Assessing Hong Kong Life Sciences and Technologies Group Limited’s (SEHK:8085) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess 8085’s recent performance announced on 31 December 2017 and evaluate these figures to its long-term trend and industry movements. Check out our latest analysis for Hong Kong Life Sciences and Technologies Group

Commentary On 8085’s Past Performance

I use the ‘latest twelve-month’ data, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This method allows me to analyze many different companies on a similar basis, using the most relevant data points. For Hong Kong Life Sciences and Technologies Group, its most recent bottom-line (trailing twelve month) is -HK$65.86M, which, relative to the prior year’s level, has become more negative. Since these values may be relatively nearsighted, I’ve computed an annualized five-year value for Hong Kong Life Sciences and Technologies Group’s earnings, which stands at -HK$49.21M. This doesn’t seem to paint a better picture, as earnings seem to have gradually been getting more and more negative over time.

We can further evaluate Hong Kong Life Sciences and Technologies Group’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Hong Kong Life Sciences and Technologies Group’s top-line has increased by a mere 8.13%, on average. The company’s inability to breakeven has been aided by the relatively flat top-line in the past. Viewing growth from a sector-level, the HK trade distributors industry has been growing its average earnings by double-digit 23.75% in the prior twelve months, and 11.90% over the previous five years. This means that any uplift the industry is deriving benefit from, Hong Kong Life Sciences and Technologies Group has not been able to reap as much as its average peer.

What does this mean?

Hong Kong Life Sciences and Technologies 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 difficult to predict what will occur going forward, and when. The most useful step is to assess company-specific issues Hong Kong Life Sciences and Technologies Group may be facing and whether management guidance has dependably been met in the past. I recommend you continue to research Hong Kong Life Sciences and Technologies Group to get a better picture of the stock by looking at: