KREMI reports 59% increase in first quarter net profit

Date: July 13, 2018 

Caribbean Cream Limited (KREMI) for quarter ended May 31, 2018 reported a 29% increase in revenue to total $411.75 million compared to $319.10 million in the corresponding period last year. According to the company, “These results are attributed to improved product supply as a result of greater production efficiencies, along with the introduction of a new range of novelties which are performing well in the market. In addition, we continued our sales and marketing thrust to expand our market penetration and ‘top of the mind’ awareness of our product range.”

Costs of Sales for the first quarter amounted to $265.15 million, an increase of 25%. Management indicated this increase is mainly attributed to,l “ higher costs incurred to meet the growth in volume sales.”  Nevertheless, Gross Profit rose 37% or $39.24 million to $146.60 million compared to $107.36 million for the corresponding period in 2017.

Administrative Expenses increased by 25% to close the period at $75.90 million (2017: $60.50 million), while Selling and Distribution Costs rose 23% from $10.76 million to $13.22 million. Management noted “The Company has strengthened its focus on New Product Research and Development in order to increase the range of products available to the consumer.”

The Company booked other income of $565,450, a 5% decline relative to $592,900 reported for the comparable period in 2017.

Finance Cost for the quarter rose 7% to amount to $3.38 million relative to $3.15 million recorded in the first quarter of 2017. Interest income for the period however reflected a decline of 46% to $711,475 million versus $1.31 million book in 2017.

No taxes were charged for the quarter, as such Net Profit Attributable to Shareholders increased by 59% from $34.86 million in 2017 to $55.37 million. Consequently, Earnings per Share for the quarter amounted to $0.15 relative to $0.09 for the prior year’s corresponding quarter. The trailing twelve months earnings per share amounted to $0.29. The total number of shares employed in our calculations amounted to 378,568,115 units. Notably, KREMI’s stock price closed the trading period on July 12, 2018, at a price of $4.90.

Balance Sheet Highlights:

The company’s assets totaled $964.59 million, $179.59 million more than its value as at May 2017. The increase in assets was largely due to an increase of $177.98 million in ‘Property, Plant and Equipment’ to a total of $605.37 million (2017: $427.39 million). ‘Cash and Cash Equivalents’ also increased by 18% to close the year at $183.10 million compared to the $155.61 reported in the previous year.

Shareholders’ equity was $692.86 million (2017: $605.30 million), representing a book value per share of $1.83 (2017: $1.60).


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