July 15, 2021
(With the comparative period nine months ended April 30, 2020)
The Lumber Depot Limited (LUMBER), for the year ended April 30, 2021, reported revenue of $1.43 billion, an increase of 55% year over year (2020: $921.45 million). Revenue for the quarter totalled $410.39 million (2020: $293.05 million). Management noted, “During the period under review, a major area of focus for us was to maintain consistent inventory levels in all of the key hardware supplies – including lumber, steel and cement products – regardless of the factors affecting production and transportation of these items. We have proactively developed relationships with key suppliers of construction inputs both in Jamaica and overseas and sought to buy strategically in order to contain the impact of rapidly increasing global commodity prices and transport costs.”
Cost of sales for the period amounted to $1.14 billion. Consequently, gross profit for the period closed at $293.45 million.
Moreover, the Company reported administrative and other expenses of $154.22 million, 42% up from the $108.29 million reported twelve months prior. Impairment gains on trade receivables amounted to $3.17 million relative to the Impairment loss of $20.28 million reported for the nine months ended April 2020.
As such, operating profit for the period amounted to $144.36 million, up 303% relative to the $35.84 million reported in 2020. For the quarter, operating profit totalled $54.68 million compared to an operating loss of $12.46 million in 2020.
Other income for the year ended April 30, 2021, amounted to $3.22 million (2020: $2.32 million).
Net finance costs totalled $2.57 million relative to the $6.11 million reported for the nine months ended April 2020. Of this, finance income amounted to $6.53 million (2020: $993,398). However, finance costs closed at $9.10 million (2020: $7.10 million).
Profit before taxation ended at $145.02 million, up 352% year over year from the $32.05 million booked in 2020. Taxation charge for the period was $25,254 (2020: $9.88 million), resulting in a net profit of $145 million (2020: $22.18 million) for the year ended April 30, 2021. For the quarter, net profit was $64.15 million relative to a net loss of $15.30 million booked the corresponding quarter last year.
Management noted that “Lumber Depot is clearly generating returns from the growth in Jamaica’s construction sector and to some extent from its improved tax status arising from its listing on the Junior Market of the JSE. Over the medium term, we expect Jamaica’s construction and home improvement industry to continue to benefit from increased liquidity in the financial services sector as well as improved overall competitiveness of the Jamaican economy.”
Earnings per share (EPS) amounted to $0.21 (2020: $0.03). For the quarter, EPS amounted to $0.09 (2020 LPS: $0.02). The number of shares used in our calculations is 706,237,500 units. Notably, LUMBER’s stock price closed the trading period on July 14, 2021 at a price of $3.37 with a corresponding P/E ratio of 16.42 times.
Balance Sheet at a glance:
As at April 30, 2021, the Company reported total assets of $526.63 million (2020: $374.01 million). The main contributors were ‘Cash and Cash Equivalents’ and ‘Inventories’ which closed at $142.66 million (2020: $29.08 million) and $131.60 million (2020: $104.69 million), respectively.
Shareholders’ Equity as at April 30, 2021 was $323.11 million (2020: $192.24 million). This resulted in a book value per share of $0.46 relative to the $0.27 reported in the corresponding period last year. Management noted, “During the course of the year, Lumber Depot, grew shareholders equity by 68% and quintupled its cash position.”
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