October 16, 2019

AMG Packaging Limited (AMG), for the year ended August 31, 2019 recorded turnover in the amount of $762.30 million (2018: $718.92 million), an increase of 6% when compared to 2018. For the quarter turnover was down 3% to close at $174.68 million (2018: $180.17 million).

Total cost of sales amounted to $594.33 million, an increase of 7% relative to the corresponding period in 2018 of $555.62 million. Contributing to the increase in cost of sales was direct expenses which rose $13% to 145.88 million relative to $129.48 million. Cost of inventories also increased year over year by 5% to close at $448.44 million (2018: $426.14 million).

Consequently, gross profit amounted to $167.97 million, 3% up from $163.29 million reported for the prior year. For the fourth quarter gross profit closed the period at $42.62 million relative to $41.16 million in 2018.

Administrative expenses fell by 5% to close at $81.53 million versus $85.94 million reported in 2018. Financial costs fell year over year by 8% to a total of $5.13 million (2018: $5.60 million). Director’s fees contracted 8%, while depreciation expense recorded a 7% increase from $18.54 million booked in 2018 to $19.76 million for year ended August 31, 2019. Director’s Fees closed FY2019 at $11.41 million relative to $12.40 million reported in 2018.

As such, profit before tax closed at $52.05 million for 2019, 17% more than the $44.44 million booked last year. Taxes $5.13 million was reported for the financial year compared to a tax credit of $2.57 million in 2018. Income from continuing operations amounted to $46.92 million compared to $47 million in 2018.

The Company incurred a loss from discontinued operations of $70.35 million for 2018 (2019: Nil). As such, total comprehensive income for year closed at $46.92 million relative to a loss of $23.35 million in 2018. Total comprehensive income for the quarter amounted to $11.03 million in contrast to a comprehensive income of $7.43 million for the corresponding quarter of 2018.

Earnings per share (EPS) for the year amounted to $0.09 versus a loss per share of $0.05), while the loss per share for the quarter was $0.02 (2018 EPS: $0.01). The number of shares used in our calculations amounted to 511,894,285 units. AMG last traded on October 16, 2019 at $1.90.

Management has indicated, “the Company has obtained funding from Proven Wealth Limited to assist with the development of 12 Retirement Crescent. The KSAC is in the process of reviewing the architectural drawings for 12 Retirement Crescent.” Additionally, “the Company has begun the investigation on new equipment that will assist with production speeds and efficiency. AMG has joined the AICC, The Independent Packaging Association to help with this investigation and future projects.”

Balance Sheet Highlights:

As at August 31, 2019, total assets amounted to $716.08 million, compared to its  value of $747.01 million a year ago.  This decrease was attributed to a declined in inventories which amounted to $179.01 million relative to $259.80 million in 2018. The downward movement was tempered by an increase in ‘Cash & Cash Equivalents’ which totalled $90.47 million (2018: $46.67 million).

Shareholder’s Equity as at August 31, 2019 totalled $501.74 million (2018: $454.83 million) resulting in a book value per share of approximately $0.98 (2017: $0.89).

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