November 17, 2020
For the nine months ended September 30, 2020:-
Consolidated Bakeries (Jamaica) Limited (PURITY), for the nine months ended September 30, 2020 recorded a 2% decline in revenue to $770 million from $786.66 million reported for the corresponding period in 2019. For the third quarter, the company recorded a revenue of $226.38 million (2019: $237.99 million), representing a 5% contraction.
Cost of sales for the period fell by 5% to close at $465.98 million (2019: $488.80 million), leading to a gross profit of $304.02 million (2019: $297.86 million). Within the quarter, PURITY recorded cost of sales of $134.44 million, down 10% relative to $149.52 million booked at the end of the third quarter for 2019. As such, third quarter’s gross profit totalled $91.94 million, up 4% year over year (2019: $88.47 million).
The Company reported total expenses of $287.79 million, a 2% rise when compared to the $282.97 million reported in 2019. Of this, administrative expenses amounted to $159.26 million, up 9% relative to $146.09 million reported in 2019. Selling Expenses went down by 8% to close at $104.94 million (2019: $113.56 million). Total Expenses for the third quarter amounted to $92.98 million relative to the $93.12 million booked in 2019.
This resulted in an operating profit of $16.23 million for the nine-months period, compared to an operating profit of $14.89 million documented for the comparable period in 2019. For the third quarter, Operating Loss amounted to $1.05 million relative to an Operating Loss of $4.65 million booked in 2019.
Finance Cost grew by 27% to close at $10.40 million versus $8.20 million booked twelve months earlier. Interest and other income closed the period at $1.03 million, 72% below the $3.66 million recorded for the nine months ended September 30, 2019.
Consequently, PURITY recorded Pre-tax Profit of $6.86 million compared to a Pre-tax profit of $10.34 million in 2019. Pre-tax loss for the quarter closed at $3.02 million in 2020 compared to a Pre-tax loss of $5.24 million in the previous corresponding quarter.
The Company incurred taxes of $858,036 and deferred taxes of $762,203 for the period under review, resulting in a Net Profit of $5.24 million versus a profit of $8.41 million last year. For the third quarter, the Company booked a net loss of $2.64 million in contrast to a loss of $5.22 million for the corresponding quarter in 2019.
As a result, earnings per share (EPS) for the nine-months amounted to $0.02 compared to an earnings-per-share (EPS) of $0.04 reported in 2019 For the quarter, the loss-per-share totalled $0.012 relative to a LPS of $0.024 in 2019. The twelve-months trailing LPS is $0.07. The number of shares used in our calculations is 222,709,171 units. PURITY stock last traded on November 16, 2020 at $1.35.
Balance Sheet at a glance:
PURITY, as at September 30, 2020, recorded Total Assets of $999.27 million, a decrease of 1% year over year. The decrease was attributed mainly to a 52% contraction in ‘Investment’ which closed at $23.30 million (2019: $48.83 million). Notably ‘Cash and Cash Equivalents’ and ‘Property Plants and Equipment’ recorded growth amounting to $72.35 million (2019: $66.57 million) and $765.88 million (2019: $743.40 million), respectively.
The company closed the period with Shareholders’ Equity in the amount of $713.16 million (2019: $735.49 million). As a result, the company now has a book value per share of $3.20 (2019: $3.30).
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.