Express Catering Limited’s Earnings Surge for 9M 2025

• Express Catering Limited (ECL) delivered a 54.2% surge in net earnings for the 9 months ended February 2025 (9M 2025), rising from US$2.09Mn in 9M 2024 to US$3.22Mn. Improved cost management, which compensated for marginal revenue growth, drove the buoyancy in earnings.
• Total revenue grew by 1.1% to US$18.89Mn, on higher average spend per passenger, which rose from US$9.53 to US$10.49, and compensated for a decline in total passenger volumes from 1.96Mn to 1.80Mn.
• Notwithstanding the marginal revenue growth, gross profit improved by 8.6%, driven by lower cost of sales (-13.9%) to US$5.31Mn.
• Similarly, Administrative and Promotional expenses declined by US$0.67Mn or 10.7% to US$5.58Mn, which outweighed a US$0.61Mn (27.7%) increase in depreciation expenses to US$2.82Mn.
• The lower administrative and professional expense reflects tighter cost management, notably in salaries, wages, and lease obligations under IFRS 16, as well as supply chain efficiencies and improved menu pricing. With the improved cost containment, operating profit rose by 26.7% to US$5.10Mn.
• With improved earnings, ECL’s profit margins improved from 11.2% to 17.0%.
• ECL’s management remains optimistic for the rest of its 2025 financial year. The winter season (Dec–May) remains a peak period for passenger traffic and revenue generation. Moreover, with the summer season approaching, the company is actively reviewing cost categories to further drive future savings and margin expansion.
• ECL’s stock price has decreased by 4.1% year-to-date. The stock price closed Tuesday’s trading session at $2.89 and currently trades at a P/E of 11.4x, below the Junior Market Other Average of 16.3x.

(Sources: JSE and NCBCM Research)