June 17, 2020
Dolphin Cove (DCOVE), for the three months ended March 31, 2020, reported total revenue of US$3.29 million, a 15% decrease when compared to US$3.89 million booked the year prior. Revenue from Dolphin Attraction contributed US$1.79 million to total revenue; this represents a 19% decline when compared to the US$2.20 million reported in the prior year. Revenues from the Ancillary Services totalled US$1.50 million, an 11% decrease from last year’s US$1.69 million. Notably, according to the Company for the first two months, “revenue from programmes increased by 4.5% compared to 2019, and ancillary revenues went up by 11% mainly because of the performance of Yaaman park.”
Total direct cost for the first quarter amounted to US$405,538, a 12% decline when compared to the US$458,509 reported in 2019.
As such, gross profit for the quarter went down by 16%, amounting to US$2.88 million relative to 2019’s total of US$3.43 million.
Other income decreased 10% to US$59,655 relative to US$66,256 booked in 2019.
Total operating expenses fell 14% moving from US$2.51 million in 2019 to US$2.15 million as at March 2020. Of this, administrative expenses totalled US$382,644 (2019: US$670,209) while selling expenses amounted to $643,192 (2019: US$1.03 million). Other operating expenses for the period rose 38% to US$1.13 million (2019: US$816,373). For the first two months, DCOVE noted that, operating revenue fell “as a result of negotiating better deals with suppliers, more constant review of the allocation of resources and stricter supervision of key areas.” Moreover, Management stated that, “We adjusted our incentives and commissions scheme and used our budget on more effective channels of publicity and promotion. We initiated an organizational restructure which allowed us to reduce payroll costs by 10%.”
Finance income rose by 580%, totalling US$60,689 relative to US$8,923 last year while finance cost increased from US$69,348 for the same period in 2019 to US$76,047 as at March 2020.
Profit before taxation saw a decline of 16% to US$777,983 from US$927,728 booked in the prior comparable period.
Following taxation of US$69,069 (2019: US$84,926), net profit for the quarter was US$708,914, 16% less than the US$842,802 booked the prior year.
Total comprehensive income for the quarter ended March 31, 2020 was US$708,914, (2019: US$842,802).
Earnings per stock unit for the three months totalled US$0.0018 relative to US$0.0021 in 2019. The trailing twelve-month EPS amounted to U$0.004. The stock traded at JMD$7.81 as at June 16, 2020. The number of shares used in the calculation was 392,426,376.
As it regards to the effects of COVID-19 pandemic, DCOVE stated that, “In February, there was a decline in the number of visitors to our parks as the Ports Authority imposed strict disembarkation rules which resulted in long delays for passengers to start their tours and some ships were not allowed to dock in Jamaica. On March 21, 10 days after the government declared the first positive case on the Island, we decided to close operations in all our parks consistent with the social distancing recommendation. Consequently, revenue for March 2020 was 53% lower than March 2019.”
Furthermore, Management also noted that, “Dolphin Cove, is now facing a period of no income and declining cash resources. Even with our parks closed we need to make expenditures for animal welfare, security, insurance, utilities, accounts payable and taxes. Fortunately, Dolphin Cove is debt free with a large base of tangible assets and a track record of profitable operations which puts in a good position to access additional cash should this be necessary. Management has been working closely with the directors and senior members of the cruise lines and largest tour operators to have an idea of the expected times for reactivation of the industry in Jamaica, our plan based on these discussions is to resume operations gradually on July 1st.”
Balance sheet Highlights :-
As at March 31, 2020, the Company’s assets totalled US$32.39 million, 1% less than the US$32.84 million reported as at March 31, 2019. The was as a result of a 3% decrease in ‘Property, Plant and Equipment’ to US$21.96 million (2019: US$22.65 million) and ‘Cash and cash equivalents’ to US$820,249 (2019: US$1.28 million). ‘Live assets’ and ‘Accounts receivable’ also decreased to US$4.27 million (2019: US$4.50 million) and US$1.80 million (2019: US$2.06 million), respectively. These decreases were however offset by a 122% increase in ‘Due from related parties’ to US$911,621 (2019: US$410,787).
DCOVE highlighted that, “before the closure of operations, we had great improvement in the collections, which allowed us to declare and pay for the first time a 30-cent dividend to our shareholders. Our working capital was intact at the end of Q1 2020 but has declined in Q2 and collection of receivables has proved more difficult.”
DCOVE closed the three months with shareholders’ equity in the amount of US$28.51 million (2019: US$29.66 million) which resulted in book value per share of US$0.073 (2019: US$0.076).
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