TROPICAL reports 26% increase in three months net profit

February 15, 2021

Tropical Battery Company Limited (TROPICAL) for the year ended December 31, 2020 recorded revenue in the amount of $450.99 million (2019: $498.24 million), 9% decrease when compared to 2019, “because of supplier shipment delays,” according to Management.

Cost of sales amounted to $314.70 million, which represents a 10% decrease in comparison to the $349.03 million booked in the previous year. Consequently, gross profit amounted to $136.29 million, 9% down from $149.20 million reported the prior year.

Administrative, marketing and selling expenses fell by 6% to close at $103.68 million versus $110.74 million reported in 2019. Operating profit for the period totalled $32.61 million (2019: $38.47 million). Other operating income for the period amounted to $3.02 million, this represents a 389% surge relative to the $616,935 booked the previous year.

Finance costs increase year over year by 45% to a total of $13.56 million (2019: $9.36 million). while financial income closed the period at $5.97 million (2019: nil). In addition, Depreciation closed at $9 million (2019: $6.83 million).

As such, profit before tax closed at $19.04 million for 2020, a decrease of 17% from the $22.90 million booked last year. However, net profit for the three months increased by 26%, moving from $15.09 million in 2019 to $19.04 million for the period under review. No taxes were reported for the period under review compared to a tax charge of $7.81 million in 2019.

Earnings per share (EPS) for the first quarter amounted to $0.015 versus an EPS of $0.012 for 2019. The trailing twelve months EPS was $0.026. The number of shares used in our calculations amounted to 1,300,000,000 units. TROPICAL closed the trading period on February 15, 2021 at $1.17 with a corresponding P/E of 45.69 times.

TROPICAL noted, “We are making good progress with our pipeline of potential partnerships and strategic acquisitions in Jamaica and across the Caribbean region. We will have one or two to announce later this year. Additionally, demand continues to be strong for the brands that we carry and our new Ferry retail store continues to perform above expectations.”

Balance Sheet Highlights:

As at December 31, 2020, total assets amounted to $1.58 billion. Largest contributors to the assets base are ‘Inventories’ which closed at $433.67 million, Due from related companies at $180.89 million and ‘Rights of use assets’ amounted to $167.25 million. ‘Property, plant & equipment’ and ‘Cash and Cash equivalent’ closed at $166.25 million and $164.46 million, respectively.

Shareholder’s Equity as at September 30, 2020 totalled $754.09 million resulting in a book value per share of $0.58.


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