PURITY Reports $19.76 Million in Six Months Net Profit

Date: August 20, 2018

Consolidated Bakeries (Jamaica) Limited (PURITY), for the six months ended June 30, 2018, recorded a 10% increase in revenue to $492.54 million from $447.60 million reported for the corresponding period in 2017. For the second quarter the company recorded a revenue of $221.49 million (2017: $219.69 million), representing a 1% growth.

Cost of sales for the period rose by 3% to close at $305.88 million (2017: $296.21 million), leading to a gross profit of $186.65 million (2017: $151.39 million). Within the quarter PURITY recorded cost of sales of $143.95 million, down 4% relative to $150.69 million booked at the end of the second quarter for 2017.  As such, second quarter gross profits totaled $77.55 million, up 12% year over year (2017: $69 million).

Other income decreased 29% to $1.65 million relative to $2.32 million booked for the comparable period in 2017. For the quarter, other income closed at $603,673 (2017: 1.09 million), declining by 44%.

The company reported total expenses of $158.94 million, a 0.5% decline when compared to the $159.67 million reported in 2017. Of this, administrative expenses amounted $92.02 million, up 0.4% relative to the $91.62 million reported in 2017, while, selling expense fell by 2% to close at $66.92 million (2017: $68.05 million). Total expenses for the second quarter amounted to $75.62 million, down 9% year over year from $83.54 million booked in 2017.

This resulted in an operating profit of $29.36 million for the six-month period, compared to an operating loss of $5.96 million documented for the comparable period in 2017. For the second quarter, operating profit amounted to $2.53 relative to an operating loss of $13.46 million.

Finance costs increased by 167% to close at $6.76 million versus $2.53 million twelve months earlier.

Consequently, PURITY recorded pre-tax profit of $22.60 million relative to a pre-tax loss of $8.49 million. Pre-tax loss for the quarter closed at $1.02 million compared to a pre-tax loss of $14.27 million in the previous corresponding quarter.

The Company incurred taxes of $2.83 million for the period under review, resulting in a net profit of $19.78 million relative to a loss of $8.49 million. For the second quarter, the company booked a tax credit of $127,512, resulting in a net loss of $892,586 in contrast to a loss of $14.27 million for the corresponding quarter in 2017.

As a result, earnings per share (EPS) for the six-months amounted to $0.089 compared to a loss-per-share (LPS) of $0.038 reported in 2017. For the quarter, the loss-per-share totaled $0.004 relative to a LPS of $0.064 in 2017. The twelve-months trailing LPS is $0.052 and the number of shares used in our calculations is 222,709,171 units. PURITY stock last traded on August 17, 2018 at $2.17.

Balance Sheet Highlights:

PURITY, as at June 30, 2018, recorded Total Assets of $948.23 million, an increase of 28% year over year. The increase was attributed mainly to a 45% growth in ‘Property, Plant and Equipment’ which closed at $707.62 million (2017: $488.98 million).

The company closed the period with shareholders’ equity in the amount of $736.40 million, representing an increase of 36%. The increase was due to a growth in revaluation reserves from $330.85 million to $537.34 million. The company now has a book value per share of $3.31 (2017: $2.42).

 

 

Disclaimer: 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.

2018-08-20T16:34:22+00:00