Revenue up nine per cent to $450.99 million

Tropical Battery, the newest publicly listed company in Jamaica, is reporting a profit for its just ended December 2020 quarter of $19.04 million, up 26 per cent.

The company reported profit of $15.09 million during the comparable period in 2019. No taxes were reported for the period given that Tropical Battery is benefitting from a 10-year tax waiver, as a junior market listed company, compared to a tax charge of $7.81 million in 2019.

As such, profit before tax closed at $19.04 million for 2020, a decrease of 17 per cent from the $22.90 million booked last year. However, net profit for the three months increased to $19.04 million.

Tropical Battery recorded revenues in the amount of $450.99 million compared with $498.24 million recorded in 2019, representing a decline of nine per cent. The company’s management attributing the decline to “supplier shipment delays”.

Cost of sales in 2020 amounted to $314.70 million, which represents a 10 per cent decrease in comparison to the $349.03 million booked in the previous year. Consequently, gross profit totalled $136.29 million, nine per cent down from $149.20 million reported the prior year.

Expenses cauterised to close 6% lower

Administrative, marketing and selling expenses fell by six per cent to close at $103.68 million versus $110.74 million reported in 2019. Operating profit for the period totalled $32.61 million (2019: $38.47 million).

Other operating income for the period amounted to $3.02 million, representing a 389 per cent surge relative to the $616,935 booked the previous year. Finance costs increased year over year by 45 per cent to a total of $13.56 million (2019: $9.36 million).

Financial income closed the period at $5.97 million (2019: nil). In addition, depreciation closed at $9 million (2019: $6.83 million).

Announcements to be made later this year

The management reports that its strategic partnership drive is moving apace.

“We are making good progress with our pipeline of potential partnerships and strategic acquisitions in Jamaica and across the Caribbean region. We will have one or two to announce later this year,” the management advised shareholders.

Additionally, demand continues to be strong for the brands marketed by Tropical Battery. The management reported that its new Ferry retail store continues to perform above expectations.

As at December 31, 2020, total assets amounted to $1.58 billion. The largest contributors to the assets base are ‘Inventories’ which closed at $433.67 million. Inventories due from related companies amounted to $180.89 million and ‘Right of use assets’ totalled $167.25 million.

‘Property, plant & equipment’ and ‘Cash and Cash equivalent’ closed at $166.25 million and $164.46 million, respectively. Earnings per share (EPS) for the first quarter amounted to $0.015 versus an EPS of $0.012 for 2019. The trailing 12 months EPS was $0.026. Tropical Battery closed the trading period on February 15, 2021 at $1.17 with a corresponding P/E of 45.69 times.