Main Event Q1 profit climbs 41%

Main Event Q1 profit rise 41% to $33m.

The 2017 listed Main Event, enjoyed a bounce of 41 percent in profit for the January 2018 quarter, to $33 million from $23 million in 2017, from sale revenues that rose just 8.6 percent, to $361 million from $333 million in 2016.
Much of the success for the period arose from an improvement in profit margin that rose to 44 percent from 40 percent in the 2017, as input cost remained flat at $201 million. Operating profit rose 22 percent in the quarter to $161 million from $132 million.
Depreciation climbed 40 percent to $21 million, Marketing and sales expenses increased by 132 percent to just $7.8 million, Administrative expenses moved up by 13 percent to $97 million, from $86 million in 2017. Finance cost declined in the quarter, to $3.4 million from $4 million in 2017.
Earnings per share came out at 11 cents for the quarter up from 10 cents in January 2017.
While revenues and profit grew in the quarter, not all areas performed as well. According to the Directors’ report accompanying the quarterly, revenues “was driven by expansion in our core business of entertainment and promotions, with increased opportunities coming from our major clients and increased revenue opportunities from our growing rental and décor equipment base. Revenues from audio, multimedia and digital signage were average.”
Gross cash flow brought in $53 million but growth in receivables, inventories, addition to fixed assets offset by net loan inflows resulted in net outflows of $38 million leaving cash funds at $23 million for the quarter.
At the end of December, shareholders’ equity stands at $479 million with borrowings at just $147 million. Net current assets ended the period $115 million well over Payables of $93 million.
The stock traded at $5.81 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 10.6 times 2018 earnings with room for the price to grow.

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