Caribbean Producers Reports Higher Net Loss

• Losses deepened at Caribbean Producers (Jamaica) Limited’s for the financial year ended June 30, 2020. The company’s audited net loss increased by 248.0% (or US$2.90Mn) year over year to US$4.07Mn (EPS: -US0.37¢). 
• Lower revenues and higher expenses drove the deterioration in the company’s performance. There was a 16.3% (or US$17.92Mn) drop in revenues, a 43.3% (or US$0.73Mn) increase in finance costs, and 75.8% (or US$1.87Mn) rise in depreciation and amortization expenses. However, the overall impact on the bottom-line was moderated by lower direct costs (-14.9%) and administrative expenses (-15.7%).
• As one of the largest suppliers of food and beverage to the Hospitality sector, CPJ was severely impacted by the near cession of activities in the tourism and hospitality sector due to the global pandemic. Group sales plummeted beginning in March 2020 and continued to be adversely affected until the end of the fiscal year June 2020, typically the Group’s most profitable period.
• The slowdown in the sales activity due to the ongoing pandemic has however assisted the company in smooth implementation of new IT initiatives to improve growth prospects and achieve operational efficiencies.
• The company’s stock price has declined by 55.4% since the start of the year, closing Wednesday’s trading session at $2.32. At this price, the stock currently trades at a P/B of 1.0x, which is below the Junior Market Distribution Sector Average of 2.9x.

(Source: CPJ Financials)