Company DescriptionProsperity REIT [SEHK: 808] is a Hong Kong collective investment scheme authorized under section 104 of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). Prosperity REIT owns a diverse portfolio of seven high-quality properties in the decentralized business districts of Hong Kong, comprising all, or a portion of, three Grade A office buildings, one commercial building, two industrial/office buildings and one industrial building, with a total gross rentable area of about 1.28 million sq. ft.

How the Company Makes Money

Prosperity Real Estate Investment Financial Statement Overview

Summary

Prosperity Real Estate Investment's financial health presents a mixed picture. While the company demonstrates strong EBITDA margins and a stable balance sheet with manageable leverage, the recent decline in revenue and negative net income raise concerns. The lack of recent cash flow data exacerbates the uncertainty about the company's current liquidity position. Thus, while there are strengths in operational efficiency and capital structure, profitability and cash generation require attention.

Income Statement

Neutral

Prosperity Real Estate Investment has experienced declining revenue over the past years, with a 2.73% decrease from 2023 to 2024. The Gross Profit Margin for 2024 stood at 64.7%, a slight decrease from previous years. The company has faced negative Net Income in recent years, indicating challenges in profitability. EBITDA margin remains strong at 87.06% in 2024, although net losses highlight underlying issues in operations.

Balance Sheet

Positive

The company's balance sheet shows a strong Equity Ratio of 69.33% in 2024, indicating a solid capital structure. The Debt-to-Equity ratio is manageable at 0.36, suggesting reasonable leverage. Return on Equity has been negative due to recent net losses, reflecting profitability challenges. Overall, the balance sheet remains stable with good equity levels.

Cash Flow

Negative

The cash flow situation is concerning with no operating or free cash flow reported for 2024, indicating potential liquidity issues. Previous years demonstrated positive free cash flow, but the lack of recent data questions the company's ability to generate cash from operations. Cash flow metrics need to be improved to support financial stability.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
425.37M	437.31M	428.81M	423.06M	457.47M
	Gross Profit
275.16M	299.31M	280.04M	276.57M	306.10M
	EBIT
268.03M	280.10M	369.10M	317.58M	208.27M
	EBITDA
370.38M	278.36M	369.10M	23.89M	208.27M
	Net Income Common Stockholders
-74.64M	-5.67M	74.89M	57.02M	-874.50M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
47.32M	61.01M	100.37M	205.96M	351.79M
	Total Assets
9.63B	9.81B	9.98B	10.19B	10.51B
	Total Debt
2.40B	2.35B	2.31B	2.32B	2.33B
	Net Debt
2.36B	2.28B	2.21B	2.12B	1.98B
	Total Liabilities
2.95B	2.92B	2.88B	2.92B	2.97B
	Stockholders Equity
6.68B	6.89B	7.10B	7.26B	7.54B
Cash Flow		Free Cash Flow
247.65M	283.91M	222.63M	260.51M	236.10M
	Operating Cash Flow
269.51M	306.86M	243.14M	267.03M	239.95M
	Investing Cash Flow
-21.57M	-21.75M	-20.50M	-6.52M	-3.86M
	Financing Cash Flow
-261.63M	-324.47M	-328.23M	-406.34M	-271.39M

Prosperity Real Estate Investment Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PREUF		$269.60M	―	-1.09%	8.95%	―	―
Sector *	61 Neutral	$2.83B	10.92	0.41%	8438.90%	5.75%	-21.03%
SGRRF			―	-0.78%	―	―	―
SHTRF		$469.62M	31.67	1.17%	6.09%	―	―
YUXXF		$491.57M	―	-2.11%	6.80%	―	―
5C3		€150.03M	―	-5.63%	10.29%	―	―
87001	55 Neutral	¥3.16B	―	-3.39%	0.84%	-3.16%	-28.30%

* Real Estate Sector Average

Performance Comparison

PREUF

Prosperity Real Estate Investment

0.17

-0.03

-15.00%

SGRRF

Spring Real Estate Investment

―

SHTRF

Sunlight Real Estate Investment

0.38

0.02

5.56%

YUXXF

Yuexiu Real Estate Investment

0.13

-0.06

-31.58%

DE:5C3

China Merchants Commercial Real Estate Investment Trust

0.13

0.01

8.33%

HK:87001

Hui Xian Real Estate Investment Trust

0.48

-0.20

-29.41%

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

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