Disappointing Q1 results
Air conditioning and energy company CAC 2000 Limited has seen its losses soaring during the January quarter, delivering disappointing first quarter results.
The company’s losses soared to J$51.81 million for the quarter under review, up from the J$32.75 million chalked up for the comparable 2022 quarter. At the same time operating profit remained in the negative column but growing to J$37.81 million, up from J$23.98 million in 2022.
Finance and other costs rose to J$11.05 billion for the January 2023 quarter, up from J$8.77 million 12-months prior. On the positive side, there was a slight cut in operating expenses, which closed the January 2023 quarter at J$83.22 million down from J$89.59 million in 2022.
Chief Executive Officer Gia Abrahams commented that, “the management team is making significant strides in improving operational efficiencies and reducing our expenses that continue to trend downward over the previous year with as seven per cent decrease. The reduction is expected to continue as we streamline our operations to reduce waste and improve our environmental footprint”.
However, revenues tumbled to J$127.89 million coming from J$222.23 million in 2022 with Abrahams declaring, “the management team is aggressively working to address the challenges, which impacted the 1st quarter results through several initiatives”.
Continuing, she explains that “while the outcome is disappointing, I want to assure you that your management team has already taken steps to reverse this loss and improve our financial position”.
She also explains that the decline in revenues and net profit was primarily due to a significant decline in revenues projected from the Projects Department. In 2022, Projects suffered significant delays in delivery of goods due to longer lead and delivery times.
However, CAC 2000 was able to substantially increase the number of jobs won since January 31, 2023. For Abrahams, “another positive was that the management team is making significant strides in improving operational efficiencies and reducing our expenses that continue to trend downward”.
Trade receivables activities
Trade receivables declined by 34 per cent from J$657.26 million in 2022 to J$433.20 million for the quarter under review. According to the CEO, “the reduction in receivables is attributable to the commendable teams’ efforts focused to improve trade receivables, especially collecting the long outstanding Tax Withholding Exemption Certificates (TWE), and driving down debtor days, which will ultimately create a positive impact on our financial performance”.
Inventories increased by 22 per cent, which was expected as many of the back logged orders/items were arriving in the fourth quarter of 2022 and this year’s first quarter, which has had an overall negative impact on cash due to clearances and supplier payments becoming due based on the deliveries. Shareholders’ net equity declined by one per cent as a result of the company’s loss position.