CAC reports 94% decline in six months net profit

Date: June 17, 2019

CAC 2000 (CAC), for the six months ended April 30, 2019, reported revenues of $516.48 million versus $623.44 million booked in 2018. Revenues for the quarter fell by 9% to $350.06 million (2018: $383.93 million).

Cost of sales fell by 8% for the period to $342.83 million (2018: $374.27 million). Consequently, gross profit for the period declined by 30% closing at $173.65 million compared to $249.17 million for the same period last year. For the quarter, gross profit decreased 29% to $119.09 million (2018: $166.75 million).

The Company reported a 4% increase in total expenses to $204.16 million (2018: $195.50 million). This was as a result of a 8% increase in General Administration to $193.64 million (2018: $178.53 million), which was tempered by a downward movement in Selling & Distribution to $10.52 million (2018: $16.97 million). For the quarter, the Company reported a 15% decline in total expenses which closed the quarter at $92.37 million (2018: $109.25 million).

Other income of $47.14 million was recorded for the period under review, up from $4.42 million reported for the same period in the prior year. Consequently, profit before taxation and finance cost fell by 71% to $16.64 million (2018: $58.09 million).

Net finance costs went up to $13.57 million (2018: $4.43 million). Of this, interest expense for the six months amounted to $11.35 million (2018: $11.10 million). Interest income closed at $134,283 (2018: $468,005) whereas other gains and losses closed at $2.35 million versus other gains of $6.20 million reported in the same period last year.

Profit before taxation amounted to $3.07 (2018: $53.65 million). No taxes were recorded for the period (2018: nil) as such net profit for the six months fell by 94% to $3.07 million (2018: $53.65 million). Net profit for the quarter was reported at $40.76 million compared to $55.88 million booked in the corresponding quarter of 2018.

Earnings per share (EPS) for the six months amounted to $0.02 compared to $0.42 in 2018, while for the quarter EPS amounted to $0.32 versus $0.43 documented in the prior comparable quarter. The twelve months trailing EPS amounted to $0.19. The number of shares used in our calculations is 129,032,258 units. Notably, CAC’s stock price closed the trading period on June 14, 2019 at a price of $12.40.

CAC noted that, “while the GOJ has projected completion of the Three Miles road construction for end June 2019, based on our daily experience from the construction zone, we expect that our operations will continue to be affected for the remainder of the financial year, but we will be able to operate normally, and in some wats even better, next year.”

 Balance Sheet Highlights:  

As at April 30, 2019, the Company reported total assets of $1.10 billion, a 7% decline when compared to $1.18 billion a year ago. This was as a result of ‘Property, Plant & Equipment’ and ‘Cash and Bank Deposits’ which closed at $49.73 million (2018: $61.63 million ) and $162.77 million (2018: $261.13 million), respectively. This was however tempered by an upward movement in ‘Inventories’ which amounted to $294.78 million (2018: $262.31 million).

Shareholders’ Equity as at April 30, 2019 was $490.60 million compared to $476.74 million a year ago. This resulted in a book value per share of $3.80 compared to $3.69 in 2018.

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.