Date: January 15, 2018
Caribbean Cream Ltd. (KREMI) for nine months ended November 30, 2017, reported a 12% increase in revenue during the period totalling $992.24 million compared to $885.63 million in the corresponding period last year. Revenue for the third quarter rose 18% to close at $318.98 million compared to $270.73 million for the comparable quarter of 2016. Management indicated, “Revenue and market share growth have been achieved by maintaining retail prices despite increasing costs. This has impacted profitability.”
Costs of Sales amounted to $686.80 million (2016: $541.57 million), an increase of 27%. According to KREMI, “costs for the period continued to increase due to escalating commodity prices of some ingredients.” Nevertheless, Gross Profit fell 11% or $38.62 million to $305.44 million compared to $344.06 million for the period ended November 30, 2016. The company booked gross profit of $85.32 million for the third quarter versus $89.23 million reported for the similar quarter of 2016.
Administrative Expenses climbed 15% to close at $193.34 million (2016: $168.12 million), while Selling and Distribution Costs slid 6% from $35.99 million to $33.68 million. The company highlighted to growth in administrative expenses was as a result of increased personnel, maintenance and utilities cost. Consequently, operating profit for the nine months period amounted to $80.12 million, down 43% relative to $141.72 million book in 2016.
Finance Cost rose 41% year over year to amount to $12.26 million relative to $8.71 million recorded in the nine months ended November 30, 2016. KREMI highlighted, “there was an increase in finance cost to secure bank commitment to finance upcoming CAPEX projects.” Interest income for the period reflected a marginal decline from $3.76 million to $3.29 million for the nine months.
No taxes were charged for the period, as such Net Profit Attributable to Shareholders decreased by 48% from $136.77 million in 2016 to $71.15 million. Profit for the quarter amounted to $652,605 (2016: $19.19 million), down 97% year over year. Consequently, Earnings per Share (EPS) for the period amounted to $0.19 (2016: $0.36), while the EPS for the quarter totalled $0.002 (2016: $0.051). The trailing twelve months earnings per share amounted to $0.28. The numbers of shares used in these calculations were 378,568,115 units. KREMI’s stock price close the trading period on February 21, 2018 at a price of $5.00.
Balance Sheet Highlights:
The company’s assets totalled $802.5 million (2016: $738.03 million), $64.52 million more than its value as at November 30, 2016. The increase in assets was largely due to an increase of $108.51 million in ‘property, plant and equipment to a total of $507.42 million (2016: $398.91 million). Notably, ‘Inventory’ and ‘Cash and Cash Equivalents’ declined as at November 30, 2017 to close as $96.09 million (2016: $109.02 million) and $144.88 million (2016: $176.22 million) respectively.
Shareholders’ equity amounted to $639.57 million (2016: $555.16 million), representing a book value per share of $1.69 (2016: $1.47).
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