LAB reports 34% increase in year end net profit

December 28, 2020

The Limners and Bards Limited (LAB), for the year ended October 31, 2020, reported 44% increase in revenues to $911.74 million versus $631.85 million booked in 2019. Revenues for the quarter rose by 55% to $225.59 million (2019: $145.57 million).

Cost of operating revenue rose by 51% for the period to $613.11 million (2019: $405.12 million). Consequently, gross profit for the period rose by 32% closing at $298.63 million compared to $226.73 million for the same period last year. For the quarter, gross profit increased 32% to $71.18 million (2019: $53.77 million).

The Company reported a 48% increase in total operating expenses to $173.42 million (2019: $117.23 million). For the quarter, the Company reported a 377% increase in total operating expenses which closed the quarter at $173.42 million (2019: $36.35 million). Of total expenses:

  • Administrative expenses increased 50% to close at $172.87 million relative to $115.15 million in 2019.
  • Selling and distribution costs closed at $548,564 (2019: $2.09 million).
  • Impairment losses on the financial asset amounted to $1.54 million (2019: $448,216)

Consequently, profit before net finance and taxation rose by 13% to $123.67 million (2019: $109.05 million).

Net finance income amounted to $3.65 million compared to net finance cost of $1.51 million for 2019. ‘Loss in value of investments classified as FVTPL’ amounted to $231,013 (2019: $85,958).

Profit before taxation amounted to $127.08 million (2019: $107.45 million). There was no taxation booked for the period under review (2019: $12.70 million), as such net profit for the year end grew by 34% to $127.08 million (2019: $94.75 million). Net profit for the quarter was reported at $19.27 million compared to $24.93 million booked in the corresponding quarter of 2019.

Earnings per share (EPS) for the year end amounted to $0.13 compared to $0.10 in 2019, while for the quarter EPS amounted to $0.020 versus $0.026 documented in the prior comparable quarter. The number of shares used in our calculations is 945,690,252 units. Notably, LAB’s stock price closed the trading period on December 24, 2020 at a price of $2.90 with a corresponding P/E ratio of 21.58 times.

 Balance Sheet Highlights:  

As at October 31, 2020, the Company reported total assets of $676.07 million, a 38% rise when compared to $488.52 million a year ago. This was as a result of ‘Cash and cash equivalents’ and Accounts receivable’ which closed at $380.42 million (2019: $291.58 million) and $158.43 million (2019: $83.84 million), respectively. Also, ‘Right of use assets’ contributed to the growth closing at $52.64 million (2019: nil). This was however tempered by a downward movement in ‘Property, plant and equipment’ which amounted to $57.31 million (2019: $99.98 million).

Shareholders’ Equity as at October 31, 2020 was $464.23 million compared to $356.06 million a year ago. This resulted in a book value per share of $0.49 compared to $0.38 in 2019.



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 effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.