Date: August 15, 2019
Lasco Financial Services (LASF), recorded for the three months ended June 30, 2019, a total of $585.80 million in Trading Income; this represents a growth of 11% relative to the $526.05 million recorded in the comparable quarter in 2018. Other Income for the quarter amounted to $68.67 million, a rise of 141% compared to $28.47 million in 2018. LASF stated, “This increase is driven by growth in transactions mainly from the loans business over the corresponding period.”
Consequently, this resulted in an overall gross profit of $654.47 million for the quarter, a growth of 18% compared to $554.51 million in 2018.
Operating Expenses for the period amounted to $476.16 million which is 25% more than the $382.26 million recorded in June 2018. Selling and Promotional Expenses increased 26% to close at $229.65 million relative to $181.79 million in 2018, while Administrative Expenses rose 23% to close at $246.51 million (2018: $200.46 million). Management noted, “this was as a result of transformational expenses, taxation, finance cost for working capital and growth in staff which we are expecting to reap the associated synergies in the future.”
As a result, Profit from Operations for the period grew by 4% to total $178.31 million relative to $172.26 million that was recorded in the prior period in 2018.
Finance Cost amounted to $48.56 million for the quarter (2018: $40.70 million), increasing by 19%. This resulted in Profit before Tax of $129.75 million, a 1% decrease comparative to $131.56 million in 2018.
After taxation of $38.66 million (2018: $31.04 million), Net Profit for the quarter amounted to $91.09 million which was a 9% decline from the prior period’s net profit of $100.52 million.
Earnings per Share for the quarter amounted $0.07 (2018: $0.08). The number of shares used in the calculation was 1,264,994,391. The twelve months trailing EPS is $0.22. The stock price as at August 14, 2019 closed at $6.34.
LASF mentioned, “LFSL the parent continues to focus on its core activities; Cambio and Remittance services in Jamaica while improving our delivery channels and LASCO Microfinance Limited will concentrate on providing credit in pursuit of financial inclusion and to create an impact on economic development.”
Balance Sheet Highlights:
As at June 30, 2019 the company’s assets totaled $4.03 billion, $481.30 million more than its value of $3.55 billion a year ago. This increase in total assets was largely driven by increases in ‘Receivables’ and ‘Intangible Assets’ which closed at $2.66 billion (2018: $1.85 billion) and $874.76 million (2018: $841.39 million) respectively. However, ‘Cash and cash equivalents’ drastically declined by 73% from $455.53 million in 2018 to total $124.81 million in 2019. The Company highlighted, “the decrease was mainly due to continuous growth in the loans portfolio and an increase in other operational receivables which was subsequently settled after the quarter.”
Total Stockholders’ equity as at June 30, 2019 closed at $1.68 billion an increase of 14% compared to the $1.47 billion reported in 2018. This resulted in a book value per share of $1.33 (2018: $1.16).
Analyst Certification -This research report is for information purposes only and should not be construed as a recommendation. 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.