November 16, 2022
Jamaica Producers Group Limited (JP), for the nine months ended September 30, 2022 experienced a 20% increase in revenue to total $21.57 billion compared to the $17.98 billion reported in 2021. The Company posted 9% increase in third quarter revenue to $7.18 billion (2021: $6.58 billion).
The Food & Drink Division was the largest contributor to revenue for the group, ending at $12.80 billion (2021: $10.76 billion). The Company highlighted that, “A.L. Hoogesteger Fresh Specialist B.V. (“Hoogesteger”) is the largest contributor to the revenues and profits of the Division. This business is a market leader in fresh juice in Northern Europe and serves as a copacker of juice for major supermarket and food service entities in the Netherlands, Belgium, Scandinavia and Switzerland. During the year, the Division experienced material increases in costs associated with raw material commodities, personnel, and logistics. We intend to recover these cost increases, to the extent possible, through increases in selling price. The initiative to adjust prices to align with market conditions will continue. We have, however, experienced some margin compression in the instances where we delayed price increases to balance risks to demand or consumer confidence. The adverse impact of reduced margins has to-date been offset by the benefit of solid volume growth.”
The Logistics and Infrastructure Division accounts for the major share of the Group’s net assets and, in turn, its profits. Divisional year-to-date revenues of $8.8 billion (2021: $7.22 billion), up 21% over the prior year.
The Corporate Services division earned revenue of $22.09 million relative to $3.38 million in 2021.
The Cost of Operating Revenue for the nine months increased by 22% to total $15.47 billion compared to $12.70 billion reported for the comparable period in 2021. Gross Profits increased to total $6.10 billion, a 16% uptick relative to the $5.28 billion documented in 2021. Gross profit for the third quarter amounted to $2.10 billion compared to $1.99 billion booked for the same quarter of 2021. Other income decreased to $195.72 million, a 55% contraction relative to $438.63 million booked the prior corresponding period.
JP’s marketing, selling and distribution expenses closed at $3.54 billion, a 23% increase when compared to the $2.89 billion booked a year earlier. As such, profit from operations amounted to $2.75 billion relative to $2.82 billion booked for the corresponding period in 2021. Profit from operations for the quarter amounted to $1.09 billion compared to $1.08 billion reported for the corresponding quarter of 2021. JP also recorded a share of point in joint venture and associated company of $571.72 million relative to $127.78 million in the previous year.
Finance cost was reported at $166.06 million for the period relative to the $170.29 million reported in 2021. This resulted in a profit before taxation of $3.15 billion for the period (2021: $2.78 billion). Profit before tax for the third quarter totalled $1.27 billion versus $1.12 billion reported for the same quarter of 2021.
The Company incurred tax charges of $463.53 million (2021: $499.85 million). As a result, Net Profit for the period rose 18% to $2.69 billion (2021: $2.28 billion). Net profit for the quarter amounted to $1.10 billion versus the $937.84 million booked a year prior. Notably, Net profit attributable to stockholders totalled $1.45 billion; this compares to $1.06 billion, a 37% increase. Net profit attributable to shareholders for the quarter went up to $590.56 million (2021: $454.29 million).
Total comprehensive income for the period under review closed at $1.98 billion (2021: $2.29 billion). While for the quarter, total comprehensive income totalled $831.08 million (2021: $790.02 million).
Earnings per share for the period amounted to $1.30 (2021: $0.95). EPS for the quarter amounted to $0.53 (2021: $0.40), while the twelve-month trailing earnings per share amounted to $1.99. The number of shares utilized in the computations amounted to 1,122,144,036 units. JP stock last traded on November 15, 2022 at $18.30 with a corresponding P/E of 9.19 times.
Balance Sheet Highlights:
As at September 30, 2022, the Company’s Assets totalled $45.89 billion, 6% more than its value of $43.44 billion a year ago. This increase in total assets was due largely to increases in ‘Interest in Associated Companies and Joint Venture’ and ‘Short-term investments, which amounted to $1.44 billion (2021: $381.70 million) and $399.60 million (2021: $706.43 million) respectively.
The Company ended the period with equity attributable to equity holders of the parent in the amount of $18.76 billion relative to $17.19 billion in 2021. The company now has a book value per share of $16.71 versus $15.32 in 2021.
Disclaimer:
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation(s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.