May 22, 2024
Seprod Limited(SEP)
Unaudited financials for the first quarter ended March 31, 2024:
Seprod Limited (SEP) for the first quarter ended March 31, 2024, showcased a robust performance with a 6% year-over-year increase in turnover, reaching a total of $28.59 billion compared to $27.06 billion in the corresponding quarter last year. This growth is a testament to management resilience and strategic planning.
The cost of sales amounted to $21.10 billion (2023: $20.15 billion), an increase of 5% year over year. Consequently, gross profit increased by 8% to $7.49 billion, compared to $6.91 billion for the first quarter ended March 31, 2023.
Finance & Other Operating Income decreased by 1% to close at $219.19 million (2023: $222.19 million), while Administrative Expenses & other operating expenses increased by 9% from $4.86 billion in 2023 to $5.31 billion for the current quarter. As a result, Operating Profit for the first quarter amounted to $2.40 billion, a 5% increase relative to the $2.27 billion reported in 2023.
One area that has seen a significant increase is Finance Costs, which amounted to $795.06 million for the first quarter of 2024. This represents a 28% increase from the $619.44 million reported in 2023, ascribed to the rise in interest rates affecting the companies’ debt financing mechanisms.
Share of Results of associate & joint venture for the quarter amounted to $141.25 million, a 33% increase relative to $106.08 million reported in 2023. Profit Before Taxation totaled $1.74 billion, a 1% decrease from last year’s corresponding period. (2023: $1.76 billion).
Taxation for the first quarter ended March 31, 2024, amounted to $514.10 million, a 30% increase relative to $396.05 million reported in 2023.
Net Profit from Continuing Operations decreased by 10% to $1.23 billion (2023: $1.36 billion). This decrease can be attributed to issues alluded to by management; ” Higher effective tax rate in the Bryden Group due to the business mix and expiration of benefits enjoyed in 2023. Drought in Jamaica has affected the dairy farm operation, significantly increasing costs. Supply chain challenges from some of our principals affected the pharmaceutical business. Cost increases from insurance, interest rates, security, transportation, etc. continue to erode the profit margin.”
Net loss from discontinued operations amounted to $24.39 million from the $8.76 million reported in 2023.
The net profit attributable to shareholders for the first quarter ended March 31, 2024, and amounted to $964.73 million, a 2% decrease relative to the $981.32 million reported in 2023.
Consequently, Earnings Per Share for the quarter amounted to $1.32 (2023: EPS: $1.34). The twelve-month trailing EPS was $3.91, and the number of shares used in these calculations was 733,546,855. Notably, SEP’s stock price closed the trading period on May 21, 2024, at a price of $77.68, with a corresponding P/E ratio of 19.89x.
Balance Sheet Highlights
The company’s assets totaled $103.15 billion (2023: $89.67 billion), representing a 15% YoY growth, reflecting a solid financial position. This growth is attributed to a significant rise in several assets, which includes receivables, ending the quarter at $23.57 billion (2023: $19.24 billion), reflecting a 22% YoY growth. Investments increased 46% YoY closing the period at $1.76 billion (2023: $1.20 billion), and Inventories closed the quarter at $25.29 billion, representing a 6% YoY growth.
Shareholder’s equity ended the quarter, closing at $28.68 billion (2023: $24.97 billion), representing a book value per share of $39.10 (2023: $34.04). This 15% YoY is ascribed to a 15% YoY Retained Earnings account and a 26% return in the Capital Reserve account. The increase in shareholder equity is a testament to management’s commitment to creating value for our shareholders.
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