Wharf Real Estate Investment Co (HKSE:01997) Operating Income : HK$9,993 Mil (TTM As of Dec. 2023)

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What is Wharf Real Estate Investment Co Operating Income?

Wharf Real Estate Investment Co's Operating Income for the six months ended in Dec. 2023 was HK$5,053 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 was HK$9,993 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Wharf Real Estate Investment Co's Operating Income for the six months ended in Dec. 2023 was HK$5,053 Mil. Wharf Real Estate Investment Co's Revenue for the six months ended in Dec. 2023 was HK$6,833 Mil. Therefore, Wharf Real Estate Investment Co's Operating Margin % for the quarter that ended in Dec. 2023 was 73.95%.

Warning Sign:

Wharf Real Estate Investment Co Ltd operating margin has been in a 5-year decline. The average rate of decline per year is -1.7%.

Wharf Real Estate Investment Co's 5-Year average Growth Rate for Operating Margin % was -1.70% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Wharf Real Estate Investment Co's annualized ROC % for the quarter that ended in Dec. 2023 was 3.38%. Wharf Real Estate Investment Co's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 was 126.20%.

Wharf Real Estate Investment Co Operating Income Historical Data

The historical data trend for Wharf Real Estate Investment Co's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Wharf Real Estate Investment Co Operating Income Chart

Wharf Real Estate Investment Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Operating Income

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12,711.00

9,973.00

9,064.00

8,841.00

9,993.00

Wharf Real Estate Investment Co Semi-Annual Data
	Dec14	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Operating Income	Get a 7-Day Free Trial													4,636.00	4,446.00	4,395.00	4,940.00	5,053.00

Wharf Real Estate Investment Co Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Dec. 2023 adds up the semi-annually data reported by the company within the most recent 12 months, which was HK$9,993 Mil.

Wharf Real Estate Investment Co (HKSE:01997) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Wharf Real Estate Investment Co's annualized ROC % for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Jun. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	10106 * ( 1 - 15.14% )	/	( (253914	+	252942)	/ 2 )
=	8575.9516	/	253428
=	3.38 %

where

	Invested Capital		(Q: Jun. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	248617	-	4149	-	( 977	-	max(0, 13635	-	4189	+	977	))
=	253914

	Invested Capital		(Q: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	245322	-	3575	-	( 1124	-	max(0, 14677	-	3482	+	1124	))
=	252942

Note: The Operating Income data used here is two times the semi-annual (Dec. 2023) data.

2. Joel Greenblatt's definition of Return on Capital:

Wharf Real Estate Investment Co's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2023 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Dec. 2023 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Jun. 2023		Q: Dec. 2023
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	9210	/	( ( (7190 + max(-5733, 0))	+	(7406 + max(-5689, 0)) )	/	2 )
=	9210	/	( ( 7190	+	7406 )	/	2 )
=	9210	/	7298
=	126.20 %

where Working Capital is:

	Working Capital		(Q: Jun. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(229	+	1653	+	318)	-	(4149	+	0	+	3784)
=	-5733

	Working Capital		(Q: Dec. 2023 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(258	+	1135	+	2)	-	(3575	+	0	+	3509)
=	-5689

When net working capital is negative, 0 is used.

Note: The EBIT data used here is two times the semi-annual (Dec. 2023) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Wharf Real Estate Investment Co's Operating Margin % for the quarter that ended in Dec. 2023 is calculated as:

Operating Margin %	=	Operating Income (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	5053	/	6833
	=	73.95 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Wharf Real Estate Investment Co Operating Income Related Terms

Thank you for viewing the detailed overview of Wharf Real Estate Investment Co's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Wharf Real Estate Investment Co (HKSE:01997) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » Real Estate » Wharf Real Estate Investment Co Ltd (HKSE:01997) » Definitions » Operating Income

Comparable Companies

Traded in Other Exchanges

WRFRF:USA 4WF:Germany

Address

https://www.wharfreic.com/en/investor/reports, 16th Floor, Ocean Centre, Harbour City, Kowloon, Hong Kong, HKG

Website

https://www.wharfreic.com

Wharf spun off Wharf Real Estate Investment Co in November 2017. It is a leading property investor with a focus in prime retail assets in Hong Kong. Rental income from two flagship assets Harbour City and Times Square account for around 80% of revenue. The balance is made up of The Murray hotel, a suburban mall in Plaza Hollywood, two offices in Central CBD. The group also holds two malls in Singapore and a mixed-development in Suzhou. Wharf was originally a shipping company but transformed into a property developer and investor in the 1960s by redeveloping its unused industrial assets, many located in city-center and waterfront locations. The Harbour City site was previously wharfs, and the Times Square site was a tram depot in the 1970s. Wheelock holds a 45% stake in WREIC.

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