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Caribbean Cement Posting Improved EPS Of JA$2.53 For June 2023 Quarter

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Parris A. Lyew-Ayee Chairman for Caribbean Cement Company Limited (CCCL) has released the following  Interim Financial Report For The Six Months Ended June 30, 2023

Financial Performance
During the first half of the year, the Group realised revenue of $14.3 billion, representing a 5.6% increase when compared with the corresponding period in 2022. Revenue for the quarter increased by 11.5% to $7.5 billion over the same quarter last year.

Due to the impact of the high cost experienced from the scheduled annual maintenance exercise in the first quarter of 2023, the Group’s “Operating earnings before other income and expenses” was $3.6 billion, or 24.3% lower than the $4.8 billion reported for the same six-month period in 2022.

For the second quarter, the Group started to realise the benefits from its first quarter investment in maintenance efforts, as evidenced by the operational efficiencies and operative cost containment experienced in the second quarter. The “Operating earnings before other income and expenses” for the quarter was $3.0 billion, or 34.0% higher than the $2.2 billion reported for the corresponding quarter in 2022.

For the first half of the year, the Group recorded “Earnings before taxation” of $3.1 billion, which was lower than the $4.0 billion reported in 2022. The “Earnings before taxation” for the quarter was $2.9 billion representing an improvement of 56.4% over the $1.9 billion achieved in the second quarter last year. Also contributing to the Group’s positive “Earnings before taxation” was the effect of the decision to implement a debt and foreign exposure reduction initiative.

The overall “Consolidated net income” of $2.4 billion for the second quarter was higher than the corresponding period in 2022 by $0.6 billion.

“Earnings per share” for the quarter was $2.53, an increase of $0.82 when compared to the $1.71 for the corresponding period in 2022.

In relation to the cash flows, “Net cash provided by operating activities” was $3.3 billion for the six-month period and $1.1 billion for the quarter. The cashflow generation during the quarter and the available cash at the beginning of the period have allowed the Group to invest $2.0 billion during the first half of the year and $0.8 billion during the second quarter.

Outlook
Caribbean Cement Company Limited continues the implementation of the requisite business strategies to ensure sustainability of its operations. The Company remains optimistic about its financial position, buoyed by the large number of real estate developments slated to come on stream especially in the parishes of Trelawny and St. James. Furthermore, recent pronouncements about the new high-end tourism developments in the eastern part of the island, which feature premium villas, augur well for the Company. The Company will continue to carry out its flagship concrete road solution programme, with several communities slated to benefit from the intervention in short order.

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Higher Operating Costs And Margin Pressures Impacted Main Event’s Overall Q1 Profitability.

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Entering 2025 with a strategic focus on expanding revenue streams, strengthening client relationships, and maintaining financial discipline, the Company achieved revenue growth.
However, higher operating costs and margin pressures impacted overall profitability.

The Company reported revenues of $585.03M, representing a 3% or $17.28M increase over the $567.75M recorded in Q1 2024. This growth was primarily driven by a significant increase in revenue contribution from a previously underperforming segment, reflecting the success of targeted expansion efforts. While revenue remains below prior peak levels, the Company continues to recalibrate and drive demand through expanded service offerings and strengthened client engagements.

Gross profit for the quarter stood at $301.67M, reflecting a 4% decline from $315.82M in Q1 2024. This decline resulted from higher direct costs associated with event execution, infrastructure upgrades, additional non-recurring costs incurred during the period, and increased labour costs related to service delivery. Consequently, the gross margin contracted to 51.56% from 55.63% in the prior year. The Company remains focused on managing costs effectively to support long-term profitability.

Operating expenses increased to $218.72M, up 7.5% from $206.35M in Q1 2024. This rise was attributed to planned administrative enhancements, a significant one-off expenditure for the Company’s 20th Anniversary celebration, higher personnel costs, increased security and fuel expenses, and a 51% increase in amortisation expenses to $11.36M due to renegotiated lease agreements and the addition of a new lease.

Operating profit stood at $87.48M, a 24% decline from $115.28M in Q1 2024. Increased finance costs, stemming from renegotiated lease agreements and new lease additions, also impacted results.
Net profit for the quarter amounted to $73.67M, a 27% decrease from $100.25M in Q1 2024, influenced by lower gross margins, increased operational costs, and higher impairment charges. As a result, earnings per share (EPS) fell from $0.33 in Q1 2024 to $0.25 in Q1 2025.

Total assets grew by 6.4%, reaching $1,306.01M, up from $1,227.37M in Q1 2024. This increase was primarily driven by a 53% rise in receivables, reflecting expanded customer engagements, with several balances stemming from events executed near the period’s end. Short-term deposits increased to $250.24M from $236.50M, while cash and bank balances declined by 30% to $131.74M from $188.91M due to timing differences in collections and reinvestments.

Shareholders’ equity strengthened to $956.17M, reflecting a 5% increase over $912.66M in Q1 2024. This growth was primarily supported by retained earnings, demonstrating the Company’s ability to generate and reinvest profits efficiently.

Payables increased by 47%, rising to $229.58M from $156.38M in Q1 2024, mainly due to the timing of event executions towards the end of the quarter, resulting in higher accrued expenses related to supplier payments.

While the macroeconomic environment remains uncertain, the Company remains optimistic about the upcoming quarters. The focus will be on enhancing operational efficiencies to manage cost structures effectively and strengthening revenue streams through deeper market penetration and strategic partnerships. Additionally, the Company intends to use owned-events as a driver of revenue growth.
Our continued success is a testament to the dedication, creativity, and resilience of our exceptional team. Their ability to adapt and innovate in a dynamic industry ensures that we consistently exceed expectations and deliver outstanding experiences. Their dedication was especially evident during the holiday period, where they worked tirelessly to execute high-quality events, ensuring continued excellence in service delivery. We also recognise and appreciate the unwavering guidance of our Board; whose strategic leadership continues to drive our company’s growth and long-term vision.

Solomon Sharpe Chief Executive Officer

For More Information on Main Event Entertainment Group Limited (MEEG) Unaudited Results, Q1 – Three Months Ended January 31, 2025 (Revised) Click Here

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