Higher Revenues Bolster JP’s Bottom-Line

• Strong revenue growth supported a 75.7% year over year increase in Jamaica Producers Group Limited’s net profit attributable to shareholders to $609.58Mn (EPS: $0.54) for the 26 weeks ending July 3, 2021.
• Revenue which grew by 19.8%($1.89Bn) outweighed the increase in cost of sales (19.3% or $1.31Bn), rise in selling and admin expenses (9.0% or $160.00Mn) and higher tax expenses (47.8% or $103.22Mn). 
• Both of the company’s business segments – Logistics & Infrastructure (“L&I”) and Food & Drink (“F&D”) generated improved second quarter and year- to-date revenues and profits relative to 2020. The L&I division benefitted from the spike in overall demand for international shipping as the global economy recovers, and from the growing volumes of bulk and breakbulk cargo and automotive shipments to Jamaica and the region.
• The F&D Division benefitted from strong supermarket sales and improved consumer confidence arising from wage and GDP growth and advancing vaccination programmes in the US and European markets. This offset weak revenues from the company’s tropical foods business in Jamaica (due to school closures and curfews) and travel retail across the Caribbean.
• While inflation, supply chain shocks and economic uncertainty related to the uneven management of the COVID-19 pandemic will continue to present general challenges in the short term, the Group has decided to maintain an aggressive investment programme. With shareholders’ equity of $16.9Bn and net cash and investments of $10.1Bn, the JP Group believes it has the balance sheet strength to support its strategy.
• JPG’s stock price has appreciated by 5.0% since the start of the year and closed Tuesday’s trading session at a price of $22.0 per share. At this price, the stock trades at a P/E ratio of 10.2x earnings which is below the Main Market Sector average of 16.4x.

Source: (JPG Financials)