Jamaica Producers Group Ltd (JP) European ‘Food & Drink’ Arm Drag Margins & Profits Down – Jun 2020 (Q2)

Jamaica Producers Group Ltd (JP) recently reported their June 2020 (Q2) results. Here are the highlights.

This is just a summary, but for more charts, ratios and other details visit JP’s page here

Year To Date (2020Q2)

  • Revenue was $9.51b. Declining by -6.29% or -638.47m YTD YoY.
    JP’s Food & Drink (“F&D”) Division is the largest contributor to the revenues of the Group. Closely followed by Logistics & Infrastructure. However Logistics is the main profit driver. (2020 Logistics YTD profit 10 times the profit that Food & Drink makes (before tax) while 2019 YTD was 3.6 times)
  • Cost Of Sales / Direct Expenses totaled -$6.70b. Up by 0.83% or -55.25m YTD YoY.
  • Gross Profit totaled $2.80b. Down by -19.80% or -693.73m YTD YoY.
  • Gross Profit Margin (YTD) totaled 29.52%. Declining by -4.98% from 34.50%.
    Management says ‘We incurred higher raw material costs, particularly in the global supply of fresh fruit for our European juice business. These challenges are likely to continue during the worst of the COVID-19 pandemic, but we do not believe them to be permanent in nature’
  • Sales, Marketing &/or Distribution Expenses of -$1.86b. Up by 1.72% or -31.48m YTD YoY.
  • Operating Profit totaled $1.30b. Declining by -28.75% or -527.48m YTD YoY.
    Management says ‘The Group operates internationally and many of the countries in which the Group operates had their most severe health effects and lock downs associated with the pandemic during the reporting period.’
  • Finance Costs totaled -$148.94m. Declining by -4.65% or 7.26m YTD YoY.
  • Income Tax was -$216.10m. Down by -36.72% or 125.37m YTD YoY.
  • Net Income (Profit) was $938.19m. Down by -30.14% or -404.83m YTD YoY.
    Logistics (while the second largest revenue driver) is what brings the brings the most profits to the group. Food and Drink hit hard YTD. In 2019 F&D was $438m (profit before tax), 2020 its $116m. Management says  A.L. Hoogesteger Fresh Specialist B.V. (“Hoogesteger”) is the largest contributor to the revenues and profits of the Division, and they are a market leader … in Europe…one of the first/hardest hit places this quarter.
  • Net Profit Margin (YTD) totaled 9.86%. Down by -3.36% from 13.22%.
  • Comprehensive Income of $1.25b. Decreasing by -17.21% or -261.41m YTD YoY.

Revenue (YTD)

Net Income (Profit) (YTD)

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