Lumber Depot profit surges
Profits at Lumber Depot bolted 555 percent from $22 million for the nine months in 2020 to $145 million for the year ended April 2021, as it grew revenues 14.7 percent to $1.43 billion from $921 million in 2020 nine months period.
The company operates a hardware store in Papine, St Andrew, for more than two decades and generated revenues that rose 7 percent in the April quarter over the January 2021 quarter to $377 million from $353 million and 21 percent over the April 2020 quarter of $311 million. Gross profit margin for the full year was 21 percent, an improvement on the 18 percent for the 2020 nine months period. Administrative costs rose 42 percent to $154 million from $108 million in the nine months to March 2020, but it would be up by 7 percent if the comparative periods were the same number of months.
Cash inflows for the year pulled in $157 million, but after working capital adjustments the amount climbed to $186 million and ended the year with a net gain of $114 million after dividend payment of $14 million and loan repaymentof $33 million. The company has cash funds of $143 million and investments of $117 million at the end of April, with the latter shown as a noncurrent asset.
Current assets stood at $317 million and current liabilities at $139 million, resulting in net current assets of $178 million. Shareholders’ equity grew 68 percent to $523 million and pushed cash and investments to $360 million from $129 million in 2020.
The company reports earnings per share of 21 cents, up from just 3 cents in 2020.
The stock traded 580,827 units up to $3.65 in early trading on the Junior Market of the Jamaica Stock Exchange, but the price dropped back to close at $3.50 at a PE of 16.7 times 2021 earnings and 13 times ICInsider.com’s projection of 27 cents for 2022.
JSE Main Market Grace Kennedy returns after a week’s absence and replaces Jamaica Broilers that is now out. 
This past week the average gains projected for the Junior Market rose from 200 percent last week to 202 percent and Main Market stocks edged down from last week’s 171 percent to 168 percent.
For the Junior Market to trade at the historical average, the PE Ratio would have to rise by 32 percent and requires a rise of 53 percent to reach the targeted PE of 20 by March 2022. Main Market stocks would need to rise by 11 percent to hit a PE of 19 and 17 percent to get to the target of 20.
IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely increase for each company, taking into account the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.
The Junior Market recovered all of its Covid-19 related loss and more in hitting its highest level this week, since the first week of December 2019, helped by a number of ICInsider.com Top stocks of which 6 recorded gains between 69 percent and 81 and two over 100 percent, with the market up 29 percent for 2021 to date. 
The top three stocks in the Junior Market are Elite, Caribbean Assurance and Medical Disposables, with the potential to gain between 223 and 287 percent, following the range of 254 to 276 percent last week. The top three Main Market stocks are Radio Jamaica in the number one spot, followed by JMMB Group and Guardian Holdings, with expected gains of 171 to 379 percent versus last weeks’ 188 to 385 percent.
For the Junior Market to trade at the historical average, the PE Ratio would have to rise by 31 percent and requires a rise of 54 percent to reach the targeted PE of 20 by March 2022. Main Market stocks would need to rise by 11 percent to hit a PE of 19 and 17 percent to get to the target of 20.
“We have expanded our grocery stores in St Lucia from 3,000 to 8,000 square feet in May and we are building out 9,000 square feet grocery store in the centre of Castries and working on breaking ground and should be ready in six to nine months. In the north of St Lucia, we are looking at a 19,000 square foot retail store and in Montego Bay, we are expanding a 1,200 square feet retail store to 6,000 square feet.” “We have identified acquisition candidate in Jamaica and we are exploring,” Thomas Tyler stated; he went on to further state that the plan is “for revenues in St Lucia to move from US$15 million per annum now to $50 million in 3 years.”
Main market had three days of decline but ended the week with a fall of points after recording a strong rise the previous week.
This past week the average gains projected for the Junior stocks slipped from 207 percent last week to 204 percent and the Main Market stocks moved up from last week’s 166 percent up to 172 percent with the upgrading of JMMB earnings.
The Junior Market closed the week with an average PE 13.1 based on ICInsider.com’s 2021-22 earnings and currently trades well below the target of 20 and the recent historical average of 17 for the period to March this year based on 2020 earnings. For the market to trade at the historical average, the PE Ratio would have to rise by 31 percent and require a rise of 52 percent to March 2022 to reach the targeted PE of 20.
The Main Market TOP 10 trades at a PE of 7.9 or 46 percent of the PE of that market, well off the potential of 20.
The company, which is said to be dedicated to investing in and funding real estate developments through a combination of debt capital as well as equity capital, has projects on its books already, with developments in St Ann, St Catherine and Kingston, which the principals expect to extract extra value by way of creative acquisition and disposal. The company strategy is to fund new developments through real estate notes secured by a charge over the properties.
Reports reaching ICInsider.com indicate strong buying interests locally and from overseas in townhouses and detached units in the country’s hills, and many see Jamaican real estate as cheap.
The market was only above Friday’s close for one day in early January last year when the index closed at 3,378.20 points on January 3 and one day in June this year.
Timely data critical for proper market functioning
Persons running the financial market seem not to understand the import of data to the proper functioning of the Jamaica market.
The Jamaica Stock Exchange has granted 45 days extension for companies to file their audited financial statements for 2021 to July 14, 2021. The extension assists management and auditors in managing the execution of audits at a challenging time and that may be fine, but what about the users of the reports?
While that can be appreciated, insufficient thought has gone into the decision. The companies and auditors are not the only persons to be accommodated in this issue. Investors need timely information to make decisions. Management of the companies are clearly not concerned about their shareholders either and the Jamaica Stock Exchange seems to care even less even though they will state otherwise.
This publication wonders why could the decision to extend the time by 45 days not have required the companies concerned to file interim results to obtain the extension, that way investors would be in a far better position than having to wait more than three months to get up to date position on the finances of such companies.
After all, minority shareholders have rights too and deserve better than what they are getting.