February 15, 2021
Mailpac Group Limited (MAILPAC)’s revenue amounted to $1.72 billion for the twelve months ended December 31, 2020, 42% greater than $1.21 billion booked for 2019 year end. While, for the quarter, revenues closed at $512.14 million (2019: $361.73 million).
Cost of sales totalled $903.30 million (2019: $574.87 million). As a result, gross profit amounted to $816.23 million (2019: $638.29 million), 28% higher than the previous comparable period. Gross profit for the third quarter amounted to $231.89 million (2019: $196.46 million). The Company noted, “Due to the significant spike in package volume, gross profit was adversely impacted by extraordinary spending on charter flights and other freight solutions to offset the lack of capacity at traditional airlift capacity are mitigated in the future.”
Operating expenses for the period under review closed at $338.53 million (2019: $340.51 million), in which:
Selling and promotion totaled $51.41 million (2019: $43.55 million).
Administrative and general expenses closed at $287.13 million (2019: $296.97 million).
Operating expense for the quarter closed at $110.18 million, versus $87.40 million booked twelves earlier. MailPac noted, “the Company had significantly expand its operating infrastructure to support the new volume levels.”
As such, operating profit for the twelve months period summed to $477.70 million, 60% increase from December 31, 2019 operating profit of $297.78 million. While for the quarter, operating profit closed at $121.71 million (2019: $109.06 million).
Mailpac recorded other income of $20.07 million (2019: $18.34 million) and finance cost of $54.71 million (2019: $16.21 million) for the twelve months ended December 31, 2020.
Consequently, Mailpac booked profit before taxation of $443.05 million (2019: $299.91 million), 48% increase from the prior corresponding period. Profit before taxation for the fourth quarter closed at $104.17 million (2019: $96.78 million).
Taxes incurred for the period under review totalled $338,199 (2019: $10.49 million), as such net profit closed the FY2020 at $442.72 million (2019: $289.42 million). While for the quarter, net profit totalled $103.84 million (2019: $86.28 million).
Consequently, earnings per share (EPS) amounted to $0.18 (2019: EPS of 0.12). For the quarter, EPS closed at $0.04 (2019: $0.04). The number of shares used in this calculation was 2,500,000,000 shares. MAILPAC traded on February 12, 2021 at $3.94 with a corresponding P/E of 22.25 times.
MAILPAC noted, “The company exceeded the 2020 projections outlined in its November 2019 IPO Prospectus by employing a number of strategies to provide better access to online shopping for Jamaicans whose travel and movement were curtailed due to the Covid-19 pandemic.”
Balance Sheet at a Glance:
As at December 31, 2020, total assets closed at $651.34 million, up from $444.84 million booked in December 2019. Notably, the increase in asset base is due to cash and cash equivalents amounting $291.85 million, 80% up from $106.52 million recorded in 2019.
Shareholder’s equity totaled $571.36 million (2019: $353.64 million), resulting in a book value of $0.23 (2019: $0.14).
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. 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.