Revenues at GraceKennedy rose 9.7 percent to $117.8 billion, over $10.4 billion earned for the nine months to September over the same period in 2022. Profit before tax reached $8.8 billion, up by J$1.1 billion, or a 14 percent increase, while net profit after tax rose 14.2 percent to $6.4 billion.
Profit attributable to stockholders hit $6 billion, a 15.3 percent increase over the corresponding period last year. Earnings per stock unit for the period were $6.02, compared to $5.23 in 2022.
Earnings per share for the full year ending in December should hit the $8 market, with PE ratio of 9 based on Thursday last traded price of $71.50.
The company stated that “GK’s food business demonstrated strong performance, with notable growth in revenue and profitability for the period. GraceKennedy Financial Group also delivered a positive performance, driven by strong top-line growth”.
A dividend of $0.65 per stock unit has been announced and will be payable on December 15, 2023, totalling approximately $643 million. This is the fourth and final dividend payment by GK for 2023, bringing GK’s year-to-date total dividend pay-out to approximately J$2.15 billion.
Profit rises 14% at GraceKennedy
Rich year for Carreras’ shareholders
Carreras declared yet another dividend payable to shareholder in December, with the latest being $1 per stock unit to be paid out of proceeds received from the liquidation of a subsidiary. The payment is pending the granting of a transfer tax exemption pursuant to the Transfer Tax Act.
The interim special capital cash distribution will be paid on December 18, to stockholders on record as at December 1, 2014. The ex-dividend date is November 27. The distribution follows the interim dividend of $1.20 per stock unit due for payment on December 11, 2014, to stockholders on record at November 20. The payment will bring to total for 2014 to $8.09 for a return of 22 percent for the year based on the stock price of $36.75 at the end of 2013. The stock closed at $37 on Friday on the Jamaica Stock Exchange.
In September, Carreras paid an interim dividend of $1.20 per stock unit, the company also paid an interim dividend of $1.75 per stock unit on June 26. On March 13 they paid $1.62 per share.
A special capital cash distribution of $1.34 per stock unit was paid on July 31 and a special capital cash distribution of $1.18 was last paid on January 30, this year.
Profit up|Carreras just announced results for the six months to September, with an 18.5 percent increase in revenues for the quarter, over that of 2013 and 19.3 percent for the six months, to September.
Profit after tax, rose 28 percent in the quarter, to reach $614 million, up from $485 million in 2013, and for the six months, growth was less robust, at 12 percent, to reach $1.22 billion from $970 million.
Profit margins got squeezed, rising only 13 percent for the six months and 9 percent in the quarter, no doubt due to the devaluation of the local dollar and the lack of a price increase so far. Revenues are recovering from the 2013 price increase, and from the front loading by merchant of inventories ahead of the increase. The company is on track to earn somewhere in the region of $6 per share for the current year, that will help move the price up. The stock remains IC Insider BUY RATED.
Q3 profit up 20% at Hardware & Lumber
Hardware & Lumber recovered somewhat from the poor results in the second quarter, with sales revenue of $1.72 billion for both quarters, with the latest quarter just slightly higher than the same period last year, with sales of $1.71 billion.
Hardware and Lumber reported a 20 percent increase in profit for the September quarter to $44 million or $0.54 per stock unit, compared to last year’s $37 million or $0.46 per stock unit. The latest result is in contrast to a 34 percent fall in profit for the June quarter, year over year. Profit after tax for the nine months was $113 million, or 26 percent more than the $90 million, for the same period in 2013. Earnings per stock unit for the nine to September months is $1.40, up from $1.11 for the comparative period in 2013.
Gross profit for the nine-month period, fell to $1.22 billion compared to $1.3 billion for the comparative period last year, but for the latest quarter, it ended at $422 million, just slightly lower than the $435 million in 2013. Gross margin fell to 32.5 percent from 34.17 percent, in 2013, for the quarter and for the 9 months period 30.4 percent and 35.1 percent in 2013. Total revenues for the nine months is $5.25 billion, an increase of 5 percent ahead of $5 billion achieved in the same period last year.
Operating cost for the quarter was down to $370 million from $380 million in 2013 and for the nine months, cost fell to $1.123 million from $1.17million in 2013.
Looking ahead, the company increased inventories to $1.6 billion, from $1.1 billion in 2013 and reduced cash to $257 million from $388 million while borrowings fell from $494 million in September 2013 to $320 million, helping to reduce finance cost from $36 million down to $23 million for the nine months. For the latest quarter finance cost was slashed from $12 million down to $7 million.
The company results recovered from the poor June quarter and puts them on track to post $4.35 per share for the full year, with the December quarter being their biggest, for revenues and profits.
The stock remains Buy Rated with the price at $6.50 with much upside gains ahead.
Purity’s 2014 profit & stock price falls
Periods of major economic adjustment negatively affecting consumers, can be tough for bakeries, as demand pressures tend to squeeze margins. That is exactly what happened to Consolidated Bakeries, better known as Purity, for the first six months of 2014.
For although sales’ revenues for the period to June 2014, grew 17.9 percent over the six months to June 2013, profit fell 19 percent to $14.7 million from $24.4 million in 2013. Profit, in the June quarter fell 28 percent to $7.3 million while sales’ revenues for the quarter rose 22 percent. During the six-months, Consolidated said, exports grew 25 percent in US dollars, over the same period last year.
According to management in their report to shareholders for the June results “revenue growth over the six month period in 2013, represent growth in all product categories. This growth is a result of our strategy to grow distribution and volume. During this period, price increases were low due to market competition and in a response to difficulties shoppers face.”
Gross profit| Gross profit margin that ended last fiscal year at 54 percent, fell to 44 percent in the March quarter, 47 percent for the June quarter and for the six months 46 percent. The decline was a major factor dragging profit down for 2014. For 2011, gross profit ended at 62 percent, leaving much room for improvement for management going forward.
Operating cost| comprising administrative, selling and distribution cost, rose sharply by 21 percent for the June quarter to $57 million and 15 percent for the six months, hitting $113 million, faster than the increase in gross profit.
The company has lots of work to do, to improve gross profit margin as well as the paltry return on equity of 6 percent for 2014.
Borrowed funds amount to $57 million at the end of June at a very comfortable level with equity at $518 million. Cash funds available amount to $111 million.
Property plant and equipment was increased by $17 million up to June 2014, additional machinery was ordered to build capacity.
Watch this one| The company has room to grow faster than the economy for a while, this can make it a good growth prospects for investors looking long term. IC Insider’s forecast for earnings per share is around 15 cents for 2014. It may not be until 2015 that the earnings could show improvement to help push the stock price upwards in a major way.
