November 16, 2022

Seprod Limited (SEP)

Unaudited Financials for the Nine Months ended September 30, 2022:

Seprod Limited (SEP), for the nine months ended September 30, 2022, revenue totalled $51.44 billion compared to the $31.15 billion recorded for the same period of the prior financial year; this represents a 65.13% increase year over year. Revenue for the quarter totalled $23.64 billion a 108.75% increase relative to $11.32 billion the prior year. SEP highlighted that, “The results must be taken in the context of the acquisition of A.S Bryden & Sons Holdings Limited (the Bryden Group) in June 2022.”

Cost of Sales rose 65.06% from $23.03 billion in 2021 to $38.02 billion for the nine months ended September 30, 2022. Consequently, gross profit increased 65.33% to close at $13.42 billion (2021: $8.12 billion), while the second quarter gross profit amounted to $6.4 billion (2021: $2.68 billion).

However, other operating income for the period totalled $538.69 million relative to $155.78 million in 2021, a 245.8% increase year over year, while other operating expenses increased by 67.31% to close the nine months period at $9.15 billion (2021: $5.47 billion).

Consequently, operating profit rose by 71.51% to $4.81 billion (2021: $2.8 billion) for the nine months ended September 2022. While for the quarter, operating profit grew by 146% to $1.98 billion (2021: $804,453).

Finance costs totalled $1.3 billion (2021: $732.87 million), a 77.52% increase when compared to the same period last year. The company reported share of results of Joint Venture amounting to $35.64 million relative to $85.11 million reported in 2021.

Pre-tax profits climbed by 64.35% to $3.54 billion in comparison to $2.16 billion booked in the same period last year. For the quarter, pre-tax profit amounted to $1.48 billion relative to $625.48 million booked in 2021.

Taxation of $834.92 million was reported for the nine months period relative to $395.32 million booked in 2021. Consequently, SEP, for the period under review, booked net profit from continuing operations of $2.71billion (2021: $1.76 billion) and loss from discontinued operations closed at $78.42 million (2021: $59.76 million). As a result, overall net profit was $2.63 billion (2021: $1.7 billion) for the period under review, while for the quarter, net profit closed at $1.05 billion (2021: $494.52 million).

The comprehensive income for the nine months amounted to $2.51 billion (2021: $1.83 billion.) For the third quarter, comprehensive income amounted to $1.06 billion (2021: $540.05 million).

Net profit attributable to shareholders of the company amounted to $2.25 billion increasing 32% from $1.70 billion reported in 2021. Net profit attributable to shareholders of the company for the quarter was $771.61 million. (2021: $494.52 million).

Earnings per share attributable to stockholders for the nine months ended September 30, 2022 amounted to $3.07 relative to 2.32 for the corresponding period in 2021. The EPS for the quarter was reported at $1.05 relative to $0.67 reported in 2021. The twelve months trailing EPS is $3.98. The number of shares used in our calculations is 733,546,855. SEP closed the trading period on November 15, 2022 at $70.26 with a corresponding P/E of 17.63 times.

Balance Sheet at a Glance:

As at September 30, 2022, the company’s total assets increased 115.9% to $80.81 billion from $37.43 billion a year ago. The upward movement was due to an increase in ‘Property, Plant &  Equipment’ and ‘Inventories’ which closed the period at $20.36 billion (2021: $7.55 billion) and $20.27 billion (2021: $7.43 billion), respectively.

Shareholders’ equity for the period was $27.92 billion relative to $18.13 billion last year. As such, resulting in a book value per share of $38.06 relative to $24.72 last year.

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