Netflix shares fell more than 8% in after-hours trading , as a disappointing second-quarter outlook and leadership changes outweighed otherwise solid first-quarter results. Weak Guidance Sparks Sell-Off Netflix forecast Q2 earnings of US$0.78 per share , below analyst expectations of US$0.84 , while revenue is projected at US$12.57 billion , missing the US$12.64 billion consensus . The weaker guidance raised concerns over near-term growth momentum , triggering a sharp negative market reaction. Strong Q1 Performance Fails to Impress For the first quarter: Revenue rose 16% YoY to US$12.25 billion (above estimates) Earnings surged 86% to US$1.23 per share However, earnings were boosted by a US$2.8 billion one-off termination fee , reducing the quality of underlying growth. Operating margin improved to 32.3% , but still came in below expectations (32.4%) , further dampening sentiment. Rising Costs and Strategic Sh...
Maintain neutral call with lower target price (TP) of RM6.08
IHH’s 3QFY16 revenue was RM2.44bn (+18.3% YoY), while its 9MFY16 stood at RM7.4bn (+20.0% YoY). Excluding exceptional items, IHH’s 3QFY16 core net profit increased 73.2% YoY, bringing its YTD core net profit to RM643.5m (+9.5% YoY), below our and consensus’ estimates, accounting for 60.7% and 65.1% of full year estimates respectively. The Group expects the pre-operating and start-up costs of new operations to partially erode its profitability during the initial stages. In addition, staff cost is expected to rise due to increased competition from trained healthcare personnel. As such, we adjust our cost accordingly and cut our earnings estimates by 13%-23% for FY16-18F and maintain our Neutral call on IHH with a lower TP of RM6.08 (previously RM7.02), premised on our FY17 blended EV/EBITDA.
- Parkway Pantai’s (PPL) revenue was higher by 19.6% YoY to RM1.54bn for 3QFY16, while EBITDA increased 14.2% YoY to RM354.4m, on the back of continuous ramp up of its Mount Elizabeth Novena Hospital in Singapore as well as contribution from its newly opened hospitals and acquisitions made in 2015. On operations, number of inpatient admissions in Singapore and Malaysia increased by 13.6% and 9.0% respectively. Its revenue per inpatient admissions in Singapore declined by 3.0%, while Malaysia increased by 10.2%. Its earnings was partially eroded by higher operating expenses and staff cost, start-up losses of RM2.3m from its new hospitals in Malaysia as well as pre-opening expenses of RM19.7m incurred for its coming Gleneagles Hong Kong.
- Acibadem’s revenue increased to RM808.7m (+17.8% YoY) in 3QFY16, while EBITDA declined by 10.3% YoY, on the back of higher staff costs as well as operating costs and rental expenses due to further depreciation of Turkish Lira (TL) against USD. EBITDA QoQ declined by 47.5% due to lower revenue and patient volumes during the summer months and long period of holidays to celebrate Eid festivities. Overall, Acibadem’s inpatient admissions jump by 47.9% YoY, mainly contributed by Acibadem City Group. Nevertheless, its revenue per inpatient declined by 9.7% YoY.
- Project progress. The latest project to be completed will be Gleneagles Hong Kong and Acibadem Altunizade in Istanbul, which is expected to complete in the 1st half of 2017. While Acibadem Atasehir in Istanbul, Pantai Hospital Kuala Lumpur and Gleneagles Medini, are all targeted to complete by end-2017 (Table 2)
Source: PublicInvest Research - 25 November 2016
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