May 15, 2020
Caribbean Flavours and Fragrances (CFF) revenues increased by 33% to $149.39 million relative to $112.58 million for the comparable period in 2019. CFF stated that, “the Company’s improved performance this quarter was driven by a growth in sales in both the local and overseas markets. During this quarter and as a response to the pandemic, we developed and manufactured hand sanitizer for internal uses as well as availing to the trade of which additional revenue was generated.”
Cost of sales amounted to $101.55 million relative to $75.29 million in the prior corresponding period. Consequently, gross profit went up 28% to close at $47.84 million for the period under review, compared to the prior year’s figure of $37.29 million. Management noted that, “we will continue with the refinement of our strategies and increase our focus on the improvement to our various cost structures in order to drive the desired efficiency whilst improving our cost of sales and gross profit. The impact from the continued depreciation of Jamaican Dollars will have a negative impact on our cost of sales given the timing and immediacy to which some of these adjustments are made.”
The Company recorded a year over year increase in total expenses to $31.95 million, up from $26.14 million in 2019. There was a 491% increase in selling and distribution costs to total $1.76 million (2019: $297,000). Whereas, administrative expenses for the period went up 17% to $30.19 million versus $25.84 million in the prior year’s corresponding period.
Consequently, profit from operations for the period closed at $15.89 million versus $11.15 million booked twelve months earlier.
Pretax profit closed at $18.96 million (2019: $14.45 million). As a result, after incurring taxes $4.74 million (2019: $2.51 million), net profit for the period increased 19% to $14.22 million compared to $11.93 million documented in the same period last year. CFF mentioned that, “this increase is driven by the continued focus, which has been placed on efficiency, cost management, introduction of new products and the broadening of revenue streams within both the local and international markets.”
Moreover, Management stated that, “the Company’s 100% remission of taxes expired in October 2018. The Company’s profits are now subject to 50% of remission of taxes to October 2023.”
The earnings per share for the period amounted to $0.16 (2019: $0.13). The twelve months trailing EPS is $0.38. The number of shares used in this calculation was 89,920,033 units. As at May 15, 2020 the stock traded at $10.00.
Balance Sheet Highlights:
The Company, as at March 2020, recorded total assets of $567.96 million, an increase of 22% when compared to $466.13 million for the prior year. ‘Short-term investments’ contributed to this growth, closing the period at $209.24 million (2019: $154.40 million).
Total Shareholders’ equity as at March 2020 closed at $444.40 million, an improvement of 1% from $439.09 million last year. This resulted in a book value per share of $4.94 (2019: $4.88).
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