Lasco Distributors reported an 11 percent drop in pretax profits in the 12 months ended March this year even as sales climbed 10.6 percent for the same period. The March quarter revenues only grew by one percent, pulling down what was a more robust increase up to the December quarter. But things seem to be back on track in the June quarter as revenues are up 15 percent to $2.31 billion, an increase of $303 million over the corresponding period last year and profit is up to $164.2 million, an increase of 21 percent or $28.5 million over the same period in 2012. Earnings per stock improved from 4 cents in June 2012 to 4.9 cents in June 2013 quarter based on the new amount of shares issued.
LASCO Distributors continues to introduce new brands to market. Most recently, Baby Yum Infant Cereal and Breathezy, a generic alternative for Asthma Management, were launched.
Operating Expenses to Sales ratio was 13.1 percent compared to 14.1 percent, a significant improvement over the corresponding period last year.
“Revenue and profit performance was due to the increased volumes, aggressive marketing activities and improvement in efficiencies,” the company’s Chairman Lascelles Chin stated recently. He went on to say that “It is commendable that even with increased marketing activities and the introduction of new products each year, the company was still able to contain operating expenses. LASCO Distributors continues to do very well and will expand its range with exciting products and grow its revenues with brands from pharmaceutical principals, as well as our own LASCO brands. This will be bolstered in particular from the new products to come from the LASCO Manufacturing expansion.”
The company is looking good going forward, especially after September when the Lasco Manufacturing factory expansion is completed and starts production of new products which will be marketed by the distribution company. IC Insider is forecasting that sales will pick up in the second half of the company’s year and earnings increase to $840 million or 25 cents per share for the year ending March 2014.
The company was able to reduce inventories from $1.28 billion at the end of March to $967 million, as such cash and investments increased from $507 million to $817 million over the same period. Current assets exceed current liabilities by $1.69 million at the end of June. There is virtually no debt financing at the end of the quarter and the equity is at a little over a $2 billion.
Insider call | Lasco Distributors is an IC Insider Buy Rated stock.
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