February 13, 2023
For the nine months ended December 31 2022, Radio Jamaica Limited’s (RJR) revenues fell by 3% from $4.31 billion in 2021 to $4.19 billion for the period under review. For the quarter, revenues closed at $1.450 billion (2021: $1.453 billion), representing a 0.21% decline year over year RJR noted that, “the decrease in the Group’s revenues were driven mainly by decreases in the Audio/ Visual division of $18 (2.9%) and in the Audio division of $4 million (1.7%) offset by an increase of $19 million (3.1%) in the Print and Online division. The Group continues to experience softness in the overall advertising market as business continue to be impacted by the aforementioned local and global economic challenges.”
Direct expenses grew 10% to $1.84 billion, versus the prior year’s figure of $1.67 billion. For the quarter, direct expenses rose 14% to close at $624.29 million (2021:$546.14 million).
As such, gross profit for the nine months amounted to $2.35 billion relative to $2.64 billion for the corresponding period in 2021. For the quarter, gross profit closed at $826.24 million (2021: $907.42 million).
Total expenses experienced a 6% increase for the period under review, from $2.41 billion in 2021 to $2.54 billion in December 2022. As for the quarter, total expenses closed at $888.93 million (2021: $818.16 million).
There was a 3% increase in selling expenses to $811.78 million (2021: $790.07 million). RJR noted that, “the increase was driven by the distribution related costs.”
Other operating expenses rose by 16% to $692.14 million relative to $594.46 million in 2021. The upward trend was attributable to increased costs for the maintenance of transmitters and other equipment.
RJR reported an improvement in other income which rose to $109.73 million in 2022 compared to the 2021’s figure of $116.79 million. While for the quarter, other income plunged to $13.44 million (2021: $67.81 million).
Operating loss amounted to $83.93 million for the period in review, compared to a profit of $351.90 million reported in 2021. As for the quarter, operating loss of $49.24 million was recorded versus operating income of $157.07 million was booked for the prior year’s comparable period.
Finance costs remained stable at $38.04 million versus $32.42 million in the prior year. Finance cost for the quarter rose 28% to $12.61 million relative to $9.89 million booked for the three months ended December 2021.
RJR reported a Bargain purchase gain of $433.83 million which represented the amalgamation of Radio Jamaica Limited (RJL) and 1834 Investments.
RJR reported profit before tax of $311.86 million versus $319.47 million reported December 31, 2021. As for the quarter, profit before tax grew to $371.98 million versus $147.18 million a year earlier.
After tax credit of $17.26 million (2021: tax charge of $73.89 million), RJR recorded a net profit of $329.12 million relative to $245.58 million for the prior year’s corresponding period. For the quarter, net profit totaled $381.38 million compared to $108.11 million in the same period last year.
Net profit attributable to shareholders amounted to $325.51 million for the period under review versus $251.83 million booked in the same period last year. For the quarter, net profit attributable to shareholder closed at $381.53 million versus $115.77 million reported twelve months earlier.
The earnings per share (EPS) for the nine-month period amounted to $0.13 versus $0.10 in 2021. For the quarter, an EPS of $0.16 was recorded (2021: EPS of $0.05). The twelve months trailing earnings per share is $0.17. The number of shares used in this calculation was 2,422,487,654 units. RJR stock last traded on February 10, 2022 at $1.91 with a corresponding P/E ratio of 11.14 times.
Balance Sheet Highlights:
RJR as at December 31, 2021, recorded total assets of $7.04 billion, a 38 % increase when compared to $5.11 billion for the previous corresponding period. The increase was mainly attributable to an increase in ‘Fixed Assets’ which closed at $3.23 billion (2020: $1.73 billion). ‘Investments accounted for using the equity’ also contributed to the overall increase in the asset base with a 214% upward movement to $437.21 million relative to $139.25 million as of December 31, 2021.
Total Shareholders’ Equity closed at $4.62 billion, up 69% from $2.73 billion in 2021. This resulted in a book value of $11.91 (2021: $1.13).
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.
