Executive Summary
Fortune REIT reported QQ3 2024 revenue of HKD 437.24 million and gross profit of HKD 284.12 million, with operating income of HKD 279.43 million and a reported net loss of HKD 241.29 million. The quarterly bottom line was dominated by a sizable Net Other Income/Expenses charge of HKD -489.64 million and a depreciation/amortization figure shown as a negative HKD -279.43 million, resulting in a negative net income despite a robust operating margin (operating income margin ~63.9%). On a YoY basis, revenue and gross profit were broadly stable (YoY revenue -0.3%, gross profit -0.8%), but QoQ results deteriorated sharply (revenue -49.8%, gross profit -51.3%, operating income -51.1%), reflecting seasonality and the meaningfully negative non-operating items this quarter. Net income declined to a negative HKD 241.29 million, with EPS of -HKD 0.12. The company maintains a strong equity base (HKD 26.93b) and a large real estate portfolio (16 properties totaling ~3.0 million sq ft of retail space), but reports limited liquidity with current ratio and quick ratio both well below 1.0 (0.0461 and 0.0461 respectively) and a cash balance of HKD 96.65 million at quarter end. Dividend yield stands at about 4.12%, though the negative earnings backdrop implies dividend sustainability hinges on recurring cash flow and distributable income going forward.
Key Performance Indicators
QoQ: -49.84% | YoY:-0.31%
QoQ: -51.32% | YoY:-0.82%
QoQ: -51.08% | YoY:-0.92%
QoQ: -563.00% | YoY:-11.18%
QoQ: -566.67% | YoY:-9.09%
Key Insights
Revenue: HKD 437.242m; YoY -0.31%, QoQ -49.84%
Gross Profit: HKD 284.123m; YoY -0.82%, QoQ -51.32%; Gross Margin ~65.0%
Operating Income: HKD 279.425m; YoY -0.92%, QoQ -51.08%; Operating Margin ~63.9%
Net Income: HKD -241.291m; YoY -11.18%, QoQ -563.00%; EPS -0.12
EPS (Diluted): -0.12; Weighted avg shares ~2,033,718,235
Dividend Yield: 4.12%; Dividend Payout Ratio: -1.54x (reflecting negative net income)
Balance Sheet: Total assets HKD 38.46b; Total liabilities HKD 11.53b; Total equity HKD 26.93...
Financial Highlights
Revenue: HKD 437.242m; YoY -0.31%, QoQ -49.84%
Gross Profit: HKD 284.123m; YoY -0.82%, QoQ -51.32%; Gross Margin ~65.0%
Operating Income: HKD 279.425m; YoY -0.92%, QoQ -51.08%; Operating Margin ~63.9%
Net Income: HKD -241.291m; YoY -11.18%, QoQ -563.00%; EPS -0.12
EPS (Diluted): -0.12; Weighted avg shares ~2,033,718,235
Dividend Yield: 4.12%; Dividend Payout Ratio: -1.54x (reflecting negative net income)
Balance Sheet: Total assets HKD 38.46b; Total liabilities HKD 11.53b; Total equity HKD 26.93b
Liquidity: Current ratio 0.0461; Quick ratio 0.0461; Cash and cash equivalents HKD 96.65m; Short-term investments HKD 6.95m; Total debt HKD 9.82b; Net debt HKD 9.72b
Asset Quality and Leverage: Debt ratio 0.255; Debt-to-capitalization 0.267; PBV ~0.334; Price-to-Sales ~20.56; Price-to-Book ~0.334
Cash Flow: Operating cash flow not disclosed; No free cash flow data provided
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
437.24M |
-0.31% |
-49.84% |
| Gross Profit |
284.12M |
-0.82% |
-51.32% |
| Operating Income |
279.43M |
-0.92% |
-51.08% |
| Net Income |
-241.29M |
-11.18% |
-563.00% |
| EPS |
-0.12 |
-9.09% |
-566.67% |
Key Financial Ratios
operatingProfitMargin
63.9%
dividendPayoutRatio
-153.7%
Management Commentary
No earnings call transcript was provided in the data set; management remarks and quotes are not available to reference.
Forward Guidance
No explicit forward guidance was provided in the QQ3 2024 filing. Investors should monitor (1) occupancy and rent collection trends across Fortune REIT’s 16 retail properties, (2) debt maturity schedule and refinancing risk given the elevated leverage and tight liquidity, (3) stabilization of non-operating items that pressured profitability, and (4) capex plans and their impact on distributable income. Qualitatively, a more favorable consumer backdrop in Hong Kong and selective rent resets could improve recurring cash flow, while continued macro headwinds or higher financing costs could pressure distributions.