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).



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