Jamaica’s premier hotel food and liquors’ supplier Caribbean Producers Jamaica (CPJ) has seen dwindling profitability during its September first quarter, but is optimistic of reversing the negative trend for the upcoming quarters.
Net profit for the review quarter amounted to US$1.23 million, down 28 per cent from the US$1.72 million reported during comparative period of 2022. Taxation amounted to US$393,943, down from US$518,740.
Operating profit for the three months amounted to US$2.47 million, a 18 per cent decline relative to US$3.00 million reported in 2022. Finance income totalled US$149, a 30 per cent decrease from the corresponding period last year (2022: US$214).
Finance cost for the first quarter ended September 30, closed on US$841,817, an 11 per cent increase relative to US$755,378 reported in 2022. In spite of the decline in profitability, the management is very optimistic based on plans now in place.
Future plans explained
According to CPJ, “the projected increase in sales, the completion and commissioning of the expanded manufacturing plant, improvements in general environment, and the opening of the new stores in St Lucia, we anticipate continued growth and profits in upcoming periods.”
The first quarter experienced a 3.0 per cent increase in gross operating revenue, totalling US$34.22 million compared to US$33.06 million in 2022. The management says “the revenue improvement during the quarter was driven by the introduction of new product lines along with the continued development of existing sales channels including our online business”.
Selling and administrative expenses increased by 6.0 per cent, closing at US$6.55 million (2022: US$6.17 million), while depreciation increased by 9.0 per cent from US$1.03 million in 2022 to US$1.13 million for the three months under review. Also, other operating income for the first quarter amounted to US$29,591 relative to US$6,346 reported in 2022.
Earnings per share (EPS)for the review quarter is 0.12 cents (2022: EPS: US0.15 cents). Notably, CPJ’s stock traded last week at a price of J$9.40 with a corresponding P/E ratio of 12.33x.
Balance Sheet Highlights
CPJ’s assets totalled US$89.72 million (2022: US$86.48 million). The growth in total assets was primarily due to ‘Inventories’ increasing by US$1.44 million to close at US$41.80 million (US$40.37 million).
Cash and cash equivalents grew 28 per cent to US$5.27 million (2022: US$4.13 million). Shareholder’s equity was US$30.18 million (2022: US$24.79 million), representing a book value per share of US0.027 cents (2022: US0.023 cents).