Assessing Asia Energy Logistics Group Limited’s (SEHK:351) performance as a company requires looking at more than just a years’ earnings data. Below, I will run you through a simple sense check to build perspective on how Asia Energy Logistics Group is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its infrastructure industry peers. View our latest analysis for Asia Energy Logistics Group
How 351 fared against its long-term earnings performance and its industry
I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This allows me to analyze various companies on a more comparable basis, using new information. Asia Energy Logistics Group’s latest earnings -HK$130.9M, which, in comparison to the prior year’s level, has become less negative. Since these figures may be fairly short-term, I have estimated an annualized five-year value for Asia Energy Logistics Group’s net income, which stands at -HK$156.2M. This means that, even though net income is negative, it has become less negative over the years.
Additionally, we can examine Asia Energy Logistics Group’s loss by looking at what’s going on in the industry along with within the company. Firstly, I want to quickly look into the line items. Revenue growth over the last few years has been negative at -40.23%. The key to profitability here is to make sure the company’s cost growth is well-managed. Eyeballing growth from a sector-level, the HK infrastructure industry has been growing its average earnings by double-digit 19.90% in the previous year, and a more subdued 5.48% over the previous few years. This means despite the fact that Asia Energy Logistics Group is presently running a loss, it may have been aided by industry tailwinds, moving earnings towards to right direction.
What does this mean?
Asia Energy Logistics Group’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Companies that incur net loss is always hard to envisage what will happen in the future and when. The most insightful step is to assess company-specific issues Asia Energy Logistics Group may be facing and whether management guidance has dependably been met in the past. I suggest you continue to research Asia Energy Logistics Group to get a better picture of the stock by looking at:
1. Financial Health: Is 351’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.