May 14, 2019
Fontana Limited (FTNA) for the nine months ended March 31, 2019, recorded a 7% increase in revenues to total $3.11 billion compared to $2.90 billion for the same period in 2018. Revenue for the third quarter went up by 7% to $9.51 million (2017: $890.28 million).
Cost of Sales for the period increased 6%, closing at $2.06 billion, up from $1.95 billion reported the prior year, while for the third quarter there was a 4% increase closing at $654.55 million (2018: $631.17 million).
As such, gross profit for the nine months amounted to $1.04 billion, a 10% uptick when compared to $953.39 million recorded last year. However, gross profit for the third quarter rose 14% from $259.12 million to $296.57 million for the corresponding period in 2018.
Administrative expenses climbed by 11% for the period, to total $720.59 million versus $651.90 million in 2018, while selling and promotion closed the nine months at $52.54 million (2018: $54.22 million). FTNA stated, “this increase was driven mainly by the investment in building capacity by improving the human resource capabilities of the company.”
As such operating profit saw a 10% increase to $270.84 million relative to $247.27 million booked a year ago. Operating profit for the quarter closed at $41.56 million (2018: $26.18 million).
Finance Cost for the nine months totalled $51.40 million, an increase of 15% when compared to the $44.82 million recorded for the same period last year, while other income amounted to $25.05 million relative to $24.28 million the prior year. FTNA noted, “finance expenses included a loss on the revaluation of our foreign currency denominated accounts as at March 31, 2019. This accounted for a $5.3 difference between this quarter and the corresponding quarter of the previous year.”
This resulted in profit before taxation totalling $244.48 million compared to $226.73 million recorded last year, an 8% growth year over year. For the quarter profit before taxation moved from $19.72 million in 2018 to $29.78 million in 2019.
Income taxes for the period was $39.81 million versus $41.71 million for the comparable period in 2018. Net Profit increased by 11% to end the period at $204.67 million relative to $185.02 million recorded the prior financial year. Net profit for the quarter amounted to $29.78 million, an 85% jump compared to $16.09 million booked for the prior quarter of 2018.
Earnings per share (EPS) for the period totalled $0.164 (2018: $0.148). EPS for the third quarter amounted to $0.02 (2018: $0.01). The twelve months trailing earnings per share amounted to $0.21. The number of shares used in our calculations amounted to 1,249,374,825 units. FTNA’s stock price closed the trading period on May 14, 2019, at $ 4.52.
Management indicated, “Fontana continues to focus on the sustainable development and has diversified its energy sources in an ongoing effort to reduce its carbon footprint and reduce overall expenses. Our Fairview Montego Bay location now boasts 525 Zorlu solar panels commissioned in February 2019 with a total generating capacity of up to 150 kW. In addition, Fontana has moved quickly to play their role in eradicating non-essential plastics from the commercial ecosystem with the environmentally friendly options.” FTNA also noted, The company’s launch of the ‘Fontana Best Mommy & Baby’ program for pregnant and newborn mothers, highlights our strategic focus on improving the welfare of mothers’ and children’s health through education. This program is a new private/public sector partnership of Fontana Pharmacy with the Government of Jamaica, under the patronage of The Most Honourable Mrs. Juliet Holness, MP. ‘Fontana Best Mommy & Baby’ provides, for the first time in Jamaica’s history, comprehensive best practice antenatal and postnatal information in easily accessible formats. So far 100,000 booklets have been printed, along with posters and videos, and will be disseminated through all hospitals and health clinics in the country.”
Balance Sheet at a glance:
As at March 31, 2019, total assets amounted to $1.83 billion, up $410.06 million from $1.42 billion as at the previous year. The increase in total assets was as a result of the increase in ‘Deposit on Asset’ and ‘Cash and Cash equivalents’ which closed the period by $250.30 million (2018: $18 million) and $418.35 million (2018: $138.70 million) respectively.
Shareholders’ Equity of $1.16 billion was reported (2018: $1 billion) which resulted in a book value per share of $0.93 (2018: $0.80).
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