Date: February 17, 2020
Seprod Limited (SEP) posted revenue totalling $34.35 billion compared to $22.50 billion recorded for the same period of the prior financial year, representing a 53% increase year over year. The Company stated, “This was driven primarily by the acquisition of the Facey Consumer Division in Q4 2018 and by an increase in the export business.” For the quarter, revenue climbed 22% closing at $9.55 billion relative to the $7.80 billion reported the prior year’s corresponding quarter.
Cost of Sales increased by 40% from $15.56 billion to $21.75 billion, resulting in gross profit increasing by 82% to close at $12.60 billion (2018: $6.94 billion). For the quarter, gross profit closed the period at $3.58 billion relative to $2.03 billion in the previous comparable period.
Finance and other operating income totalled $194.95 million compared to $837.66 million in 2018, a decline of 77% year over year. For the quarter, finance and other operating income declined by 88% to close at $19.93 million (2018: $161 million).
Other operating expenses increased by 87% to close the year end period of 2019 at $9.79 billion (2018: $5.23 billion).
As such, Operating profit grew 18%, moving from $2.54 billion to $3.01 billion to close the year end period of 2019. For the quarter, operating profit totalled $797.40 million (2018: $555.75 million).
Finance costs amounted to $1.37 billion (2018: $737.98 million), an increase of 86% year over year. For the quarter, finance cost closed at $508.04 million compared to $304 million in the prior comparative quarter.
Profit before taxation increased to $1.73 billion in 2019, a 7% decrease on $1.86 billion reported a year prior. Profit before taxation for the fourth quarter amounted to $344.15 million (2018: $292.96 million).
Seprod reported net profit from continuing operations of $1.99 billion (2018: $1.5 billion), an increase of 34% year over year. Net profit attributable to shareholders amounted to $1.27 billion, 8% more than the $1.18 billion reported in 2018. For the quarter, net profit attributable to shareholders closed at $803 million (2018: $133.25 million). Seprod noted that, “The increase in profits from continuing operations was due in large part to efficiencies gained from internal reorganizations of the ingredients and the distribution businesses, and from the consolidation of the dairy business.”
Consequently, earnings per share (EPS) for the year ended December 31, 2019 amounted to $1.74 relative to $1.61 for the corresponding period in 2018. Earnings per share for the quarter was amounted to $1.09 (2018: $0.18). SEP last traded on February 17, 2020 at $46.23.
The Company highlighted that “During 2019, Management executed on its previously communicated decision to close the sugar factory and, in so doing, curtail the ten (10) years of operational losses from sugar manufacturing. This move will positively impact the Group’s return on equity and its cashflows in the future. The losses from this discontinued operation (inclusive of redundancy payments and estimated impairment losses) amounted to J$814 million.”
Balance sheet at a Glance:
As at December 31, 2019, the Company’s Total Assets increased by 1% to $35.60 billion from $35.30 billion a year ago. Non-current assets closed at $21.07 billion (2018: $20.69 billion) while current assets amounted to $14.53 billion (2018: $14.61 billion).
Shareholders’ Equity as at December 31, 2019 amounted to $15.21 billion relative to $15.74 billion in 2018, indicating a 3% decrease. This translated into a book value per share of $20.73 (2018: $21.46).
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