ELITE reports 83% decline in first quarter net profit

Date: November 16, 2018

Elite Diagnostics Limited (ELITE), for the three months ended September 30, 2018 reported that Revenue increased by 22% to total $85.44 million compared to $69.82 million for the same period in 2017. The company highlighted, “Revenues from the Liguanea location amounted to $23.7M for the quarter as compared to the previous quarter of $9.6M. All modalities at the Liguanea location, including the 3T MRI, continue to grow and the company has not begun to approach its full utilization.”

Cost of sales for the period showed an increase of 27%, moving from $21.73 million to $27.57 million. As such, gross profit amounted to $57.87 million, an increase of 20% when compared to $48.08 million recorded last year.

Administrative expenses saw a jump of 81%, to total $37.83 million (2017: $20.89 million) while other income amounted to $45,406 (2017: nil). In addition, Depreciation and Amortization amounted to $13.98 million relative to $8.76 million a year ago.

As such, profit from operations totaled $6.11 million, a 67% decline when compared to 2017’s $18.44 million.Foreign gain for the period totaled $9,872 (2017: nil) while the company’s finance cost ended at $4.28 million (2017: $4.13 million).

Profit before tax totaled $1.84 million compared to $14.31 million recorded last year. No taxes were booked for the period relative to $3.58 million booked for 2017.

Thus net profit for the period totaled $1.84 million, compared to $10.73 million the prior financial year. Elite mentioned, “Some of the expenses that weighed on our profits are housing and maintaining the 3rd MRI unit for our new location that has not yet been installed. The increase in depreciation from $8.8M to 14M for the quarter also weighed on our bottom line. There were also non-recurring expenses during the quarter that has affected our net profits.”

Earnings per share for the period totaled $0.005 (2017: $0.030). The twelve-month trailing EPS is $0.102. The number of share used in our calculations amounted to 353,400,000 units. The stock last traded on November 16, 2018 at $3.24.

ELITE also added, “The demand for MRI’s continues to be robust. With the Liguanea location fully operational for a complete quarter, the company expects steady growth moving forward. The opening of the company’s 3rd location in the parish of St. Ann is expected in mid-2019.”

Balance Sheet at a glance:

As at September 30, 2018, total assets amounted to $588.08 million, up $222.18 million from the balance of $365.90 million for last year. This increase in total assets was as a result of the increase in Property, plant and equipment from $245.92 million to $480.45 million.

Shareholders’ Equity of $401.33 million was reported (2017: $234.26 million) which resulted in a book value per share of $1.14 (2017: $0.66)


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