MTL reports 2% decline in first quarter net profit

Date: October 19, 2018

Margaritaville (Turks) Limited (MTL), for the three months ended August 31, 2019 reported Revenues which decreased by 2% for the period to US$1.82 million (2017: US$1.86 million). The company commented that “Revenue per passenger will vary marginally from one period to another, even where aggregate passenger numbers are similar, due to variations in dwell time, variations in time of day that the ship called and differing weather pattern on the ship call days.”

Cost of sales (COS) also went down by 3% to US$471,386 (2017: US$483,803) which resulted in COS margin of 26% the same as the last two years. The company stated that “none of the expenditure categories recorded unusual movements over the comparable periods. Expenditure on fixed assets during the quarter was US$98,794. Expenditure continued into the quarter on the refurbishing necessitated as a result of damage associated with Hurricanes Irma and Marie in 2017.”

As such, gross profit fell for the three-month period by 2%, from US$1.38 million in Q1 2017 to US$1.35 million in Q1 2018.

Total expenses was reduced by 2% for the period in review to US$1.06 million in 2018, up from US$1.08 million in 2017. The decrease was associated with a 3% drop in administrative expenses to US$924,775 from US$948,665. Promotional Expenses also went down by 11% to US$$14,580 (2017: US$16,408) while Depreciation and amortization slightly moved up by 2% to $US54,922 (2017: US$53,956).

Consequently, operating profit dipped by 2% to US$290,991 (2017: US$296,412). Total comprehensive income for the quarter amounted to US$290,816 relative to US$296,412 million the previous year, a 2% decline.

The twelve-month earnings-per-share was US$0.0157, while for Q1 2018, it amounted to US$ 0.0043 compared to US$0.0044 of the corresponding period of last year. The number of shares used in our calculations was 67,500,000. MTL last traded on October 18, 2018 at $0.25.

MTL further noted, “We are deep into the second quarter when preparation begins in order to be ready for the busier winter season ahead. There are a number of open vacancies that will require filling to meet the winter season. We continue to make representation for a change in the policy on expatriate workers. A dividend of US$1M has also been declares and will be paid out in November 2018.

Balance Sheet Highlights:

The company, as at August 31, 2018, recorded total assets of US$6.20 million, an increase of 34% when compared to US$4.62 million for the Q1 2017. MTL added, “Trade and Receivable balances were regularized to pre year end levels; a one-time Insurance Receivable was settled. Related companies balances are being given attention and will be addressed in the second quarter.”

Total Stockholders’ equity as at August 31, 2018 closed at US$5.08 million, a 26% increase from US$4.02 million for the corresponding period last year. This resulted in a book value of US$ 0.0753.

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