Tropical Battery Company Limited (TROPICAL) for the first quarter ended December 31, 2023, reported a 25% increase in revenue totalling $809.13 million compared to $649.44 million in the corresponding three months last year. Management noted that the increase was primarily due to its successful expansion into new markets.

Cost of sales amounted to $562.03 million (2022: $434.16 million), this represents an increase of 29% year over year. Consequently, gross profit increased by 15% to $247.10 million compared to $215.28 million for the first quarter ended December 31, 2022.

Administrative, marketing and selling expenses increased by 2% to close at $147.41 million (2022: $144.70 million).

Operating profit increased by 41% from $70.58 million in 2022 to $99.69 million for the three months. Other operating income for the first quarter amounted to $6.57 million, a 220% increase relative to $2.05 million reported in 2022.

Profit before depreciation, net finance costs and taxation for the three months amounted to $106.27 million, a 46% increase relative to $72.63 million reported in 2022. Depreciation totalled $17.00 million, a 6% increase from the corresponding period last year (2022: $15.99 million).

Net finance costs for the first quarter ended December 31, 2023, amounted to $17.02 million, a 37% increase relative to $12.46 million reported in 2022 driven by higher finance costs for the period.

There were no taxation charges for the three months (2022: nil). Hence, net profit amounted to $72.24 million (2022: $44.18 million). Net profit attributable to shareholders for the three months amounted to $64.22 million, a 45% increase from the $44.18 million reported in 2022.

Earnings per share (EPS) for the three months amounted to $0.05 (2022: $0.03). The twelve-month trailing EPS was $0.12, and the number of shares used in these calculations was 1,303,750,000.

Notably, TROPICAL’s stock price closed the trading period on February 12, 2024, at a price of $2.70 with a corresponding P/E ratio of 21.64x.

Balance Sheet Highlights:

The company’s assets totalled $2.55 billion (2022: $2.25 billion); a 13% increase year on year largely attributed to a 57% improvement in cash and cash equivalents, which totalled $308.56 million (2022: $195.99 million).

Shareholder’s equity was $1.13 billion (2022: $1.05 billion), representing a book value per share of $0.86 (2022: $0.81).

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.