EBITDA came in at $19.3 million compared with $41 million in the prior-year quarter. Operating income came in at $11.9 million, down from $36 million in the year-ago quarter, owing to decline in revenues from listing and e-commerce services and increase in bad debts.

Operating expenses of $57.9 million increased 24.4% year over year. Selling expenses of $13.8 million decreased 50.2% year over year as a result of lower advertising and promotional expenses and deduction of staff cost. General and administrative expenses increased to $43.8 million from $18.9 million in the year-ago quarter due to rise in bad debts.

Fang Holdings Limited Price, Consensus and EPS Surprise

 

Fang Holdings Limited Price, Consensus and EPS Surprise | Fang Holdings Limited Quote

Balance Sheet

Fang Holdings exited fourth-quarter 2018 with cash and cash equivalents, restricted cash (current and non-current) and short-term investments of $463.6 million compared with $439.9 million at the end of the prior quarter. Long-term loan was $123.22 million compared with $124.38 million at the end of prior quarter.

Zacks Rank & Upcoming Releases

Currently, Fang Holdings carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Investors interested in the broader Zacks Business Services sector are awaiting first-quarter 2019 reports of key players like FLEETCOR Technologies FLT, Gartner IT and Equifax EFX. While FLEETCOR and Gartner are slated to report on May 7, Equifax is scheduled to release results on May 10.

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