Fontana Q3 profit jumps

Revenues at Fontana increase by 4.2 percent to $1.22 billion for the March quarter over the $1.17 billion generated in the 2020 March quarter, pushing net profit for the quarter up an impressive 238 percent to $73 million from just $21.6 million in 2020.
Gross profit rose at a slower pace to that of sales growth, with an increase of just 3 percent to $416 million, from $404 million in 2020, which management attributes to a shift in sales mix during the period. “Revenue on some of our higher margin products declined slightly, we saw increases in lower margin product sales which drove the top line,” the directors reported in their commentary on the results.
For the nine months to March 2021, net profit jumped 56 percent to $367 million over the $235 million earned in the 2020 period. The improved profits flowed from an 11 percent rise in revenues to $3.88 billion from $3.49 billion in 2020 for the nine months.
Administrative and other expenses fell from $325 million to $309 million for the quarter and from $944 million in 2020 to $926 million in the nine months to March 2021, while selling and promotion expenses went down to $20 million in the quarter from $22 million and from $79 million in the nine months to $68 million.
Finance costs rose to $32 million, impacted foreign exchange losses recorded in relation to the revaluation of the lease liability, resulting in an additional cost of $12.4 million for the period, the company reports.
Cash flows from operating activities generated $541 million for the nine months, up from $387 million in 2020, but after paying dividends of $100 million, repaying loans and lease commitments of $92 million and providing working capital of $210 million was retained and added to the balance of cash funds of $599 million previously pushed cash on hand to $809 million, an increase of 52 percent.
Current Assets rose from $1.4 billion to $1.76 billion, while Current Liabilities fell from $846 million to $725 million as payables fell from $655 million to $586 million, leaving the company in a healthy financial position. Shareholder’s Equity grew 21 percent to $1.76 billion, from $1.45 billion over the prior year.
Earnings per share ended at 29 cents compared to 19 cents for the previous financial year. ICInsider.com forecast is for earnings of 40 cents for the current fiscal year and 50 cents for 2022. The stock trades on the Junior Market of the Jamaican Stock Exchange at $6.