April 14, 2021
Paramount Trading (Jamaica) Limited recorded a 3% decline in total revenues to $1.02 billion from $1.15 billion reported in 2020. For the quarter, revenues declined 9% to close at $347.24 million (2020: $381.51 million). PTL stated that “the economic contraction continued to plague our income. However, we were able to extract a higher gross profit percentage from the reduced sales levels.”
Direct expenses closed the period at $691.79 million, a decline of 14% relative to the $807.30 million booked a year ago. As a result, gross profit fell by approximately 5% to $324.07 million (2020: $342.42 million). For the quarter, gross profit closed at $107.71 million relative to $111.30 million reported in the prior corresponding quarter.
Other operating income amounted to $18.78 million for the nine months period compared to $39.62 million booked for the previous year’s corresponding period. For the third quarter, other operating income closed at $6.03 million (2020: $16.72 million).
Administrative expenses declined by 6% to $266.77 million, down from the $284.03 million recorded for 2020. Selling and distribution expenses fell by 41% for the nine months to close at $8.34 million (2020: $14.06 million). The Company mentioned that, “the cost restructuring exercise the company undertook early in the pandemic is bearing some fruits in the expense side of the business” As such, operating profit amounted to $67.74 million compared to $83.95 million for the same period for the prior comparable financial year. For the quarter, operating profit fell 2% to close at $20.67 million (2020: $21.08 million).
Interest income amounted to $1.24 million (2020: $2.30 million), while finance cost increased to total $37.28 million (2020: $30.49 million). For the quarter, interest income and finance cost closed at $54,878 (2020: $335,933) and $11.53 million (2020: $10.86 million), respectively.
Pre-tax profit for the period totaled $31.71 million, 43% less than the $55.75 million reported in the prior corresponding period. Taxes were charged for the period amounting to $3.96 million relative to $6.97 million in 2020. As such, net profit closed at $27.74 million, a 43% decline (2020: $48.78 million). For the quarter, net profit amounted to $8.05 million (2020: $9.24 million), a 13% decline.
Earnings per share for the nine months amounted to $0.018 (2020: $0.032). For the quarter, earnings per share closed at $0.005 (2020: $0.006). The trailing twelve months earnings per share equaled $0.0207. 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 $1.40 on April 14, 2021, with a corresponding P/E ratio of 67.53 times.
PTL highlighted that “The period ending February 28, 2021, was very challenging as the company continued to battle the negative impact of the Covid-19 pandemic. Our lubricant division was directly impacted by the general decrease in the transportation sector, while our food-grade division suffered from the closure of educational institutions and the lockdown of the entertainment industry.”
Balance Sheet Highlights:
As at February 28, 2021, the Company’s total assets totaled $1.61 billion, 7% less than the $1.73 billion quoted a year ago. The main contributors to this were the decline in ‘Inventories’ and ‘Receivables’ which closed at $440.03 million (2020: $583.16 million) and $293.15 million (2020: $357.93 million), respectively. This was tempered by an increase in ‘Right of use assets’ which closed at $76.34 million (2020: nil).
Shareholders’ Equity as at February 2021 stood at $760.43 million (2020: $790.15 million), resulting in a book value per share of $0.49 (2020: $0.51).
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