Strong first quarter for Wisynco

Wisynco Group enjoyed strongly increased revenues in the fiscal first quarter with a rise of 34.6 percent to $9 billion versus $6.8 billion in the June 2018 quarter and resulted in pretax profit jumping 52.7 percent to $1.4 billion and after-tax rising 53 percent to $1.18 billion.
According to brothers William and Andrew Mahfood, Chairman and Chief Executive Officer respectively, in their joint commentary accompanying the quarterly, “we had very strong growth in our core beverage brands as a result of increased demand and improved efficiencies in plant productivity. In addition, the strategic alliances between Worthy Park and St Mary’s Snacks along with increasing revenue from other portfolios contributed to drive revenues to new highs.”
The quarterly revenues are much higher than the $6.9 billion generated in the June quarter and profit of $694 million after-tax.Gross Margin slipped to 36.8 from 38.2 percent in 2018 but Gross Profit still increased to $3.3 billion or 29.8 percent above the $2.6 billion achieved in the June 2018 quarter.
According to the directors, “the leveraging of our distribution system with the new portfolios, while driving revenue growth, favorably impacted our expense to sales ratio that declined to 22.5 percent of sales from the 25.6 percent for the first quarter of 2019. Selling, Distribution and Administrative expenses for the quarter increased by 18 percent to $2 billion above the $1.7 billion for the prior year and well below the increased revenues. For the quarter ended September 30, 2019, Wisynco recorded Net Profits Attributable to shareholders of $1.2 billion or 31 cents per share compared to $769 million or 21 cents per share, an improvement of 47.6 percent over the corresponding period of the prior year.
The Group had equity capital of $12 billion with loan funding of $2.6 billion but with cash and investment funds at $5.5 billion after the Group operations delivered cash inflows of $1.64 billion. Net Current Assets stood at $6.2 billion with current assets of $11.5 billion.
IC Insider.com projects earnings of $1.40 for the current fiscal year with revenues reaching just under $37 billion and $1.95 for 2021. The stock closed at $22 and now sells at a PE ratio of 15 times the current year’s earnings and is fairly valued currently and seems to hold good long-term growth potential.