MTL reports a 57% decline in nine months net profit

March 26, 2018. 

Margaritaville (Turks) Ltd (MTL) for the nine months ended February 28, 2018 reported Total Revenue of  US$4.06 million, a 12% decline relative to the US$4.64 recorded for the prior financial year. The company noted, “The revenue number is significant because the location suffered from two Category 5 hurricanes, back to back, during early September 2017.The location and the entire island were severely damaged and had to be closed for a portion of September and all of October.” Total revenue for the quarter amounted to US$1.81 million, a marginal decline of 1% compared with the US$1.82 million reported for the comparable quarter in 2017.

Cost of sales for the period amounted to US$1.08 million, a 12% contraction relative to US$1.23 million recorded the previous year. This resulted in gross profit for the period of US$2.98 million, 12% lower than last year’s US$3.41 million reported in 2017. The Company noted, “the management team has done a great job in containing the exposure to product loss from spoilage as a result of the loss of Electricity associated with the hurricanes.”

Total expenses for the period declined by 8% year over year, moving from US$3.07 million for the nine month ended February 2017 to US$2.83 million.  Of this,

  • Administrative and general expenses closed at US$2.45 million, an 8% decline compared to US$2.67 million in 2017.
  • Depreciation totalled US$144,991, a fall of 20% relative to the US$181,234 booked last year.
  • Promotional Expenses amounted to US$57,023 (2017: US$28,353).
  • Management Fee amounted to $187,500, a flat amounted for the past 3 years.

Consequently, operating profit year over year reflected a 57% decline to US$147,409, relative to the $339,122 booked for the comparable period in 2017.  Operating loss for the quarter amounted to US$86,336 in contrast to a profit of US$161,527 in 2017.

Finance cost of US$175 was charged for the nine months, compared to the US$525 recorded last year. As such, net profit declined 57% to US$147,234 versus US$339,122 booked for the same period of in 2017. Net Loss for the quarter amounted to US$86,336 , when compared with a net profit of US$161,527 recorded for the comparable quarter in 2017.

Loss per share for the nine months ended February 28, 2018 totaled US$0.22 cents versus an earnings per share of  US$0.50 cents for the corresponding period of 2017. Loss per share for the quarter amounted to US$0.13 cents relative to a earning per share of $0.24 cents in 2017. The trailing twelve months earnings per share amounted to US$0.46 cents. The number of shares used in our calculations 67,500,000 units. Notably, MTL’s stock price closed the trading period on March 26, 2018 at a price of US$0.25 cents

Balance Sheet at a glance:

Total Assets as at February 28,2018  amounted to US$5.56 million. Management noted, “The Company has expended US$335,756 on Fixed Assets acquisition during the nine month YTD, The larger share of this relates to replacement of assets associated with hurricane damages”

Shareholders’ Equity totalled US$4.12 million. As such, book value per share amounted to US$0.06 for FY2017.


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.