Date: June 20, 2018
Blue Power Group Limited (BPOW), for the year ended April 30, 2018, revenue increased by 8%, year over year, totaling $1.51 billion (2017: $1.40 billion) as sales from the Lumber division increased by 12% while sales from the soap division inched up by 0.2%. BPOW stated that “The overall increase in sales for this year, however, was not accompanied by any gains in net finance income which was almost $21 million in 2016/17 compared to almost zero in the year under review.” For the fourth quarter Revenue was up 3% to total $358.10 million relative to the $346.67 million booked in 2017.
Cost of Sales for the period showed an increase of 11%, moving from $1.07 billion to $1.18 billion. As such, Gross Profit amounted to $323.13 million, a small decrease of 1% on the $327.28 million recorded last year. For the fourth quarter, Cost of Sales increased by 1% amounting to $286.69 million (2017: $284.30 million), resulting in a 14% increase in Gross Profit to $71.41 million (2017: $62.38 million).
Administrative Expenses for the period saw a decrease of 3%, totaling $210.72 million relative to last year’s $216.92 million.
Other income for the year end totaled $3.45 million, a 58% reduction when compared to the $8.23 million recorded for the same period last year.
Finance Cost of $14.80 million was recorded for the year end compared to $4.32 million in the year prior, while Finance Income totalled $14.86 million relative to the $25.24 million in 2017. Consequently, Profit before taxation for the year end reflected a 17% decline year over year to $115.93 million versus $139.51 million booked for the prior year.
After taxation of $13.69 million (2017: $17.69 million), Net Profit for the year amounted to $102.24 million compared to $121.82 million, a 16% dip. Net Profit for the fourth quarter was down 37% to total $22.97 million in contrast to $16.71 million reported in the corresponding period last year.
Management noted, “In the previous period, overall profits before and after tax were bolstered by significant benefits due to changes in the exchange rate.”
Earnings per share for the period totaled $1.81 (2017: $2.16), while for the quarter the EPS was $0.41 (2017: $0.30).The number of shares used in this calculation was 56,499,000 shares. Notably, BPOW’s stock price closed the trading period on June 19, 2018 at a price of $30.00.
BPOW further advised, “Our efforts to improve our export performance have borne fruit. Over 21% of our soap sales went to export markets in the Caribbean, the USA and the UK. Most significant improvement has come from the Guyana market where we now have two distributors selling our products. The increase in export sales over the previous year was 34%, from $70 million to $94 million. We have also been successful in reducing a significant amount of over-90 day receivables which had been provided for. The diminution in these receivables resulted in a significant improvement in the results for the fourth quarter with net profit after tax increasing from $17 million to $23 million. The purchase of the two properties, 4 and 6 Victoria Avenue, the location of the Blue Power soap division was completed at the end of the financial year and is now reflected on our own balance sheet. We continue to prepare for the competitive pressures we will face as the factory in Dominica, which had been closed down, is reopened under new management and a new plant has been installed in Jamaica.”
Balance Sheet at a glance:
As at April 30, 2018, total assets amounted to $904.36 million, up $147.36 million from the balance of $757.00 million as at April 30, 2017. The largest contributor to the increase in assets were ‘Investment ‘and ‘Inventories’ which closed the period at $148.50 million (2017: nil) and $290.02 million (2017: $243.43 million) respectively.
Shareholders’ Equity increased by approximately 14% amounting to $762.74 million (2017: $671.23 million) with a book value per share of $13.50 (2017: $11.88).
Disclaimer:
Analyst Certification -This research report is for information purposes only and should not be construed as a recommendation. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.
