MDS reports three months net profit of $25.48 million

August 11, 2021

Medical Disposables & Supplies Limited (MDS) for the three months ended June 30, 2021, reported revenue of $682.58 million, an increase of 34% compared to the $510.08 million booked in 2020. According to Management, “This increase in sales is the result of increased consumer demand for pharmaceutical and medical disposable items.”

Cost of Sales totaled $506.10 million relative to $397.24 million in 2020, representing a 27% increase. Gross Profit rose by 56% to total $176.49 million compared to $112.84 million in 2020. According to MDS, “This was mostly attributable to the increase in sales of pharmaceutical and medical disposable products.”

Total Operating Cost rose 13% to close at $128.36 million (2020: $113.42 million), MDS noted that “This movement was due to the costs associated with boosting the sales effort, particularly in the Consumer Division.” Of this:

Selling and Promotional costs rose 4% to $58.64 million relative to $56.13 million in 2020.

Administrative Expenses went up by 25% to close the three months period at $62.61 million (2020: $50.25 million).

Depreciation rose by 1% to close the quarter at $7.11 million (2020: $7.03 million).

As a result, operating profit closed the first quarter at $48.13 million relative to an operating loss of $583,360 in 2020. MDS reported loss on foreign exchange of $3.67 million versus a gain of $4.04 million twelve months earlier.

Finance Cost for the three months amounted to $17.16 million relative to the $12.01 million reported in 2020, a 43% increase year over year.

Pre-tax profit totalled $29.12 million, up from a loss of $7.07 million booked for the corresponding quarter of 2020.  Net profit for the quarter amounted to $25.48 million after taxation of $3.64 million (2020: nil) relative to a net loss of $7.07 million booked for the first three months of 2020.

Earnings per share for the first quarter amounted $0.10 (2020: LPS $0.03). The trailing earnings per share amounted to $0.39. The number of shares used in the calculation was 263,157,895. MDS stock price closed the trading period on August 10, 2021, at $4.50 with a corresponding P/E ratio of 11.59 times.

Balance Sheet Highlights:

As at June 30, 2021, Total Assets rose by 25% amounting to $2.47 billion (2020: $1.97 billion). According to MDS, “ This was due to the acquisition of a 60% stake in subsidiary company, Cornwall Enterprises Limited (CEL). This resulted in assets totalling $453.5M being consolidated into the Group.”

Shareholders’ equity totalled $920.24 million (2020: $826.69 million), resulting in a book value per share of $3.50 (2020: $3.14).

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