November 16, 2023

Caribbean Flavours and Fragrances Limited (CFF) for the nine months ended September 30, 2023, reported a 19% increase in Revenue totaling $668.27 million compared to $561.94 million in the corresponding period last year. Revenue for the third quarter had a 17% increase to close at $236.19 million compared to $202.08 million for the comparable quarter of 2022.

CFF highlighted, “This substantial improvement arose from increased orders in our flavours segment with special orders being the key growth segments during the quarter. Our expanded product range for bakeries was our key highlight of the third quarter s we gained new customers both locally and internationally who have requested products to integrate into their product lines”.

Cost of Sales amounted to $438.27 million (2022: $388.56 million), this represents an increase of 13% year over year. Consequently, gross profit increased by 33% to $230.00 million compared to $173.38 million for the nine months ended September 30, 2022. The company booked gross profit of $86.15 million for the third quarter versus $57.59 million reported for the similar quarter of 2022.

Administrative Expenses increased by 23% to close at $132.26 million (2022: $107.75 million), while Selling & Distribution costs increased by 19% from $3.34 million in 2022 to $3.99 million in the period under review. As a result, total expenses for the nine months ended September 30, 2023 amounted to $136.25 million, a 23% increase relative to $111.09 million reported in 2022. Higher utility and security costs as well as a significant increase in general insurance were the main factors driving the company’s total expenses.

Operating profit for the nine months ended September 30, 2023, amounted to $93.76 million, a 51% increase relative to $62.29 million reported in 2022. Operating profit for the third quarter amounted to $36.77 million (2022: $12.65 million).

Finance Income totalled $12.28 million, a 133% increase from the corresponding period last year. (2022: $5.27 million).

Pre-tax Profit for the nine months ended September 30, 2023, amounted to $106.03 million, a 57% increase relative to $67.56 million reported in 2022. Pre-tax Profit for the third quarter amounted to $37.82 million (2022: $16.80 million).

Taxation for the nine months ended September 30, 2023 had a 69% increase to reach $13.50 million (2022: $8.00 million).

Net Profit for the nine months amounted to $92.53 million, a 55% increase from the $59.56 million reported in 2022. For the third quarter, Net Profit was $31.82 million (2022: $14.80 million).

Consequently, Earnings Per Share for the nine months amounted to $0.10 (2022: EPS: $0.07), while Earnings Per Share for the quarter totaled $0.04 (2022: EPS: $0.02). The twelve-month trailing EPS was $0.11 and the number of shares used in these calculations was 899,200,330.

Notably, CFF’s stock price closed the trading period on November 15, 2023 at a price of $1.39 with a corresponding P/E ratio of 13.20x.

Balance Sheet Highlights

The company’s assets totalled $847.76 million (2022: $765.51 million). The growth in total assets was driven primarily by a 200% increase in ‘Due from related parties’ to close at $96.84 million (2022: $25.48 million).

Shareholder’s equity was $656.38 million (2022: $584.19 million), representing a book value per share of $0.73 (2022: $0.65).

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