Advertising agency’s revenues increase by 44% to $911.74 million

Advertising agency The Limners and Bards Limited (LAB) ended 2020 strong, recording a 34 per cent jump in net profits for the year.

Net profit for the year end ended October 31, 2020, grew to $127.08 million, up 34 per cent compared to the $94.75 million reported for 2019. Net profit for the October quarter was slightly below 2019, coming in at $19.27 million compared to $24.93 million booked in the corresponding quarter of 2019.

Profit before taxation amounted to $127.08 million as against the $107.45 million recorded for 2019. There was no taxation booked for the period under review, whereas taxes for 2019 were $12.70 million.

Earnings per share (EPS) for the yearend amounted to $0.13 compared to $0.10 in 2019, while for the quarter EPS amounted to $0.020 versus $0.026 documented in the prior comparable quarter. Notably, The LAB’s stock price closed the trading period on December 24, 2020 at a price of $2.90 with a corresponding P/E ratio of 21.58 times.

For the year ended October 31, 2020, revenues went up by 44 per cent to $911.74 million versus $631.85 million booked in 2019. Revenues for the quarter rose by 55 per cent to $225.59 million compared to 2019 when the revenues amounted to $145.57 million.

Steady rise in operating cost

Cost of operating revenue rose by 51 per cent for the review period to $613.11 million (2019: $405.12 million). Consequently, gross profit for the period rose by 32 per cent closing at $298.63 million compared to $226.73 million for the same period last year.

For the quarter, gross profit increased 32 per cent to $71.18 million coming from $53.77 million in 2019. The sole listed advertising company reported a 48 per cent increase in total operating expenses to $173.42 million, up from the 2019 amount of $117.23 million.

For the quarter, The LAB, run by CEO Kimala Bennett, reported a 377 per cent increase in total operating expenses which closed the quarter at $173.42 million compared to $36.35 million for the same period in 2019.  Of the total expenses for 2020, administrative expenses jumped 50 per cent to close at $172.87 million relative to $115.15 million in 2019.

Selling and distribution costs closed at $548,564 (2019: $2.09 million) while impairment losses on the financial asset amounted to $1.54 million, up from the $448,216 recorded in 2019.

Assets grew reasonable well for 2020

As at October 31, 2020, the company reported total assets of $676.07 million, a 38 per cent rise when compared to $488.52 million a year ago. This was as a result of ‘Cash and cash equivalents’ and Accounts receivable’ which closed at $380.42 million (2019: $291.58 million) and $158.43 million (2019: $83.84 million), respectively.

Shareholders’ Equity as at October 31, 2020 was $464.23 million compared to $356.06 million a year ago. This resulted in a book value per share of $0.49 compared to $0.38 in 2019.