Revenues also up 6% to $23.64 billion

Wisynco experienced a marginal increase in profit during the first three quarters of its 2020-2021 financial year, weathering the downturn in the Jamaican food distribution trade.

The company managed to eke out profit from continuing operation amounting to $2.21 billion relative to $2.17 billion booked for the comparable period in 2020. Profit from discontinued operations was $165.38 million for the nine months ended March 31, 2020 versus nil in 2021.

Profit before taxation amounted to $2.68 billion, relative to $2.67 billion reported in 2020, a one per cent increase year over year. Taxation for the period amounted to $465.29 million (2020: $492.74 million).

As such, net profit decreased five per cent to $2.21 billion relative to $2.34 billion that was posted for the nine months ended March 31, 2020. Net profit for the third quarter amounted to $672.63 million relative to $580.30 million in 2020, a 16 per cent increase year over year.

Net profit attributable to shareholders for the nine months totalled $2.21 billion coming from the $2.34 billion posted last year, while for the quarter net profit attributable to shareholders was $672.63 million coming from the 2020 amount of $580.30 million.

Total revenues go up to $23.64 billion

Total revenues for the period under review amounted to $23.64 billion, down six per cent when compared with the $25.19 billion reported for the same period in 2020. Total revenues for the quarter amounted to $7.60 billion reflecting a decrease of six per cent over the $8.08 billion achieved in the corresponding quarter of the previous year.

Management reports the sharp decline in revenues is due to “the surge in Covid cases during January and February and the Government of Jamaica implemented curfews resulted in business activities being slower than anticipated, although we did see stronger than expected March revenues. Vaccinations have continued in earnest especially in the USA and the UK and we are seeing strong signs indicating a positive bounce-back in the tourism industry and increases in the number of visitors who are expected to come to Jamaica in the months ahead. We have also seen some positive recovery in our Food Service business (inclusive of hotels and restaurants) which we expect to continue”.

The management was quick to point out that, “the expansion of our production facilities over the years have given us the flexibility to increase capacity and during this quarter we recommenced production of Bigga for the UK market at Wisynco. Our growth in the UK for the Bigga brand has been very good and, in the past, we licensed the production of Bigga in the UK to ensure availability. We are proud to therefore bring this production back to Jamaica and look forward to continue growing the UK and all our other export markets. Exports were up 50 per cent in Q3 and 28 per cent for the year to date”.

Cost of sales were also down during the three quarters

Cost of sales for the nine months ended March 31, 2021 amounted to $15.51 billion, down six per cent relative to $16.41 billion reported in 2020. Consequently, gross profit fell seven per cent to close at $8.13 billion compared to the $8.78 billion for the same period a year earlier.

On the positive side, the management highlighted that, “our gross margin at 34 per cent was higher than the 32 per cent in prior year and this was due primarily to better cost efficiencies which include our Cogeneration activities, as well as better than expected sales of our higher margin beverages in March”.

Gross profit for the quarter amounted to $2.58 billion, slightly down from the $2.59 billion reported in 2020.

Total expenses, for the nine months ended March 31, 2021, fell 11 per cent to close at $5.61 billion coming from the 2020 posting of $6.31 billion. Of total expenses, selling and distribution expenses declined 13 per cent to total $4.58 billion, while administrative expenses decreased one per cent to $1.03 billion.

Expenses for the third quarter fell

Total expenses for the third quarter fell nine per cent to $1.88 billion coming from $2.07 billion in 2020. Finance income nine months amounted to $184.95 million, down 13 per cent from the $212.24 million reported for the corresponding period in 2020. Finance costs decreased 10 per cent to $107.06 million for the period from $118.97 million for 2020.

​Wisynco reported share of loss of associate of $27.55 million for the nine months ended March 31, 2021 relative to share of profit of associate of $6.01 million in the corresponding period of 2020. Notably, total comprehensive income for the nine months amounted to $2.24 billion coming from $2.38 billion in 2020.

Total comprehensive income for the third quarter ended March 31, 2021 amounted to $675.95 million coming from the 2020 figure of $604.16 million. Notably, Wisynco’s stock price closed the trading period on May 06, 2021 at $15.78 with a corresponding P/E of 22.09 times.

As March 31, 2021, WISYNCO’s assets totalled $20.66 billion, seven per cent more than the $19.38 billion recorded last year for the same period.  The increase in total assets was largely due to increases in ‘Cash and Short term deposits’ by 58 per cent or $2.54 billion to close at $6.90 billion (2020: $4.35 billion).