JAM | Sep 18, 2022

LAB finances dragged down by Scope Caribbean

/ Our Today

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However, management reports that subsidiary showing promise for growth

Durrant Pate/Contributor

Media and advertising company, Limners and Bards Limited saw its latest reported finances dragged down by its subsidiary, Scope Caribbean, which posted a J$2.50-million loss for the nine months ended July 31, 2022.

Limners and Bards Limited, which trades on the Jamaica Stock Exchange under the name, The LAB, saw a 1.5 per cent growth in net profit, which increased by J$2.1 million to J$144.3 million for the period under review compared to J$142.1 million in the corresponding period last year. The increase in net profit is attributable to increased revenue and gross profit.

However, the management reports that the group result “is impacted by the J$2.5-million loss recorded by Scope over this period. The net profit includes finance income of J$2.9 million compared to J$20.5 million recorded in the corresponding period of the previous year. For a fair comparison, we exclude Scope and Investment Income and note that the adjusted net profit is $143.9 million vs $121.6 million, a 18.3 per cent increase over the prior year.”

Kimala Bennett, managing director of The LAB.

The management of chairman, Steven Gooden and Chief Executive Officer Kimala Bennett explains that, “while Scope recorded a $2.5-million loss for the nine months, we have seen greater take-up of the services offered and we expect more clients to come on board. We anticipate profitable returns in the coming year”.

Scope showing signs of growth

The Lab advises shareholders that “Scope is showing promise for growth and we continue to explore all avenues, as we place Scope in a position to maximise returns based on the opportunities that arise”.

Revenue for the nine-months is up 18 per cent to $1.1 billion compared to J$942 million for the corresponding period last year.

The revenue growth is attributable to increases in the company’s core business, media placement (up J$94.3 million or 18.7%) and advertising agency (up J$57.1 million or 53.1%). Production was flat when compared to prior year. Gross profit increased by J$95.1 million or 33.4 per cent over the corresponding nine-month period in the prior year.

Due to tight cost management, gross profit margin was at 34.2 per cent compared to the 30.2 per cent in the prior period. Administration expenses have increased by J$70.2 million, or 44.6 per cent in comparison to the previous nine-month period.

These increases are primarily attributable to staff costs (as the company builds capacity to adequately meet the future demands), repairs and maintenance of production equipment and depreciation and amortization costs. The consolidated balance sheet shows total assets increasing by J$165.7 million or 20.0 per cent to J$992.7 million compared to J$826.9 million in the corresponding period last year.

Improved receivables drove up assets

Current assets increased by J$171.3 million primarily because of increases in receivables (J$265.5 million). Cash and cash equivalent decreased by J$81.5 million mainly due to capital purchases and payment of dividend. The increase in receivables is mainly due to increase in revenue. We continue to have tight monitoring and controls over the receivables.

The Lab says its work-from-home programme has proven effective as the company continues to minimise exposure of its staff and at the same time maintaining team productivity and engagement.


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