LASM reports 92% increase in year end net profit

Date: May 31, 2019

Lasco Manufacturing Limited (LASM) for the year ended March 31, 2019, Total revenue increased by 14% from $6.66 billion in 2018 to $7.57 billion in 2018. Revenue increased 41% for the fourth quarter to a total of $1.95 billion, relative to the $1.38 billion recorded for the comparable period in 2018.

Cost of sales amounted to $4.81 billion (2018: $4.37 billion) for the period, an increase of 10% year on year. For the quarter, cost of sales was recorded at $1.13 billion relative to $756.13 million in 2018.  As a result, gross profit of $2.76 billion was recorded for the period, 20% more than the $2.29 billion booked for the corresponding period in 2018. Gross profit for the quarter increased 31% to $821.36 million when compared to the $627.38 million booked for the similar quarter ended 2018.

LASM posted other income of $1.84 million relative to $3.41 million for the prior year.

Operating expenses increased 5% to close the period at $1.50 billion versus $1.43 billion booked for the corresponding period last year.  Of this, administrative and other expenses climbed 7% to $1.21 billion (2018: $1.13 billion), while selling and promotion expenses fell 5% to $285.96 million (2017: $300.57 million). Management noted, “this increase was in line with expectations given and revenue growth achieved”. Expenses for the quarter also reflected an increase of 4% to close at $479.90 million (2018: $462.61 million).

Consequently, LASM recorded operating profits of $1.26 billion, 46% higher than the $861.27 million booked in 2018.

Finance costs for the period fell 19% to $107.43 million compared to $132.18 million in the prior year’s comparable period.

As such, profit before taxation amounted to $1.15 billion, an increase of 58% from the $729.09 million recorded for the previous corresponding period. Taxes recorded for the period amounted to $73.67 million compared to $168.54 million incurred for the corresponding period in 2018. Net profit for the year was $1.08 billion, 92% higher than last year’s net profit of $560.56 million. The Company noted, “this profit out-turn was fueled by volume and revenue growth, gross margin improvement and gains in operational efficiencies”. LASM booked $376.27 million in net profit for the fourth quarter, compared $28.04 million for the corresponding quarter in 2018.

As such Total Comprehensive Income for the year ended totaled $1.08 billion compared to $615.95 million in 2018, an increase of 75%.

Consequently, earnings per share (EPS) for the period amounted to $0.26 relative to $0.14 in 2018. The EPS for the quarter amounted to $0.092 relative to $0.007 reported for 2018. The number of shares used in the calculations amounted to 4,091,163,151 units. Notably, LASM’s stock price closed trading on May 30, 2019, at $3.47.

Balance sheet at a Glance:

Total assets increased 14% year on year, totaling $8.79 billion (2017: $7.72 billion) as at March 31, 2019. The increase in total assets over the period was mainly due to a $723.93 million increase in ‘Cash and Cash Equivalents’ to a total of $918.72 million (2018: $194.80 million)

Total shareholder equity amounted to $5.85 billion as at March 31, 2109 (2018: $4.92 billion). Consequently, book value per share amounted to $1.43 relative to $1.20 in 2018.

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