Q3 profit jumps 73% at Lasco Manufacturing

Lasco Manufacturing products.

Lasco Manufacturing profit, jumped 73 percent in the December quarter, to $195 million from $113 million in 2016. For the nine months to December, profit fell 24 percent to $533 million from $700 million in 2016.
Sale revenues rose 22 percent for the quarter, to $1.78 billion from $1.46 billion but fell 3 percent for the year to date, to $5.28 billion from $5.42 billion in 2016.
Improvement in profit margin in the first half of the year, declined in the December quarter to 32 percent from 34 percent in the 2016, for both the quarter and year to date period, as input cost climbed 27 percent, compared to just 1 percent for the year to date period. The effect, operating profit rose just 12 percent in the quarter to $561 million from $503 million but fell 9 percent for the year to date, to $1.66 billion from $1.83 billion in 2016.
Other operating expenses fell 10 percent to $301 million in the quarter but rose 5 percent in the nine months period to $698 million. Finance cost declined in the quarter, to $34 million from $42 million in 2016 and from $126 million to $99 million for the nine months period.
Earnings per share came out at 5 cents for the quarter and 13 cents for the nine months and should end the fiscal year ending to March around 20 cents.

Bottle heating machine at Lasco Manufacturing.

Revenues and profits were impacted earlier in the year, by a number of factors including phasing down production in April and May, and additional marketing and brand building investments to support the brands and distribution discounts to support sales. The phasing down of production allowed for critical plant upgrades necessary for sustained improvements in output, cost efficiencies and quality. The expected improvements have materialized’ the Managing Director, James Rawle, stated in his report accompanying the quarterly.
Gross cash flow brought in $694 million but growth in receivables, inventories, addition to fixed assets offset by loan inflows and increased payables and paying $143 million dividends net overdrawn position ended at $518 million. At the end of December, shareholders’ equity stands at $4.84 billion with borrowings at just $1.75 million. Net current assets ended the period $1.52 billion well over Payables of $1.05 billion.
The company rolled out new juice drink in the December quarter and plan to launch carbonated beverages and an energy drink in the March quarter.
The stock traded at $4.40 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 22 times 2018 earnings. The company will go into a new year, come April, that should result in a lowering of the PE with IC Insider.com forecasting 30 cents per share for PE of 15 times earnings.

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