Businessuite Markets
Wisynco Q1 Results Impacted By Reduction In Remittances And Softening Visitor Arrivals
Revenues for the quarter of $14.2 billion represent an increase of 7.2% above the $13.3 billion achieved in the corresponding quarter of the previous year however this fell slightly below our expectations.
The slowdown observed in the first quarter, driven by a reduction in remittances and softening of visitor arrivals, continued throughout the second quarter and was in fact compounded upon by the cool temperatures and significantly more rain than expected, making Q2 one of the rainiest quarters in some time both of which typically impacts fast moving consumer goods consumption adversely.
Gross Profit of $4.7b was 6% greater than the $4.4b of the prior year’s quarter whilst Gross Margin at 32.9% were 40 basis points below the 33.3% for the same quarter last year. The lower Gross Margin when compared to the prior year is attributed primarily to the lower absorption of fixed costs related to lower production volumes. Selling, Distribution & Administrative expenses (SD&A) for the quarter totaled $3.5 billion or 13.5% more than the $3.1 billion for the corresponding quarter of the prior year.
Our SD&A expense to sales ratio was 24.8% for the quarter, or 140 bps greater, when compared to 23.4% in the prior year. The greater SD&A expenses to sales ratios are essentially the result of our expanded Marketing and Sales departments, these increase costs align with our expectations of rolling out the capital expansion. Profit before Taxation for the quarter was $1.2 billion or 18.6% lower than the $1.5 billion of the comparative quarter for the prior year.
For the quarter, after provision for taxes, Wisynco recorded Net Profits Attributable to Stockholders of $991 million ($1.2 billion for the comparable quarter of the prior year), or 26c per stock unit for the quarter compared to 32c per share for fiscal 2024.
On a year to date basis through half the financial year, the business has earned $2.5b in Net Profit after Taxes, a 10.2% reduction year over year. Due to greater non-cash related expenses vs last year, primarily depreciation stemming from the various plant expansions, our EBITDA of $3.9 YTD is down only 4.2% year on year. From a balance sheet perspective, the business ended the quarter with $8.0 billion of cash and investment securities when compared to $11.5 billion in the previous year, the reduction is primarily due to investing an additional $2 billion in plant and equipment. Our working capital ratio remains strong at 2.39.
As we enter the second half of our financial year, we, like other business, are closely monitoring global challenges, including potential tariff regimes and economic disruptions stemming from recent policy changes. Wisynco remains committed to strategic planning to mitigate risks to our operations. Our recent investments in plant and equipment capacity, along with new production initiatives, will enhance our ability to diversify and navigate these challenges effectively.
Andrew Mahfood Chief Executive Officer Wisynco Group Limited – Unaudited financial results for the second quarter ended December 31, 2024, which have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting.
Businessuite Markets
Higher Operating Costs And Margin Pressures Impacted Main Event’s Overall Q1 Profitability.
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
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