September 14, 2022
The Lumber Depot Limited (LUMBER), for the first quarter ended July 31, 2022, reported revenue of $399.88 million, a 5% decline year over year (2021: $420.08 million).
Cost of sales for the period amounted to $318.15 million (2021: $316.61 million). Consequently, gross profit for the period closed at $81.73 million (2021: $103.47 million).
Moreover, the Company reported an impairment gain on trade receivables of $6.05 million relative to the gain of $6.44 million a year prior.
Administrative and other expenses closed the period at $39.67 million, 8% higher than the $36.75 million in the three months ended July 2021.
As a result, operating profit amounted to $48.13 million, down 34% relative to the $73.22 million reported in 2021.
Other income amounted to $1.38 million (2021: $642,855) and finance income totalled $858,637 (2021: $549,013) for the three months ended July 31, 2022. Additionally, finance cost for the first quarter amounted to $2.04 million, 22% less than the $2.63 million reported twelve months earlier. As a result, net financial cost closed at $1.18 million (2021: $2.08 million).
Profit before taxation amounted to $48.33 million, down 33% year over year from the $71.78 million booked in 2021. There was no taxation for the period resulting in net profit of $48.33 million at the end of the first quarter; this represented a 33% contraction relative to the $71.78 million booked in 2021.
Earnings per share (EPS) for the first quarter amounted to $0.07 (2021: $0.10). The twelve months trailing EPS amounted to $0.23. The number of shares used in our calculations is 706,237,500 units. Notably, LUMBER’s stock price closed the trading period on September 13, 2022 at a price of $2.88 with a corresponding P/E of 12.68 times.
Management noted that, “During the First Quarter, our customer base reacted to uncertain economic conditions, including high interest rates and a spike in commodity prices for certain key hardware items. This led to some softening in sales and some compression in gross margins (20% in the First Quarter, relative to 24% in the first quarter of the prior year).”
Balance Sheet at a glance:
As at July 31, 2022, the Company reported total assets of $649.42 million, an increase of 14% from the $569.13 million as at July 31, 2021. This mainly constituted to ‘Property, Plant and Equipment’ which closed at $178.20 million relative to the $20.27 million booked in 2021.
Shareholders’ Equity as at July 31, 2022, was $527.08 million relative to $394.89 million booked a year prior. This resulted in a book value per share of $0.746 (2021: $0.559).
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