Jamaican soap manufacturing group, Blue Power has seen a dramatic turn-around in its profitability with net profits growing by a whopping 291 per cent to $211.10 million for the half-year period, ended October 31.

Profit before tax totalled $202.72 million compared to $66.52 million in 2020 followed by tax charges of $7.68 million in comparison to the $16.63 million levied in 2020. Net profit for the October quarter amounted to $148.63 million coming from $16.79 million in the comparable period in 2020.

Total comprehensive income came out at $183.04 million versus $53.31 million last year, while for the second quarter total comprehensive income amounted to $113.96 million, representing a three-fold increase on the 2020 posting of $32.75 million.

Revenue retreated during the period

Blue Power Group saw a decline in its revenue for the half-year period, going down by 25 per cent to total $211.10 million compared to $281.96 million for the corresponding period in 2020. Revenue for the quarter totalled $95 million, which is 32 per cent below last year’s corresponding quarter of $140.40 million.

Cost of sales for the period contracted by 21 per cent to $131.65 million from $166.64 million last year. This further translated into gross profit amounting to $79.44 million, a decline of 31 per cent when compared to $115.31 million in 2020.

Gross profit for the second quarter fell 45 per cent to close at $29.93 million (2020: $54.79 million). Administrative expenses saw an increase of 21 per cent to total $81.64 million (2020: $67.58 million).

Loss from operations amounted to some $6.10 million, relative to 2020’s operating profit of $36.90 million, while the second-quarter loss from operations amounted to $14.12 million versus operating profit of $16.57 million in 2020.

Impairment losses on trade receivables closed at $3.79 million, while impairment losses on investment amounted to $109,102. Other income for the period amounted to $49.36 million, a significant increase when compared to the $15.05 million recorded for the same period last year.

In addition, Blue Power reported finance costs of $1.15 million for the period, an 18 per cent increase when compared to $969,696 in the year prior. Finance income fell by 10 per cent to $14.06 million relative to $15.53 million for the corresponding period in 2020.

Balance Sheet at a glance

As at October 31, 2021, total assets amounted to $1.57 billion, up 49 per cent from the balance of $1.05 billion as at October 31, 2020. The increase in total assets was as a result of the increase in Investment, which increased by 51 per cent to end at $652.40 million and Property, plant and equipment, which amounted to $258.18 million coming from $151.34 million in 2020.

The company’s management has highlighted it will begin to co-pack an expanded range of products for the Jamaican market and intends to return our focus to developing the exports of soap in CARICOM and non-CARICOM markets.

Despite the challenges faced by the business, the management is satisfied that the company has taken the necessary resources and skills to profitably diversify, transform and grow.