November 11, 2021

Grace Kennedy Limited (GK) recorded total revenue of $95.78 billion for period (2020: $86.13 billion), a year over year increase of 11%. Of this, Revenue from products and services amounted to $92.36 billion (2020: $82.88 billion) and interest revenue totalled $3.42 billion (2020: $3.25 billion).

The biggest contributor to the Group’s overall revenue for the nine-month period came from the ‘Food Trading’ segment which contributed a total of $75.15 billion (2020: $67.90 billion), an increase of 11% relative to the prior year’s corresponding period.

Revenue for the third quarter of 2021 climbed 10% to $29.59 billion (2020: $25.54 billion).

The other segments contributing to revenue are as follows:

• ‘Banking & Investments’ went up 6% year over year to total $4.96 billion (2020: $4.68 billion).
• Revenue from ‘Insurance’ amounted to $8.45 billion, a year over year increase of 20% over last year’s corresponding period of $7.07 billion.
• ‘Money Services’ brought in $7.21 billion, 11% more than the $6.48 billion reported in September 2020.

Direct and operating expenses amounted to $89.50 billion relative to $80.38 billion booked in 2020, indicating an 11% growth compared to twelve months earlier. Net impairment losses on financial assets totalled $392.40 million (2020: $629.79 million). Whereas direct and operating expenses for the third quarter amounted to $30.25 billion, up from $27.41 billion for the same quarter of 2020.

As such, gross profit for the nine months amounted to $5.88 billion relative to $5.12 billion booked for the similar period of 2020, a 15% increase. Gross profit for the third quarter decreased by 2% to $2.01 billion compared to $2.05 billion reported for the third quarter of 2020.

Other Income during the nine-month period, rose 20% to total $2.71 billion (2020: $2.27 billion).

Interest income from non-financial services rose 9% to total $433.58 million compared to $351.31 million reported in the prior year’s corresponding period. Interest expenses from non-financial services amounted to $858.26 million versus $843.87 million a year earlier, a 2% increase.

Share of results of associated companies fell by 10% amounting to $368.29 million, versus $409.68 million reported for September 2020.

Pre-tax profits increased 17% to $8.54 billion, compared to pre-tax profit of $7.31 billion documented for the nine-month ended September 2020.  Additionally, GK incurred taxation expenses amounting to $2.31 billion compared to $2.37 billion in September 2020.

Consequently, net profit rose 26% to $6.23 billion from $4.93 billion booked for the corresponding period of 2020. Net profit for the third quarter surged 20% to $2.26 billion (2020: $1.88 billion).

Net profit attributable to shareholders amounted to $5.68 billion compared to $4.42 billion in the previous year’s corresponding period, showing a 28% increase. Net profit attributable to shareholders for the third quarter amounted to $2.09 billion, up from the $1.68 billion booked for the same quarter of 2020.

Total comprehensive income closed the nine months at $billion (2020: $7.08 billion). Total comprehensive income for the quarter amounted to $2.20 billion (2020: $5.82 billion).

Earnings per share for the third quarter amounted to $2.10 (2020: $1.69), while for the nine months GK booked an EPS of $5.71 (2020: $4.45). GK’s trailing EPS amounted to $7.09.  The number of shares used in our calculations is 995,012,431 units. GK’s stock price close the trading period on November 11, 2021 at $99.43 with a corresponding P/E of 14.02 times.

Balance Sheet Highlights:

As at September 30, 2021, the Group’s assets totalled $190.10 billion, 13% or $22.27 billion more than the $167.83 billion a year ago.  The improvement resulted in part from a growth in ‘Investment Securities’ and ‘Cash and Deposits’ which closed at $38.18 billion (2020: $32.59 billion) and $27.13 billion (2020: $22.72 billion), respectively.

Shareholders’ equity amounted to $65.07 billion which compares to equity of $56.50 billion as at September 30, 2020.  As a result, book value per share amounted to $65.39 (2020: $56.78).

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