Profit at Carreras for the three months to September, is up 26 percent to $614 million, from $485 million in 2013, for the six months growth was less robust, at 20 percent to reach $1.17 billion from $9,71 million.
Revenues recovered considerable grounds, from the lost sales in 2013, from the front loading by merchants of inventories ahead of a pending price increase of cigarettes that the company implemented in March 2013. For the quarter, sales revenues rose 18.5 percent over that of 2013 and 19.3 percent for the six months to September. During last year September quarter, revenues fell 16 percent, so there is still a fall out, but that is usually the case whenever there is sizeable price increase, is effected.
Profit margins got squeezed, rising only 13 percent for the six months and 10 percent in the quarter, no doubt, due to the devaluation of the local dollar and the lack of a price increase so far. Carreras was able to hold cost well below the increased sales revenues for the quarter and year to date. The company is on track to earn somewhere in the region of $6 per share, for the current year and that will help move the price up. The stock remains IC Insider BUY RATED.
Carreras will pay a special capital cash distribution, on December 18, following an interim dividend of $1.20 per stock unit, to be paid on December 11, 2014. The payments will bring to total distribution for 2014 to $8.09.
The stock closed trading on the Jamaica Stock Exchange, at $37 on Friday, putting the PE ratio, at 6 times the current fiscal year earnings.