Unilever Caribbean operations suffered from dislocations associated with a new IT platform, resulting decline in sales and profit particularly in the first quarter.
The company has now reported that in the second quarter the issues were resolved and service levels are now fully restored to our customers, thanks to enormous effort by employees succeeded in bringing about the turnaround. Despite these efforts, half year sales declined by 10.3%, driven predominantly by the declines in the first quarter performance. Profit after tax fell to $18.3 million down from $30.8 million in the prior year six months period. Earnings per share were 70 cents compared to 117 cents in the prior year. For the June quarter, the company generated revenues of $140.5 million versus $148 million in 2014 resulting in aftertax profit hitting $12.5 million from $17 million in 2014. A fall in selling, distribution and administrative cost in the 2015 second quarter versus 2014 helped cushioning the fall off in revenues and decline in gross profit that fell by $8.6 million, in 2014 there was $5.4 million in other revenues with none being earned in 2015.
“Looking forward we expect the challenges of the regional economies to impact our growth prospects. In Trinidad and Tobago the uncertainty of the upcoming elections continues to affect the business environment. Regionally, recovery continues to be slow due to the depreciation of local currencies and shortage of US dollars across markets, which is cause for concern. While the recovery from the first half of the year remains a challenge, Unilever Caribbean is optimistic that the investment in our new IT systems and infrastructure will build the foundation for future growth. However, at this time the outlook for the rest of the year remains moderate” Pablo Garrido, Chairman of the company reported to shareholders.
The stock last traded on the at $67 placing the PE at over 30 times earnings.