BPOW reports 32% decline in six months net profits

November 30, 2020

For the six months ended October 31, 2020:-

Blue Power Group Limited (BPOW), for the six months ended October 31, 2020 booked a 36% increase in revenue to total $313.84 million compared to $231.43 million for the corresponding period in 2019. Revenue for the quarter totalled $151.99 million, 35% above last year’s corresponding quarter of $112.75 million.

BPOW highlighted, “We had shipped substantial quantities of soap to the United States in the first quarter in order to meet the demand from new customers such as Walmart but the retail sales through these accounts were not sufficient enough yet to justify the same level of reorders for the second quarter as the warehouses of our distributors had adequate stocks. In our main market in the CARICOM region, we were faced with intense competition which resulted in a lower level of export sales.”

Cost of sales for the period showed an increase of 37% to $196.96 million from $144.11 million last year. This further translated into gross profit amounting to $116.88 million, an increase of 34% when compared to $87.32 million in 2019. Gross profit for the second quarter rose 13% to close at $55.32 million (2019: $49.07 million).

Administrative expenses saw an increase of 27%, to total $67.58 million (2019: $53.04 million). Thus, resulting in profit from operations of $38.47 million, 12% more than 2019’s $34.28 million. For the second quarter profit from operations saw a 7% decline to $17.10 million versus $18.40 million in 2019.

Impairment losses on trade receivables closed at $10.83 million (2019: nil).

Other income, for the period totalled $13.49 million a significant increase when compared to the $5.93 million recorded for the same period last year.

In addition, BPOW reported finance costs of $969,696 for the period, a 1723% increase when compared to $53,185 in the year prior. Finance income fell by 17% to $15.53 million relative to $18.71 million for the corresponding period in 2019.

Profit before tax totalled $66.52 million compared to $58.86 million in 2019 followed by tax charges of $16.63 million (2019: $7.28 million).

Net Profit for the period totalled $49.89 million, a 32% decrease compared to $72.88 million booked in 2019, while net profit for the quarter amounted to $16.79 million (2019: $28.19 million).

Total comprehensive income totalled $53.31 million for the period versus $72.88 million las year. While for the quarter, total comprehensive income amounted to $32.75 million (2019: $28.19 million).

Earnings per share (EPS) for the period totalled $0.088 (2019: $0.129). EPS for the second quarter amounted to $0.030 relative to $0.050 twelve months earlier. The twelve-month trailing EPS is $0.10. The number of shares used in our calculations amounted to 564,990,000 units. BPOW’s stock price closed the trading period on November 27, 2020 at $3.25 with a corresponding P/E ratio of 31.88 times.

Balance Sheet at a glance:

As at October 31, 2020, total assets amounted to $1.05 billion, up 5% from the balance of $1 billion as at October 31, 2019. The increase in total assets was as a result of the increase in Investment which increased by 61% to end at $431.65 million (2019: $268.27 million), and Inventories which amounted to $233.69 million (2019: $169.94 million).

Shareholders’ Equity of $1 billion was reported (2019: $958.67 million) which resulted in a book value per share of $1.77 (2019: $1.69).


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