Air conditioning and energy company, CAC 2000 Limited, has shown recovery during the second quarter of its 2023 financial year but this was insufficient to reverse the massive J$51.81 million losses during the first quarter.
For the February-April second quarter, the company recorded net profit of J$6.54 million, which is indicative that CAC is exhibiting some level of recovery but insufficient to reverse the massive Q1 2023 losses. This performance has resulted in CAC reporting a year-to-date net loss of J$45.26 million.
CEO Gia Abraham commented, “some may wonder why our numbers in April 2022 were better than that of April 2023, and based on our in house analysis it was found that most if not all of it is attributable to finally being able to realise revenues on projects that had been awarded to CAC before the world wide pandemic hit, and the two years of logistical nightmares ensued.”
Continuing, she said, “our logistics have returned to some semblance of normalcy and even thought the basic lead times have increased on all products, we have seen shipping prices and container availability stabilise, to much more palatable rates and delivery times.”
Revenues whilst less when compared to the same period last year, gained an additional J$131million over the first quarter.
According to Abraham, “as a company we are on a much more positive trajectory, which is further bolstered by the increased number of requests for quotes and tenders we have started to see in the market place compared to 2022. CAC’s big takeaway from COVID is the definite need for diversification, and the level of diversification we are embarking upon will become more and more apparent in the upcoming months, starting with the revamping of our overall marketing strategy and presence in the market place.”
On the positive side, the management team continues to make significant strides in improving operational efficiencies, as expenses continue to trend downward over the previous year with a 17.5 per cent decrease. The overall trend is expected to continue, as the company streamlines its operations to reduce waste and impact of its environmental footprint.
Trade receivables down 30%
Trade receivables are on the decline, falling by 30 per cent during the second quarter (J$520.45 million vs. J$743.29 million) over the same period last year. The reduction in receivables is attributable to the commendable efforts of the team’s focus to reduce the impact of IFRS 9 (expected credit loss) on the bottom line, increase cash inflows and collect long outstanding tax withholding exemption certificates.
This, is in addition to the drive to shrink down debtor days, where all these initiatives will ultimately create a positive impact on the company’s financial performance. Inventories decreased by five per cent with the CEO articulating that as CAC 2000 receives backordered items for projects, it can finally close out revenue on overdue projects, thereby improving the overall customer satisfaction.
Shareholder’s equity declined as compared to the same period last year, as a result of the loss position.
The management team continues to aggressively work on building its presence in the market, as the company launches new products such as energy efficient portable air conditioners, remote and WiFi controlled ceiling fans, air purifiers and dehumidifiers, all of which are available at its new retail store, which opened on March 16, upstairs at Shop 3U, Village Plaza.
CAC will continue to focus on expanding the markets served, along with its offerings and recognize that some of the newly implemented initiatives and the ones to come on board will take time to bear fruit.
However, the management team remains committed to delivering long-term value to shareholders and believe that CAC 2000 will emerge from this period stronger and more competitive than ever before.