Board remains cautiously optimistic on the future

Real estate developer and medical services provider GWEST chalked up more losses last year, as it faced an uphill battle towards profitability.

For the nine-month period ended December 31, 2020, the company recorded another big loss amounting to $50.10 million relative to the loss of $63.15 million reported in 2019. Net loss for the December quarter was to $13.13 million, down from the $20.98 million loss reported for the same period in 2019.

As a result, the loss per share (LPS) for the period under review amounted to $0.10 compared to the LPS of $0.13 recorded in 2019. The LPS for the quarter was $0.03 coming from an LPS of $0.04 in 2019. The trailing-12-month LPS amounted to $0.07.

Revenues were down 14 per cent to $87.32 million for the nine-month period when compared with the $101.83 million booked in 2019. Revenues declined by one per cent or $413,000 for the third quarter, amounting to $32.51 million coming from $32.92 million in 2019.

On the positive side, revenues from leases increased quarter over quarter, but revenue from patient fees continue to underperform, due to the reduction in economic and business activity brought on by the onset of the COVID-19 pandemic.

Cost of sales amounted to a total of $18.67 million relative to the $24.81 million reported for the same period last year. For the quarter, cost of sales rose from $6.35 million to $6.70 million.

Falling gross profit

Consequently, gross profit fell 11 per cent or $8.37 million to a total of $68.65 million relative to the $77.01 million for the corresponding period in 2019. For the quarter, there was a three per cent fall in gross profit to $25.80 million compared to $26.57 million the prior year.

For the nine-month period, administrative expenses declined by two per cent to close at $100.28 million coming from $102.29 million in 2019. However, there was a five per cent increase during the last quarter, due to the increase in expenses associated with COVID-19 protocols.

For the December quarter, administrative expenses increased from $34.02 million in 2019 to $35.88 million in 2020. Other operating expenses was nil for period under review compared with 2019 booked amount of $406,000, while finance cost amounted to $26.91 million relative to $37.57 million for the comparable period in 2019.

Board expressing cautious optimism

In spite of the poor financial outturn, the board of the Montego Bay-based, GWEST is cautiously optimistic about the future based on certain current developments. The chief among these is the construction of its Ambulatory Surgical Centre and overnight inpatient Unit, which started during the last quarter.

This is projected to become operational by the second quarter of the next financial year and should result in increased revenues for GWEST. Also, “we continue to see increase enquires for our investments property and we expected to see improvement in the occupancy levels in the upcoming periods,” the board reported to shareholders.

As at December 31, 2020, the company had total assets of $1.60 million, down six per cent to the $1.71 billion reported in 2019. This was due to a 55 per cent decrease in ‘Property and equipment’ which closed at $226.46 million (2019: $498.91 million).

Shareholders’ Equity totaled $617.96 million (2019: $652.41 million) resulting in a book value per share of $1.27 (2019: $1.35)