When Grand T G Gold Holdings Limited’s (SEHK:8299) announced its latest earnings (31 December 2017), I wanted to understand how these figures stacked up against its past performance. The two benchmarks I used were Grand T G Gold Holdings’s average earnings over the past couple of years, and its industry performance. These are useful yardsticks to help me gauge whether or not 8299 actually performed well. Below is a quick commentary on how I see 8299 has performed. See our latest analysis for Grand T G Gold Holdings

Despite a decline, did 8299 underperform the long-term trend and the industry?

I look at data from the most recent 12 months, 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 method allows me to examine many different companies in a uniform manner using the most relevant data points. For Grand T G Gold Holdings, its most recent earnings (trailing twelve month) is -HK$3.63M, which compared to the prior year’s figure, has turned from positive to negative. Given that these values are fairly short-term thinking, I have created an annualized five-year value for 8299’s earnings, which stands at -HK$177.45M. This suggests that, although net income is negative, it has become less negative over the years.

We can further assess Grand T G Gold Holdings’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Grand T G Gold Holdings’s top-line has risen by 28.66% on average, implying that the company is in a high-growth period with expenses racing ahead revenues, leading to annual losses. Scanning growth from a sector-level, the HK metals and mining industry has been multiplying average earnings growth of 80.79% in the past twelve months, . This is a a solid turnaround from a volatile drop of -13.93% in the past few years. This means whatever uplift the industry is profiting from, Grand T G Gold Holdings has not been able to leverage it as much as its industry peers.

What does this mean?

While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always hard to predict what will happen in the future and when. The most insightful step is to examine company-specific issues Grand T G Gold Holdings may be facing and whether management guidance has consistently been met in the past. I suggest you continue to research Grand T G Gold Holdings to get a better picture of the stock by looking at: