Limners and Bards closing in on $1-b revenue threshold
ADVERTISING company, Limners and Bards is on the cusp of breaking the $1-billion revenue threshold by the end of this year after revenues for the nine-month period ended July 31 came in at $942 million. For the period under review, Limners and Bards registered a 37 per cent increase in revenues, which moved from $686 million in 2020 to $942 million.
Revenues for the full 2020 financial year for Jamaica’s only listed advertising company came in at $912 million. Profits for the last three quarters are up 32 per cent from $108 million to $142 million for the period under review.
Revenues and profits rise in third quarter
Third quarter profits climbed 35 per cent from $21 million to $29 million and is attributed to a 50 per cent rise in revenues from $215 million to $323 million. The revenue growth was driven by media placement (up $142.4 million or 39.4 per cent) and production (up $115.9 million or 62.2 per cent).
There was less revenue coming from agency business, which declined by $2.4 million or 1.8 per cent during the period under review. The company enjoyed a big jump in finance income in the quarter and year-to-date periods.
This was evidenced by a rise in income of $5.5 million for the quarter, up from $1.4 million in 2020 and $20.5 million for the nine months from $3.6 million last year. Gross profit rose 25 per cent to $285 million for the nine months to July, from $227 million and $82 million up 35 per cent from $61 million.
The management team of Steven Gooden, chairman, and Kimala Bennett, CEO, reported that gross profit margin slipped to 30 per cent for the nine months to July, up from 33 per cent in 2020 and, for the latest quarter, 25 per cent from 28 per cent in 2020. Administration expenses increased $38.6 million or 32.4 per cent in comparison to the previous nine months period.
These increases are primarily attributable to staff costs (increased work volume), repairs and maintenance of production equipment, depreciation and amortisation charges, and lease interest. Even with this increase, administrative expenses as a percentage of revenue remains relatively flat at 16.7 per cent compared to 17.3 per cent in the previous period.
Administrative expenses rose a robust 44 per cent to $57 million in the quarter and increased by 32.4 per cent in the nine months to $157 million but the year-to-date amount remains steady at 15.3 per cent of sales revenue. Shareholders’ equity stood at $536 million, with longterm borrowings at $106 million and short-term at $3 million.
The company paid two dividends of 7.4 cents in January and 3.6 cents in August this year, amounting to $94 million. Net assets is valued at $0.57, with the stock selling at six times book value.
Current assets ended the period at $657 billion, including trade and other receivables of $184 million, cash and bank balances of $449 million. Current liabilities ended the period at $185 million. Net current assets ended the period at $472 million.
Net remittance inflows of US$250.3 million for Jamaica declined by 4.1 per cent or US$10.6 million in comparison to August of 2020, the first month of reduced flows for 2021.
However, for the January to August 2021 period, remittance inflows to Jamaica grew by 25.4 per cent. Overall inflows for the January to August 2021 period totalled US$2,300.6 million.
The Bank of Jamaica (BOJ), in its monthly remittance report, states that the deterioration in the month of August emanated from a decrease in total remittance inflows of 2.4 per cent or US$6.8 million.
At the same time, there was an increase of 20.0 per cent or US$3.7 million in outflows. The BOJ stated that the decrease in gross remittance inflows resulted from a reduction of 6.4 per cent in inflows via remittance companies partly offset by an increase in inflows via other remittances of 22.2 per cent for the month of August. Other remittances include commercial banks.
The largest source market of remittance flows to Jamaica for August 2021 was the USA, which accounted for 70.0 per cent of total flows up from 66.3 per cent recorded for August 2020.
Other source countries which contributed a notable share of remittances for the month were Canada at 11.8 per cent, followed by the UK and the Cayman Islands at 10.0 per cent and 4.9 per cent, respectively.
The eight-month improvement of 25.4 per cent for Jamaica was lower than that of Guatemala which registered a growth rate of 38.5 per cent. Similarly, El Salvador and Mexico registered growth of 34.8 per cent and 25.7 per cent, respectively, for the eight months.