Higher 3M Profits but Lower Full-Year for Mailpac

• For the quarter ended December 31, 2024, Mailpac has noted record-breaking revenue growth which has led to a 23.8% increase in earnings for the company.
• Revenues increased by 78.7% to J$839.42Mn, driven by the acquisition of MyCart Express, the increased demand for the logistics and e-commerce solutions offered by the Group, and the enhancement of our customer experience and store locations.
• Costs of Goods also rose by 65.3%, resulting in gross profits of J$324.35Mn (+94.1%). This resulted in gross profit margins moving from 46.4% to 50.4%.  The improvement is attributed to increased operational efficiencies and negotiated cost reductions achieved through economies of scale.
• Meanwhile, operating expenses doubled (+108.2%) resulting in operating profits totalling J$120.11Mn, a 65.8% increase year-on-year. Financing costs also rose by 167.6%, coinciding with higher lease liability payments.
• Against that background, Mailpac recorded a 23.8% increase in net profits to J$56.94Mn. However, the gain was not enough to offset previous quarters, with net profits falling by 2.7% to J$253.15Mn for the year ended December 31, 2024.
• Mailpac’s stock price has declined by 3.4% since the start of the year. The stock closed Tuesday’s trading session at $2.60, with a P/E ratio of 86.67x, above the Junior Market Distribution Sector average of 30.07x

(Sources: JSE and NCBCM Research