Lasco Manufacturing Limited (LASM) for the six months ended September 30, 2017 recorded a decrease in total revenue of $456.73 million or 12% to total $3.50 billion, relative to the $3.95 billion recorded for the comparable period in 2016. Revenue for the quarter amounted to $1.99 billion, approximately 11% below the $2.22 billion documented for the comparable period in 2016. According to LASM, “revenue for the second quarter was 32% higher than the first quarter reflecting the expected improvement on the first quarter outcome.”
Cost of sales amounted to $2.39 billion (2016: $2.63 billion) for the period, a decline of 9% year on year. As a result, gross profit of $1.10 billion was recorded for the period, 17% less than the $1.32 billion booked for the corresponding period in 2016. Gross profit for the second quarter fell 17% to $624.07 million when compared to the $754.53 million booked for the quarter ended September 30, 2016.
LASM posted other income of $18.33 million relative to $15.22 million for the prior year.
Operating expenses increased approximately 14% to close the period at $669.71 million versus $585.15 million booked for the corresponding period last year. Management indicated, “the increase was primarily due to growth in marketing investments to support our brands in an increasingly competitive environment and a significant increase in depreciation charges.” Expenses for the quarter reflected an increase of 15% to close at $361.34 million (2016: $315.32 million).
Consequently, LASM recorded operating profits of $450.91 million, 40% lower than the $753.67 million booked in 2016. Operating profit for the quarter declined 41% to $267.30 million (2016: $456.48 million).
Finance costs for the year fell 23% to $65.50 million compared to $84.53 million in the prior year’s comparable period.
As such, profit before taxation amounted to $385.41 million, a decrease of 42% from the $669.15 million recorded for the previous year. Taxes recorded for the period amounted to $48.18 million compared to $82.07 million incurred for the corresponding period in 2016. As such Total Comprehensive Income for the first six months totalled $337.23 million compared to $587.07 million in 2016, a contraction of 43%. Total Comprehensive Income for the quarter totalled $202.95 million (2016: $362.98 million).
Consequently, earnings per share (EPS) for the period ended September 30, 2017 amounted to $0.08 relative to $0.14 in 2016. The EPS for the quarter amounted to $0.05 relative to $0.09 reported for 2016. The twelve months trailing EPS amounts to $0.15. The number of shares used in the calculations amounted to 4,087,130,170 units.
LASM stated, “while we continue to make the necessary investments in plant equipment and marketing, we are confident in the outlook for positive growth in revenue and profits during the second half of the year.”
Balance sheet at a Glance:
Total assets increased 5% year on year, totalling $7.65 billion (2016: $7.30 billion) as at June 30, 2017. The increase in total assets over the period was mainly due to a $294.07 million or 225% increase in ‘Capital Work in Progress’ to a total of $424.94 million (2016: $130.87 billion). Property, plant & equipment posted a 3% decline year over to close at $4.35 billion compared to $4.47 billion reported a year earlier. Cash and cash balances and ‘trade and other receivables’ recorded increases of 33% and 6% respectively. Cash and cash balances amounted to $303.33 million (2016: $228.83 million, while trade and other receivables totaled $1.76 billion (2016: $1.66 billion).
Total shareholder equity amounted to $4.65 billion as at September 30, 2017 (2016: $4.32 billion). Consequently, book value per share amounted to $1.14 relative to $1.06 in 2016.
