Profit climbs 20% at Paramount

Reduced administrative, selling and distribution expenses overcame a fall in revenues for the Junior Market listed Paramount Trading, for the fiscal year ending May 2021, to deliver a 20 percent rise in after tax profit to $64 million from $53 million in 2020 after profit surged more than nine times in the final quarter versus the similar period in 2020.

Paramount Trading had expanded into Chlorine and bleach processing.

In the final quarter, revenues rose 15 percent to $421 million from $366 million in 2020 and netted a profit of $36 million versus just $4 million in 2020. Sales revenue slipped 5 percent for the year to $1.44 billion, from $1.52 billion. Other income slipped from $25 million to $23 million, but foreign exchange gains contributed $19 million in 2021 versus $10 million in 2020.
Improvement in profit margin in the year saw margins rise from 30.9 percent in 2020 to 31.6 percent in 2021, but gross profit slipped 3 percent to $454 million, from $468 million in 2020.
Administrative expenses fell 32 percent to $68 million in the quarter, up from $100 million in 2020, and slipped 3 percent for the year, to $355 million from $367 million, a fall of $27 million in staff costs accounted for the bulk of the decline as salaries and wages fell from $179 million to $152 million as the average number of workers employed fell from 91 to 70. Distribution and sales expenses dipped from $19 million to $11 million. Finance cost inched higher from $48 million to $49 million in 2021.
The operations delivered gross cash flow of $121 million, but after changes in working capital, net cash flow from operations ended at $135 million. The company increased fixed assets by $9 million, had a net $15 million repayment of loans and paid $62 million in dividends, ended with increased funds at the end of the year of $49 million, pushing cash and investments to $261 million at the end of the fiscal year.

Paramount lubricant factory.

At the end of May, net current assets stood at $472 million. Current assets ended the period at $836 million inclusive of trade and other receivables of $323 million, cash and bank balances of $91 million. Current liabilities closed the year with $364 million. Non-current Investments being held for more than a year stood at $170 million. Shareholders’ equity ended at $796 million with long term borrowings at $473 million, down from $492 million in 2020 and short term loans amounted to $47 million versus $43 million in 2020.
Earnings per share amount to 4.1 cents for the year. ICInsider.com forecasts 10 cents per share for the fiscal year ending May 2022 with a PE of 12.5 at the last traded stock price at $1.25 on the Junior Market of the Jamaica Stock Exchange. Net asset value is 52 cents per share, with the stock selling at 2.5 net book value.
The Company’s principal activity is the importation and distribution of chemicals, lubricants and other related products, provision of haulage services and blends lubricants.

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