Durrant Pate/Contributor

Main Event Entertainment Group, which hemorrhaged under the pandemic, is now out of the red having posted a half-year net profit of J$192.38 million.

This profitability erases the loss of J$19.84 million chalked up during the comparative period last year. For the second quarter ended April 30, 2023, net profit jumped by a whopping 258 per cent to J$74.43 million, up from J$20.81 million the same period in 2022.

Earnings per share (EPS) came to J$0.64 compared to a loss per share (LPS) of $0.07 in 2022. For the April quarter, the EPS amounted to J$0.25, up from J$0.07 in 2022.

Main Event’s stock price closed last week at J$14.72 with a corresponding P/E ratio of 12.15x.

135% growth in revenues

Revenue surged 135 per cent to close the half year period at J$1.16 billion, up from the J$492.54 million during the first half of the 2022 financial year. For the second quarter, revenue went up by a lower margin of 83 per cent to J$531.89 million.

The Solomon Sharpe-led management says the increase in revenues was achieved through strong growth in Main Event’s core business activities. Cost of sales increased 95 per cent to J$543.53 million (2022: J$279.38 million).

Consequently, gross profit increased 189 per cent to J$615.34 million (2022: J$213.16 million). Other operating income went up to J$9.20 million from the J$197,000 booked the prior year.

Total operating expenses increased 76 per cent to J$401.15 million (2022: J$228.25 million). The largest contributor to the increase was administrative and general expenses, which increased 106 per cent to J$333.30 million (2022: J$162.10 million).

The company has explained that the year-over-year quarterly jump in expenses resulted from an increase in staff and other activity-related costs from increased executions in response to customer demands.

Balance sheet highlights

Finance costs declined 31 per cent to J$4.49 million (2022: J$6.55 million) and taxation charge amounted to J$26.52 million compared to the J$1.61 million tax credit in 2022. Total assets as at April 30, 2023 increased 52 per cent to J$1.25 billion (2022: J$827.08 million).

This movement was largely due to a 152 per cent increase in ‘Receivables’ to J$434.31 million (2022: J$172.19 million) followed by ‘Short term deposits’, which amounted to J$226.15 million (2022: nil).

Shareholders’ equity as at April 30, 2023 increased 63 per cent to J$863.38 million (2022: J$529.91 million) resulting in a book value per share of J$2.88 (2022: J$1.77).