PTL reports 4% increase in first quarter net profit

October 16, 2020

Paramount Trading (Jamaica) Limited, for the three months ended August 31, 2020, recorded a marginal increase of 0.4% in total revenues to $362.01 million from $360.57 million reported in 2019.

Direct expenses closed the period at $245.67 million, a 3% decrease relative to the $254.12 million booked a year ago.  Gross profit increased by approximately 9% to $116.33 million (2019: $106.45 million).

Other operating income amounted $5.05 million for the quarter, a reduction of $4.95 million compared to $10 million booked for the previous year’s corresponding period. The Company noted, “the foreign exchange devaluation was the main driver for this negative variance.”

Administrative expenses increased 1% to $89.34 million, up from the $88.85 million recorded for 2019. Selling and distribution expenses decreased by 24% for the quarter to close at $1.73 million (2019: $2.29 million). As such, operating profit amounted to $30.32 million compared to $25.31 million for the same quarter of the prior financial year.

Interest income amounted to $109,498 down 93% when compared to the $1.48 million reported for the prior year, while finance costs rose 30% to total $13.08 million (2019: $10.08 million). Management noted that the increase in finance cost, “was mainly due to the interest cost on additional loans.”

Pre-tax profit for the quarter totalled $17.35 million, 4% more than the $16.71 million reported in prior corresponding quarter. Taxes were charged for the quarter in the amount of $2.17 million relative to $2.09 million in 2019. As such, Net profit totalled $15.18 million (2019: $14.62 million), a rise of 4%.

Earnings per share for the three months totalled $0.010 (2019: $0.009). The trailing twelve months earnings per share is $0.035. The number of shares used in our calculations is 1,542,467,080 units. PTL stock price closed the trading period at a price of $1.43 on October 15, 2020.

PTL mentioned that, “the Company has responded and will continue to react to the challenges of the COVID-19 epidemic in a proactive and responsible manner. We have structured our operational framework in a manner to prioritize the safety of our staff members, customers and other stakeholders. We continue to pivot our operation to take advantage of any opportunity arising as a result of the pandemic.”

Balance Sheet Highlights:

As at August 31, 2020, the company’s assets totalled $1.72 billion, $288.73 million more than the $1.43 billion quoted a year ago. The main contributor to this growth was the increase in ‘Property, Plant & Equipment’ which closed at $601.70 million relative to $349.76 million a year ago. ‘Inventories’ and ‘Right of Use Assets’ also contributed, increasing to $534.91 million (2019: $452.42 million) and $80.96 million (2019: nil), respectively.

Shareholder’s equity as at August 31, 2020 stood at $809.57 million (2019: $755.99 million) resulting in a book value per share of $0.52 (2019: $0.49).


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