Q1 profit up at Jamaican Teas

Jamaican Teas quarterly results to December ended with profits after tax of $36.6 million or 22 cents per share, up 33 percent from $27.5 million in 2014. Profit before tax amounted to $42.5 million, is up from 54 percent from $27.5 million to $42.5 million.
The results came from revenues that grew by 22 percent to $387 million, with real estate sales accounting for $40 million and other income of $15 million which includes gain on sale of investments of $7.5 million.
Gross profit margin grew to 20.6 percent from 19.5 percent in 2014. Selling and marketing cost rose to $8.6 million from $7.3 million by 18.7 percent, administrative expenses was up $30 million from $25.5 million by 17.4 percent and finance cost grew by 76 percent to $10.9 million from $6.2 million.
Going forward interest cost should fall due to two factors. The company has a debenture that carries a variable rate tied to treasury bills, with the latter declining the company will see a reduction in the cost additionally the first phase of the real estate development will release cash to pay down bank borrowing.
There are signs that the economy is picking up and that should help in moving local sales at a faster pace than in 2015.
Based on the first quarter earnings, full year results could be in the region of 85 cents per share, but this could be affected by profit from sale of real estate units and depends on any added gains that may be realized from the sale of the $125 million investments portfolio.
At the end of the quarter borrowings were at $370 million with equity at $79s million. The stock which is quoted on the Jamaica Stock Exchange junior market last traded at $5.