MDS reports 5% decrease in nine months Net Profit

Date: February 13, 2018

Medical Disposables & Supplies Limited, for the nine months ended December 31, 2017, reported revenue amounted to $1.49 billion, an increase of 18% when compared with the $1.26 billion booked last year. Revenue for the quarter totaled $521.10 million up 21% year over year (2016: $431.93 million). MDS stated that this performance was due to “increased sales in all divisions of the business operations.”

Cost of sales rose by 23% to total $399.88 million during the quarter relative to the $325.82 million reported for the same period last year. For the nine months period, cost of sales increased by 21% to $1.16 billion (2016: $954.96 million). Consequently, gross profit increased 14% or $15.11 million to a total of $121.21 million in the quarter relative to the $106.11 million for the corresponding period in 2016. There was a 9% increase in gross profit for the nine months period as compared to prior year. The company highlighted that “this improvement in the gross profit was driven by increased sales as a result of new business lines.”

Total operating cost closed the period at $247.64 million, up 17% (2016: $211.10 million).  Of this selling and promotional costs increased 29% to $98.48 million (2016: $76.37 million) Administrative expenses increased by 13% to $130.13 million from $115.08 million last year. This was as a result of “increases in staff-related expenses, professional fees, marketing expenses, transportation and delivery, insurance, utilities and security expenses”.

Gain on foreign exchange was reported at $4.68 million compared a loss of $2.12 million in 2016. Finance Cost decreased by $171,000 to total $26.44 million. (2016: $26.61 million) .

As a result, MDS reported profit before tax of $63.52 million, a 5% decrease relative to the $66.86 million reported in 2016.

Consequently, net profit for the period amounted to $63.46 million relative to $66.80 million in 2016, a 5% decline year over year, after a tax charge of $60,000 for the 2017 period.  Net profit for the quarter amounted to $31.89 million (2016: $29.23 million).

Earnings per share for the period amounted $0.24 (2016: $0.25). EPS for the quarter amounted to $0.12 relative to $0.11 in 2016. The trailing-twelve-month EPS amounted to $0.37. The number of shares used in the calculations is 263,157,895.

MDS closed February 13, 2018, at $5.00.

Balance Sheet at a glance:

 As at December 2017, total assets amounted to $1.36 billion, 15% more than $1.12 billion the year prior. The company noted that, “this was as a result of increased inventories and receivables balances generated from the introduction of new business lines which resulted in the overall increase in sales revenue.”

Shareholders’ Equity totaled $627 million (2016: $530.34 million) resulting in a book value per share of $2.38 (2016: $2.02).

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