August 05, 2022
Seprod Limited (SEP), for the six months ended June 30, 2022, revenue totalled $27.81 billion compared to the $19.83 billion recorded for the same period of the prior financial year; this represents a 40% increase year over year. Revenue for the quarter totalled $16 billion a 56% increase relative to $10.25 billion the prior year. SEP highlighted that, “The revenue growth was driven by the contribution of the Bryden Group for the month of June 2022, robust export growth, improved product mix, improved production of fresh milk at the dairy farms, launch of new snack line and price increases. The percentage growth in net profit is less than that of the revenue growth as the company continues to absorb some of the cost increases, rather than passing through the full extent of these cost increases to consumers. ”
Cost of Sales rose 44% from $14.39 billion in 2021 to $20.78 billion for the six months ended June 30, 2022. Consequently, gross profit increased 29% to close at $7.03 billion (2021: $5.44 billion), while the second quarter gross profit amounted to $4.09 billion (2021: $2.76 billion).
However, other operating income for the period totalled $518.69 million relative to $178.26 million in 2021, a 191% increase year over year while other operating expenses increased by 30% to close the six months period at $4.72 billion (2021: $3.62 billion).
Consequently, operating profit rose by 41% to $2.83 billion (2021: $2.00 billion) for the six months ended June 2022. While for the quarter, operating profit grew by 74% to $1.83 billion (2021: $1.06 billion).
Finance costs totalled $819.86 million (2021: $501.02 million), a 64% increase when compared to the same period last year. The company reported share of results of Joint Venture amounting to $55.26 million relative to $32.23 million reported in 2021.
Pre-tax profits climbed by 35% to $2.07 billion in comparison to profit of $1.53 billion booked in the same period last year. However, for the quarter, pre-tax profit amounted to $1.33 billion relative to $839.66 million booked in 2021.
Taxation of $433.37 million was reported for the six months period relative to $286.52 million booked in 2021. Consequently, SEP, for the period under review, booked net profit from continuing operation of $1.63 billion (2021: $1.24 billion) and net loss from discontinued operations closed at $52.61 million (2021: $37.60 million). As a result, overall net profit was $1.58 billion (2021: $1.21 billion) for the period under review, while for the quarter, net profit closed at $984.37 million (2021: $661.02 million).
The comprehensive income for the six months amounted to $1.46 billion (2021: $1.29 billion.) For the second quarter, comprehensive income amounted to $842.69 million (2021: $683.58 million).
Earnings per share for the six months ended June 30, 2022 amounted to $2.02 relative to $1.75 for the corresponding period in 2021. The EPS for the quarter was reported at $1.20 relative to $0.93 reported in 2021. The twelve months trailing EPS is $2.98. The number of shares used in our calculations is 733,546,855. SEP closed the trading period on August 05, 2022 at $68.09 with a corresponding P/E of 22.85 times.
Management noted that, “The Seprod Group acquired a majority stake in A.S. Bryden & Sons Holdings Limited (the Bryden Group) in June 2022 in a well-documented transaction. The results for the Seprod Group for Q2 and Q2 year-to-date, therefore, include the performance of the Bryden Group for the month of June 2022, which is a significant contributor to the uplift in the results relative to the comparative periods of the prior year.”
Balance Sheet at a Glance:
As at June 30, 2022, the company’s total assets increased to $78.07 billion from $39.13 billion a year ago. The upward movement was due to an increase in ‘Property, Plant & Equipment’ and ‘Inventories’ which closed the period at $20.12 billion (2021: $7.15 billion) and $17.85 billion (2021: $7.84 billion), respectively.
Shareholders’ equity for the period was $27.51 billion relative to $17.96 billion last year. As such, resulting in a book value per share of $37.50 relative to $24.48 last year.
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