Jamaica Broilers Group (JBG)

For the six months ended October 31, 2017:-

• Revenues totaled $23.02 billion, a 13% increase on the $20.43 billion reported in 2016. Revenue for the second quarter amounted to $11.53 billion compared to $10.41 billion booked for the corresponding quarter of 2016. Total revenue was broken down as follows;
• • The Jamaica Operations contributed $16.04 billion, an 8% increase compared to $14.85 billion for the same period of 2016. JBG noted, “Jamaica Operations reported a segment result of $1.1 billion, which was $283.0 million or 21% below last year’s normalized segment result of $1.3 billion. This decrease was mainly attributed to higher distribution costs as a result of a rebalancing of the inventory in the poultry segment, as well as some third-party storage issues that took place in the first quarter.”

• • US Operations recorded an increase of 23% to total $5.95 billion relative to $4.85 billion last year. According to the company, “Our US Operations continued to grow steadily and reported a segment result of $613.0 million, which was a 20% increase over the prior year’s result of $559.0 million. Our presence in this market remains robust with a broad and diverse customer base.”
• • Other Caribbean Operations contributed $1.03 billion, an increase of 42% when compared to $725.14 million. Management highlighted, “In the other Caribbean Operations segment, Haiti Broilers SA continues to benefit from the increased production and sale of table eggs which increased to 31% of the market, compared to 19% of the market at the end of the second quarter last year. The segment result amounted to $265.0 million, which was 53% above the previous year’s normalised segment results of $172.0 million

• Cost of Sales grew by 14% to $17.39 billion from $15.22 billion in 2016. Gross profit for the first six months reflected an increase of 8% to close at $5.63 billion versus $5.20 billion booked for the corresponding period in 2016.

• Other income rose 95% from $72.33 million for the first six month of 2016 to $140.81 million in 2017. Distribution costs rose 31% to close at $859.05 million relative to $654.39 million recorded for the prior year’s comparable period, while administration and other expenses grew by 7% to $3.72 billion (2016: $3.47 billion). According to the company, “distribution and administrative cost of the Group, reflected an increase of 11% over the previous year due primarily to inflation and increased development costs associated with the improvement of the Group’s information systems and IT security. These expenses include one-off cost elements which are not expected to recur. Additionally, finance income decreased by $253.0 million or 95% from the prior year due to foreign exchange losses when compared to foreign exchange gains in the prior year.”

• Operating profit improved by 4%, totalling $1.20 billion relative to $1.15 billion last year.

• JBG reported finance income of $13.84 million (2016: $266.47 million) a decrease of 95%, while finance costs increased marginally to $310.53 million relative to $309.77 million in 2016.

• Profit before taxation decreased for the period amounting to $898.70 million (2016: $1.11 billion). Tax charges for the period totalled $240.26 million (2016: $269.27 million). As such, net profit amounted to $658.44 million (2016: $841.17 million). Net profit for the quarter amounted to $445.86 million relative to $439.11 million booked last year

• Net profit attributable to shareholders amounted to $633.47 million relative to $834.59 million booking for the comparable period in 2016. Net profit attributable to shareholders for the quarter totalled $435.78 million versus $434.57 million booked for the second quarter of 2016.

• Total comprehensive income for the first six months amounted to $649.72 million relative to a $27.24 million. Notably, JBG reported exchange differences on translating discontinued operations of $956.12 million for the first six months of 2016.

• Consequently, earnings per share totaled $0.53 relative to $0.70 booked for the first six months of 2017. EPS for the second quarter amounted to $0.36 versus $0.36

• The trailing twelve months EPS amounted to $1.69. The total shares used in our calculation amounted to 1,199,276,400 units.

Balance sheet at a glance:-

• Total assets amounted to $27.92 billion as at October 31, 2017 relative to $25.19 billion a year prior. The increase in total assets was due mainly an increase in ‘Biological Assets’ and ‘Property, Plant & Equipment’ which rose 22% and 10% respectively. ‘Biological Assets’ and ‘Property, Plant & Equipment’ as at October 31, 2017 amounted to $4.57 billion (2016: $3.75 billion) and $7.82 billion (2016: $7.12 billion) respectively.
• Shareholders equity amounted to $14.86 billion (2016: $1297 billion) with a book value per share of $12.39 (2016: $10.82).

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