Montego Bay-based stevedoring, equipment leasing and management company, Cargo Handlers Limited is seeing a marked drop in revenues and profits as a result of COVID-19.

For the December 2020 quarter, the company, which in the business of handling bulk and containerized cargo, with specialization in cement, lumber and steel saw its net profit plummeting to $27.86 million, registering a 22% decline over the $35.91 million reported for the comparable period in 2019.

Operating profit for the quarter fell by 9% from $41.36 million in 2019 to $37.73 million in 2020, while finance costs declined by 40% to close at $314,140 compared to the $522,655 reported in 2019. Interest income booked during the quarter amounted to  $326,119 relative to $271,684 for the corresponding quarter in 2019, representing a 20% increase year over year.

Profit before taxation fell by 8% to close the period at $37.74 million coming from $41.11 million in 2019. Cargo Handlers for the three months ended December 31, 2020 reported revenues of $81.71 million, which is 6% lower than the $87.11 million booked in 2019.

Revenue hindrance

The company advised shareholders that, “containerized cargo volumes continue to be negatively influenced by the effects of the global pandemic.” The company emphasized that its revenue potential was hindered by the fact that “there were no cruise homeport activities during the quarter with a timeline for the resumption of cruise vessel sailings remaining elusive so far.”

Cost of sales closed at nil (2019: $1.70 million). As a result, gross profit amounted to $81.71 million compared to $85.40 million in the prior comparable period. Other income totalled $173,568 (2019: $75,000,whilst gain on exchange totalled $595,768 relative to the $1.10 million reported a year prior.

Administrative expenses decreased 4% to close at $6.19 million coming from the 2019 posting of $6.47 million, while other operating expenses decreased by 0.5% to $38.56 million for the period relative to $38.74 million in 2019. Total expense for the quarter amounted to $44.75 million compared to $45.22 million for the corresponding period in 2019.

Navigating safely through COVID-19

The management reports that in spite of COVID-19 the team is cautiously optimistic about 2021. According to the management team, “we cautiously approach the new calendar year undaunted by the challenges created by a pandemic that continues to foreshadow our short to medium-term plans. We are confident in the ability of the team we have at Cargo Handlers to safely navigate our way through these challenges while actively pursuing emerging opportunities that complements our core business and adds value for our shareholders.”

Earnings per share (EPS) for the quarter amounted to $0.07 compared with $0.09 for the corresponding period of last year. The trailing EPS amounted to $0.24. The numbers of shares used in the calculations are 416,250,000 units.

For the three months ended December 2020, assets totalled $590.75 million relative to $555.20 million as at December 31, 2019. The 6% increase in total assets was largely due to ‘Investments’ ending at $104.25 million (2019: nil).