Medical Disposables profit slipped in June quarter.
The strong growth in revenues is a positive development and could be a signal for increased future profit, if sales growth continues at a reasonable pace.
Gross profit margin declined, leading to lower gains of 18 percent, in gross profit, to $99 million up from $84 million in 2015. The increase in gross profit was inadequate to meet increasing expenses and thus resulted in lower profit for the June quarter, with profit at $18 million versus $19 million in 2015 while earnings per share ended at 6.8 cents versus 7.3 cents in 2015. Looking forward earnings for the full year is forecast at 65 cents per share and $1.10 for the 2017/18 fiscal year as increase sales delivers more gross profit to overwhelm increased cost. The stock last traded on the junior market of the Jamaica Stock Exchange at $3.15 for a PE ratio of 5.40 based on 2017 earnings and 3.2 based on the 2017/18 earnings.
“The Board of Directors has approved a strategic plan which forecast growth in market share, increase product offerings and widening of the customer base in all categories of its business operations.
Kurk Boothe – Medical Disposables Managing Director.
Profit after Operational Expenses rose by 28 percent to $30.4 million from $24 million in the previous year’s June quarter but finance cost associated with the acquisition of the company’s operating complex, increased from $4.5 million to $12.5 million.
At the end of June, shareholders’ equity stood at $495 million, borrowings amounted to $412 million, current assets stood at $673 million and current liabilities at $352 million.
