November 13, 2023
One Great Studio Company Limited (1GS) for the nine months ended September 30, 2023, reported a 168% increase in Revenue totaling $361.85 million compared to $135.06 million in the corresponding period last year. Revenue for the third quarter had a 159% increase to close at $126.40 million compared to $48.80 million for the comparable quarter of 2022. 1GS noted that the performance was primarily driven by their SEO business line.
Cost of sales amounted to $177.87 million (2022: $65.60 million), this represents an increase of 171% year over year. Consequently, gross profit increased by 165% to $183.97 million compared to $69.46 million for the nine months ended September 30, 2022. The company booked gross profit of $61.34 million for the third quarter versus $18.79 million reported for the similar quarter of 2022.
Administrative expenses increased by 28% to close at $59.10 million (2022: $46.26 million), while Operating profit increase by 438% from $23.19 million in 2022 to $124.88 million in the period under review. Other income for the nine months amounted to $1.81 million, a 125% increase relative to $803,063 reported in 2022.
EBITDA for the nine months amounted to $126.68 million, a 649% increase relative to $16.91 million reported in 2022. EBITDA for the third quarter amounted to $42.54 million (2022: Loss of $3.75 million). Interest expenses totalled $26.93 million, a 3973% increase from the corresponding period last year. (2022: $661,087).
Profit before Taxation for the nine months amounted to $93.51 million, a 543% increase relative to $14.55 million reported in 2022. Profit before Taxation for the third quarter amounted to $32.44 million (2022: Loss of $4.40 million).
Taxation charge for the nine months amounted to $16.17 million (2022: $3.10 million). Net profit for the period amounted to $77.34 million, a 576% increase from the $11.45 million reported in 2022. For the third quarter, Net profit was $27.21 million relative to a Net loss of $3.46 million reported for 2022. Management noted, “We anticipate that as we continue to onboard & deploy resources focused on business development, we’ll be able to capitalize on the large pipeline of opportunities generated by our IPO marketing efforts. This will ultimately lead to further organic growth in the upcoming quarters.”
Consequently, Earnings Per Share for the nine months amounted to $0.05 (2022: EPS: $0.01), while Earnings Per Share for the quarter totaled $0.02 (2022: LPS: $0.002). The twelve-month trailing EPS was $0.06, and the number of shares used in these calculations was 1,693,131,075.
Notably, 1GS’s stock price closed the trading period on November 10, 2023, at a price of $1.00 with a corresponding P/E ratio of 18.05x.
The Company highlighted, “Q3 2023 represents 1GS’ best quarter to date with the company reporting new highs in revenues and net profits, while significantly reducing our debt load and generating strong cashflows from operations.”
Additionally, “With the successful IPO, we have honored our commitment to debt reduction and financing of the IPO issuance costs and have begun to execute our strategic growth initiatives as outlined in the prospectus.”
Balance Sheet Highlights
The company’s assets totalled $663.92 million (2022: $459.53 million). The increase in assets was mainly due to a 293% jump in cash and cash equivalents closing at $262.06 million. The increase in cash resources was driven by “strong operating cashflows for the quarter, emanating from higher relative profitability and IPO proceeds of J$338.6 million”, according to 1GS.
Shareholder’s equity was $589.39 million (2022: $148.42 million), representing a book value per share of $0.35 (2022: $0.09).
Disclaimer:
Analyst Certification – The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.
Company Disclosure – The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may affect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.