KREMI reports 98% decline in first quarter net profit

July 15, 2022
Caribbean Cream Limited (KREMI)

Unaudited Financials for the three months ended May 31, 2022:

Caribbean Cream Limited (KREMI), for the three months ended May 31, 2022, reported a 12% increase in revenue to total $611.75 million compared to $548.45 million booked in the previous quarter. Management noted that, “The company increased prices while we work to maintain volumes through greater on the ground presence and adaptive media programmes. We are cognizant of the steady rise in inflation and review prices more frequently, as we continue to provide quality products to our customers.”


Costs of sales amounted to $447.36 million (2021: $340.92 million), an increase of 31%. Gross profit declined by 21% or $43.13 million to $164.39 million compared to $207.53 million for the quarter ended May 31, 2021. The company stated that, “the main drivers for the higher costs were raw material price increases and higher utility costs as the company faced rapid and substantial price increases both locally and internationally.”


Administrative Expenses climbed 9% to close at $136.84 million (2021: $125.61 million), while selling and distribution costs fell by 2% from $15.22 million in 2021 to $14.94 million for the period under review. Operating profit for the quarter amounted to $13.42 million, down 80% relative to $66.70 million booked in 2021. The company noted that, “weekly fuel increases impact our utility costs, particularly, electricity, and drives up the cost of a wide range of our materials and services.”


In addition, finance cost rose 139% year over year to $12.03 million relative to $5.03 million recorded in 2021. Furthermore, the Company reported a 45% decrease in interest income for the quarter from $229,852 reported in 2021 to $127,501 in 2022.


Taxation amounted to $189,312 relative to a charge of $7.74 million in 2021. This resulted in a net profit of $1.33 million, a decline from a profit of $54.16 million reported in 2021.


Consequently, Earnings per Share (EPS) for the quarter amounted to $0.0035 (2021: EPS of $0.27). The trailing twelve months LPS amounted to $0.164. The number of shares used in these calculations were 378,568,115 units. KREMI’s stock price close the trading period on July 15, 2022, at a price of $4.74.   Balance Sheet Highlights:

The Company’s assets totalled $1.78 billion (2021: $1.42 billion). The movement was largely due to an increase of $388.16 million in ‘Property, Plant and Equipment’ to a total of $1.25 billion (2021: $862.65 million). Also contributing to the increase was ‘Account receivables’ which ended $140.14 million relative to $58.50 million reported in 2021.

Shareholders’ equity amounted to $799.83 million (2021: $888.09 million), representing a book value per share of $2.11 (2021: $2.35).


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