November 16, 2020
Tropical Battery Company Ltd (TROPICAL)
Financial Statements for the Year Ended September 30, 2020:
Tropical Battery Company Limited (TROPICAL) for the year ended September 30, 2020 recorded revenue in the amount of $1.87 billion (2019: $1.74 billion), a 7% increase when compared to 2019. Revenue for the quarter increased by 3%, moving from $492.57 million in 2019 to $505.54 million for the period under review.
Cost of sales amounted to $1.28 billion, which represents a 5% increase in comparison to the $1.22 billion booked in the previous year. Consequently, gross profit amounted to $584.60 million, 11% up from $525.85 million reported the prior year. Gross profit for the quarter ended at $160.58 million (2019: $147.20 million).
Administrative, marketing and selling expenses rose by 10% to close at $455.89 million versus $412.72 million reported in 2019. Operating profit for the period totalled $128.71 million (2019: $114.27 million), while operating profit for the quarter increased by 4% to end at $37.19 million (2019: $35.86 million). Other operating income for the year amounted to $16.83 million, this represents an 85% increase relative to the $9.09 million booked the previous year.
Finance costs increase year over year by 97% to a total of $38.06 million (2019: $19.29 million). In addition, Depreciation closed at $21.88 million (2019: $23.87 million).
Foreign exchange gain for the period totalled $1.52 million relative to $6.38 million in 2019, a 76% decrease year on year. For the quarter, foreign exchange loss amounted to $8.44 million (2019: loss of $2.80 million).
As such, profit before tax closed at $87.12 million for 2020, a marginal increase of 1% over the $86.58 million booked last year. Profit before tax for the quarter increased by 32%, moving from $18.96 million in 2019 to $24.99 million. Taxes of $14.38 million was reported compared to a tax charge of $23.69 million in 2019. Net Profit amounted to $72.74 million compared to $62.90 million in 2019, a 16% increase. Net profit for the quarter totalled $26.93 million, representing a 107% increase relative to the $13.04 million reported in the corresponding period for 2019.
Earnings per share (EPS) for the year amounted to $0.06 versus an EPS of $0.05 for 2019. For the quarter, EPS amounted to $0.02 (2019: $0.01). The number of shares used in our calculations amounted to 1,300,000,000 units. TROPICAL closed the trading period on November 13, 2020 at $1.20.
Management indicated that, “The work from home and social distancing procedures implemented to slow the spread of COVID-19, could have had a more severe impact on Tropical Battery’s distribution. However, due to recent innovations and upgrades to our distribution strategy in recent years, the company was able to minimize the effect of less consumer traffic.”
Balance Sheet Highlights:
As at September 30, 2020, total assets amounted to $1.32 billion, compared to its value of $1.35 billion a year ago, a 3% decrease year on year. This decrease was attributed to a 44% decline in ‘Due from related companies’ which amounted to $154.05 million relative to $273.03 million in 2019. The downward movement was tempered by a 133% increase in ‘Property, plant & equipment’ which totalled $162.87 million (2019: $70.03 million).
Shareholder’s Equity as at September 30, 2020 totalled $776.13 million (2019: $547.08 million) resulting in a book value per share of $0.60 (2019: $0.42).
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