Chalks up net profit of US$7.72 million

Durrant Pate/Contributor

Montego Bay-based distribution company, Caribbean Producers Jamaica Limited (CPJ), has turned the corner and is recovering strongly for 2022.

Net profit for the financial year ended June 30, 2022 amounted to US$7.72 million, reversing the net loss of $2.52 million booked in the previous year. Taxation for the 2021-22 financial year was US$1.74 million, compared to nil in 2020-2021.

On the other hand, the company reported net profit of US$703,873 for the June quarter, down from the net profit of US$1.27 million booked last year. Net profit attributable to shareholders for this year amounted to US$7.51 million, reversing the net loss of US$2.26 million booked 12 months earlier.

As a result, earnings per share (EPS) for the year amounted to US$0.6826 cent compared to loss per share (LPS) of US$0.2058 cent in 2021. EPS for the June quarter amounted to US$0.06 cent relative to earnings per share of US$0.12 cent a year prior.

CPJ’s stock price closed trading yesterday at a price of J$14.01 with a corresponding P/E ratio of 13.54 times. For the year-end, CPJ saw a 106 per cent increase year-on-year in gross operating revenues, which closed at US$119.96 million, compared to the US$58.18 million for the prior year.

Management pleased with performance

For the fourth quarter, the company posted a 59 per cent increase in revenues to close at US$33.52 million relative to US$21.07 million for the same quarter in 2021.

The management said that “the favourable results were driven by strong cost controls, inflationary increases and incremental growth in volumes, as our products continue to maintain a strong and resilient position in the hospitality and retail sectors, as the company saw the return of the hospitality industry after the impact of COVID-19… . The increase in inventories was a proactive measure enacted due to the ongoing challenges in the global supply chain, where stock holdings were adjusted to ensure sufficient stock was on hand to service the market and keep pace with customer demands”.

Additionally, “CPJ Group continues to maintain a solid financial position and reflects positive management oversight over the working capital health of the Group. While there was an increase in the growth of the accounts receivables portfolio, the accounts receivable days have improved over the last year, revealing the strength of the company’s credit management policies and procedures,” the management declared.

Cost of operating revenue showed a 96 per cent increase closing the period at US$85.12 million relative to US$43.43 million for the previous year. For the June quarter, CPJ recorded a 62 per cent increase in the cost of operating revenue to close at US$26.29 million relative to US$16.22 million for the comparable period in 2021.

Consequently, CPJ recorded a 136 per cent increase in gross profit to US$34.84 million (2021: US$14.75 million), while gross profit for the quarter amounted to US$7.23 million relative to a gross profit of US$4.85 million in 2021.

Selling and administrative expenses were US$18.24 million, a 50 per cent increase from the US$12.14 million posted last year. Depreciation for the year was US$4.21 million when compared to the corresponding prior year of US$4.19 million.

Other financial highlights

Other operating income totalled US$403,695; this compares with other operating income of US$1.32 million booked a year ago. Operating profit totalled US$12.41 million relative to an operating loss of US$335,450 in 2021.

Finance income amounted to US$5,154 (2021: US$33,099), while Finance cost was US$2.95 million (2021: US$2.22 million). As at June 30, 2022, CPJ’s total assets amounted to US$88.46 million, a 33 per cent increase year over year from the US$66.33 million as at June 30, 2021.

The increase was due mainly to an increase in ‘Inventories’ which rose 87 per cent to US$40.16 million versus US$21.43 million reported in 2021. ‘Accounts receivables’ also contributed to the upward movement in the asset base with a 20% increase to US$18.49 million from US$15.39 million in 2021.

Shareholder’s Equity as at June 30, 2022 totalled at US$23.15 million (2021: US$15.64 million) resulting in a book value per share of approximately US$2.105 cents (2021: US$1.422 cents).

Looking forward, the management reports that it will continue to work on enhancing the food-service product line in its markets as well as continuing to upgrade infrastructure, including our trucking fleet, in anticipation for the growth in tourism and to continuously improve our level of service.