ELITE reports 16% decrease in nine months net profit

May 26, 2020

Elite Diagnostic Limited (ELITE) for the nine months ended March 31, 2020 booked a 20% increase in revenue to total $347.29 million compared to $289.25 million for the same period in 2019. Revenue for the third quarter rose by 4% to $111.37 million (2019: $107.01 million). Management noted, “The breakdown of MRI and CT equipment at the Kingston locations were unusually lengthy amounting to a potential revenue loss of $12 Million. Both CT and MRI in the Kingston locations were repaired during the quarter. Revenues at the St. Ann location under-performed due to the breakdown of CT and MRI. We continue to have challenges with getting the 2 machines operational. The company revenues were also impacted by the COVID-19 outbreak towards the end of the 3rd quarter.”

Direct costs for the nine months increased 41%, closing at $126.68 million, up from $89.59 million reported the prior year, while for the third quarter there was a 25% increase in direct costs, closing at $38.68 million (2019: $31.05 million).

As such, gross profit for the nine months amounted to $220.61 million, a growth of 10% when compared to $199.66 million recorded last year. However, gross profit for the third quarter decreased 4% from $75.96 million in 2019 to $72.69 million for the corresponding quarter in 2019.

Administrative expenses climbed by 8% for the nine months to total $129.03 million (2019: $119.43 million). Depreciation and amortization increased 32% to total $55.20 million relative to the $41.80 million booked in 2019. This resulted in profit from operations of $36.38 million for the nine months ended March 31,2020, a 5% decrease relative to $38.43 million booked a year ago.

Finance cost for the nine months totalled $15.62 million, an increase of 13% when compared to the $13.82 million recorded for the same period last year, while exchange loss amounted to $1.69 compared to a loss of $1.80 million the prior year.

Profit before tax for the nine months ended March 31,2020 totalled  $19.07 million compared to $22.81 million recorded last year, a decline of 16% year over year. Loss before tax for the quarter amounted to $2.05 million relative to a profit before tax of $16.02 million booked for the prior year’s corresponding quarter.

Net profit for the period totalled $19.07 million relative to $22.81 million recorded the prior financial year’s corresponding period. Net loss for the quarter amounted to $2.05 million, compared to a net profit of $16.02 million booked for the same quarter in prior year.

Earnings per share (EPS) for the period totalled $0.05 (2019: $0.06). Loss per share (LPS) for the third quarter amounted to $0.01 relative to an EPS of $0.05 in corresponding quarter of 2019. The trailing twelve-month EPS amounted to $0.14. The number of shares used in our calculations amounted to 353,400,000 units. ELITE’s stock price closed the trading period on May 22, 2020, at $3.40.

ELITE stated that, “the company expects performance to be negatively impacted by Covid-19 for the upcoming quarters. The company has taken prudent steps to mitigate the risk of COVID-19 on our staff and patients.”

Balance Sheet at a glance:

As at March 31, 2020, total assets amounted to $687.31 million, down $3.14 million from the balance of $690.45 million as at the previous year. The decrease in total assets was as a result of the 55% decrease in ‘Cash and Cash Equivalents’ which closed at $70.39 million relative to $155.03 million as at March 31, 2019. This was tempered by a 14% increase in ‘Property, Plant and Equipment’ from $507.76 million to $580.38 million in 2020.

Shareholders’ equity of $470.28 million was reported (2019: $422.30 million) which resulted in a book value per share of $1.33 (2019: $1.19).

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