CAR reports 15% decline in six months net profit

November 15, 2022

Carreras Limited, for the six months ended September 30, 2022, reported Operating Revenue of $7.53 billion, a 5% increase relative to $7.19 billion booked in 2021. Revenue for the quarter inched up 7% to $4.04 billion (2021: $3.76 billion). According to CAR, “This was mainly attributable to the increase in volumes achieved over the period as well as improvements in the portfolio mix.”

Cost of Operating Revenue also increased year over year by 10%, amounting to $4.07 billion from $3.72 billion booked twelve months earlier. As such, Gross Operating Profit fell by 1% to total $3.45 billion relative to the $3.47 billion in 2021. Gross operating profit for the quarter improved 4% to $1.89 billion (2021: $1.82 billion).

Other Operating Income fell by 76% moving from $71.91 million in 2021 to $17.25 million for the period under review.

Administrative, distribution and marketing expenses increased to $1.31 billion (2021: $999.19 million). Impairment loss on trade receivables amounted to $1.48 million relative to the loss of $289,000 for the period ended September 30, 2021.

Profit from operation amounted to $2.16 billion (2021: $2.54 billion) for the six months ended September 2022. CAR profit from operation for the quarter reflected a 12% decline to $1.23 billion compared to $1.40 billion reported as at September 2021. Interest income closed the period at $26.39 million (2021: $21.05 million) year to date. Also, interest expense closed at $9.45 million (2021: $ 9.19 million) for the period.

Profit before income tax closed the period at $2.18 billion relative to $2.55 billion in 2021. Taxation of $558.51 million was incurred for the year to date (2021: $650.38 million).

Consequently, Net Profit year to date fell by 15% to $1.62 billion relative to $1.90 billion booked in 2021. Net profit for the quarter closed at $923.10 million, down 11% from the $1.04 billion booked for the similar quarter of 2021.

The earnings per share (EPS) for the period was $0.33 as compared to $0.39 for the corresponding period of last year. EPS for the quarter amounted to $0.19 (2021: $0.21). The twelve-month trailing EPS amounted to $0.90. The number of shares used in the computations amounted to 4,854,400,000 units. CAR’s stock price last traded on November 14, 2022 at $8.95 with a corresponding P/E of 9.97 times.

The Company noted, “The Financial Year 2022/23 will be a year of broad investment within the company as we seek to revitalize our core brands and maximize on the opportunities presented to engage. This investment will enable Carreras Limited to deliver more sustained results into the future. We will continue to invest in our core brands, Craven A and Matterhorn as we aim to exceed the expectation of our stakeholders. This investment in our consumers have borne fruit driven by the level of revenue increases which have been realized in the first half of the year, and this is expected to continue throughout the financial year.”

Balance Sheet Highlights:

Total Assets amounted to $4.61 billion as at September 30, 2022, up from $4.51 billion reported in 2021. This was mainly due to an increase in ‘Accounts receivable’ totalling $2.19 billion (2021: $1.77 billion). The overall movement was tempered by a decline in ‘Cash and cash equivalents’ which amounted to $1.04 billion (2021: $1.12 billion).

Shareholders’ Equity attributable to stockholders of parent amounted $1.96 billion (2021: $2.01 billion) with book value per share of $0.40 (2021: $0.42).


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