CAC reports 48% increase in nine months net profit

October 12, 2021

CAC 2000 Limited’s (CAC) ‘Revenues’ for the nine months ended July 31, 2021 decreased 12% to $820.20 million relative to $928.23 million for the comparable period in 2020. ‘Revenues’ for the third quarter decreased by 12% to $311.68 million compared to $354.68 million for the same period the prior financial year.

‘Cost of Sales’ also decreased by 18% for the period to $499.59 million (2020: $609.26 million). Consequently, ‘Gross Profit’ for the period improved by $1.63 million or 1% to $320.61 million (2020: $318.98 million) when compared to 2020 corresponding period. For the quarter, ‘Gross Profit’ fell 1% to close at $111.82 million (2020: $114.36 million).

The Company reported a 1% decrease in ‘Total Expenses’ to $291.92 million (2020: $295.53 million). ‘General Administration’ amounted to $275.85 million (2020: $276.61 million), however, there was a 15% downward movement in ‘Selling & Distribution Expenses’ to $16.06 million (2020: $18.92 million). For the quarter, the Company reported a 25% increase in ‘Total Expenses’ which closed at $100.71 million compared to $81.27 million in 2020.

CAC noted, “overall expenses continue their downward trend over the previous year, and we expect this trend to continue as we streamline our processes and procedures following the implementation of the ERP System.”

‘Other Income’ of $1.55 million was recorded for the period down from $2.36 million reported for the same period the prior year. ‘Profit before Taxation and Finance Cost’ amounted to $30.24 million, versus a profit of $25.81 million booked in 2020.

Other Losses amounted to $3.52 million for the period under review relative to other gains of $3.35 million booked in 2020.

‘Net Finance Costs’ increased 20% for the period in review to $22.36 million from $18.57 million recorded twelve months earlier. As a result of; ‘Interest Expense’ and ‘Interest Income’ for the nine months amounting to $18.88 million relative to $22.18 million in 2020 and $40,388 relative to $263,085 in 2020, respectively.

‘Profit Before Taxation’ for the nine months closed at $7.87 million relative to a profit of $7.24 million booked in 2020. Tax credit amounted to $2.87 million for the period under review (2020: nil), as such, ‘Net Profit’ for the nine months closed at $10.74 million versus a profit of $7.24 million booked in 2020. ‘Net Profit’ for the quarter was reported at $2.04 million compared to a profit of $28.77 million for the corresponding quarter of 2020.

Earnings-per-share (EPS) for the nine months amounted to $0.08 compared to an EPS of $0.06 in 2020, while for the quarter the EPS amounted to $0.02 versus an EPS of $0.22. The twelve months trailing EPS amounted to $0.28. The number of shares used in our calculations is 129,032,258 units. Notably, CAC’s stock price closed the trading period on October 11, 2021 at a price of $7.02 with a corresponding P/E of  25.14 times.

CAC stated that, “The new Enterprise Resource Planning (ERP) system implemented on April 1, 2021, as a soft launch has now cut over in most areas of the business as of June 1, 2021. This change addresses our strategic priority of improving our overall operational effectiveness through improved reporting, analytics and overall cost containment. As with all conversions there are hiccups, but we are already seeing the benefits of converting to an ERP system now.”

Balance Sheet Highlights:   

As at July 31, 2021, the Company reported total assets of $1.14 billion, a 6% decrease when compared to $1.21 billion a year ago. This was as a result ‘Short term investments’ which decreased 99% to $425,389 (2020: $29.13 million).

Shareholders’ Equity as at July 31, 2021 was $399.09 million compared to $374.19 million a year ago. This resulted in a book value per share of $3.09 compared to $2.90 recorded in 2020.


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