Positive out-turn attributable to strong product demand

Caribbean Cream Limited, which trades under the name KREMI, has doubled its net profit attributable to shareholders for the just ended May quarter.

Net profit during the quarter under review went up to $54.16 million from the $27.06 million booked for the comparable quarter in 2020.

Profit before taxation amounted to $61.90 million relative to $30.92 million in 2020, representing a 100 per cent increase year-on-year for the period.

Taxes of $7.74 million were charged for the period relative to $3.87 million booked in the corresponding quarter in the prior year. As such, the earnings-per-share for the quarter was $0.14 relative to $0.07 for the same quarter last year.

Strong demand for products

Turnover for the quarter rose by 28 per cent to $548.45 million coming from $429.98 million posted in 2020. The Christopher Clarke chaired company has expressed its deep gratefulness for the continued strong product demand for its products while working on its strategy to get closer to consumers

Cost of sales also increased by 17 per cent to $340.92 million compared to $291.55 million for the comparable period in 2020, while gross profit increased by 50 per cent to $207.53 million compared to $138.42 million in 2020. Administrative expenses rose by 37 per cent to close at $125.61 million (2020: $91.96 million).

In addition, selling and distribution costs rose by 21 per cent from $12.59 million in 2020 to $15.22 million for the period under review. According to management, “the increase was because of higher transportation cost resulting from more deliveries, an internal reclassification of electricity, salary increases, staff-related expenditures due to COVID-19 safety measures and the full annualized cost for the new Ocho Rios depot.”

Nevertheless, operating profit for the quarter amounted to $66.70 million, up 97 per cent relative to the $33.87 million booked in the prior year. Finance costs for the first quarter grew 49 per cent to $5.03 million relative to $3.37 million reported in the prior year’s first quarter.

Balance Sheet Highlights:

Interest income decreased by 45 per cent to $229,852 from $418,924 recorded in the prior comparable period. KREMI, as at May 31, 2021, recorded total assets of $1.42 billion, an increase of 23 per cent when compared to $1.15 billion recorded last year.

The increase in the asset base was due mainly to a $128.18 million increase in ‘Cash and Cash Equivalents’ which closed at $264.20 million (2020: $136.02 million). Additionally, there was a $102.36 million increase in ‘Property, Plant and equipment’ to close at $862.65 million (2020: $760.30 million).

Total stockholders’ equity as at May 31, 2021, closed at $888.09 million (2020: $771.29 million) resulting in a book value per share of $2.35 (2020: $2.04)