Improvement in revenue in three of the five business segments

Durrant Pate/Contributor

Local lubricant manufacturer and distributor, Paramount Trading (Jamaica) is reporting a bumper August quarter, showing significant increases in all its financial indicators.

Year-over-year net profit went up 344 per cent to J$83.9 million, coming from J$18.9 million during the comparable period last year, while revenues are up 61 per cent to J$595.2 million, up from the 2021 booking of J$369.3 million. Earnings per share went up 350 per cent to J$0.054 from $0.012 in 2021 while the company’s book value increased by 22 per cent to J$993.1 million compared to J$815.2 million last year.

Direct expenses closed the period at J$391.84 million, a 52 per cent increase relative to the $258.22 million booked a year ago. Other operating income amounted J$29.37 million for the three months ended August 31, 2022, an improvement of J$16.23 million compared to the $13.14 million booked for the previous year’s corresponding period.

Administrative expenses grew by 36 per cent to J$122.58 million, up from the J$89.82 million recorded for 2021. Selling and distribution expenses fell seven per cent to close at J$2.60 million (2021: J$2.79 million).

Operating profit amounted to $107.52 million compared to $31.63 million for the same quarter of the prior financial year. Gross revenue for the first quarter amounted to J$595.2 million, which surpasses the previous 28 per cen increase recorded, which was highest quarter (Q3:21/22) in the company’s history.

Revenue growth strategies

During the quarter, revenue growth strategies employed by the company resulted in improvement in three of the five segments in both the Manufacturing and Distribution divisions.

The non-growth segments, lubricant and technical grade were impacted by supply chain management challenges, which are being resolved in the second quarter. The management reports that, “consistent with the first quarter of last financial year, this year’s first quarter 61.2 per cent growth in revenue continues to outpace the 31.3 per cent growth in operating expenses, auguring well for the company’s efficiency ratios as evidenced by both consistent and growing gross profit margin (4.1 per cent) and improved net profit margin (10.5 per cent) ratios.”

According to the management, ”we will continue to pivot our operations to take advantage of any possible opportunities that may arise during this period of continuous uncertainty. We expect that our strategic objectives will be realise through strong income growth and cost containment. The board of directors and management team remain steadfast in ensuring that the company continues its growth trajectory”.