Farsons profit surge
During a meeting held on September 26, the board of directors of Simonds Farsons Cisk plc approved the financial statements for the six-month period ended July 31, 2007. The directors declared a net interim dividend of Lm100,000 (0c3889 per share), an...
During a meeting held on September 26, the board of directors of Simonds Farsons Cisk plc approved the financial statements for the six-month period ended July 31, 2007. The directors declared a net interim dividend of Lm100,000 (0c3889 per share), an increase of 33 per cent over last year's interim dividend. The dividend will be paid on October 19, 2007.
During the first half of the year ended on July 31, 2007 the Farsons Group's turnover increased by 3.8 per cent to Lm14.5 million mainly as a result of a 4.7 per cent rise in the "brewing, production and sale of beer and branded beverages" to Lm8.9 million. The directors attribute this increase in sales of beers and branded beverages to new product launches (Cisk Excel and Kinnie Zest), an improvement in the number of tourism arrivals and a better economic environment.
The segmental information included in the interim report detailing the breakdown of the group's revenue from the different areas of activity, also reveals that revenue from "importation and sale of food and beverages" was unchanged at Lm3.9 million despite an increase in sales of Quintano Foods. Meanwhile, a 10.3 per cent rise was registered in the "operation of franchised food retailing" to Lm1.7 million.
Cost of sales during the six months to July 31, 2007 amounted to Lm10.7 million resulting in a gross profit of Lm3.8 million, an increase of 11.3 per cent from the gross profit of Lm3.4 million generated in the first half of last year. The gross profit margin improved to 26.2 per cent from 24.5 per cent in July 2006.
Operating expenses made up of selling and distribution costs and administrative expenses increased by only 1.6 per cent to Lm2.6 million. Group operating profit during the first half of the financial year increased by 38.4 per cent to Lm1.2 million resulting in an operating profit margin of 8.6 per cent (July 2006: 6.5 per cent).
The group recognised a profit of Lm0.46 million from the sale of two properties which the Directors considered to be surplus to the group's requirements. The construction of the logistics centre in Mriehel which is expected to be completed in the coming months will enable Farsons to centralise its distribution activities and transfer the operations of Wands Limited from Qormi to the logistics centre. Moreover, the group will also be able to vacate the various distribution depots located in Gudja, San Gwann and Tal-Balal. While the group has already secured the sale of the Gudja depot, it is also expected to pursue the disposal of the other two properties in due course.
Interest payable on the group's outstanding borrowings during the six months ended July 31, 2007 dropped by 14.2 per cent to Lm0.3 million.
The Farsons Group registered a profit before taxation of Lm1.4 million (July 2006: Lm0.59 million) during the first half of the year. After deducting the tax expense of Lm0.18 million, profit attributable to shareholders amounted to Lm1.2 million. During the first half of last year the group had generated a profit of Lm0.47 million which was negatively impacted by a loss of Lm64,000 related to the disposal of the Galleria Complex.
As at July 31, 2007 total assets of the Farsons Group amounted to Lm42.7 million with shareholders' funds of Lm16.8 million. Annualised return on equity climbed to 15.3 per cent with a similar improvement in the annualised return on assets of 7.1 per cent.
In the interim report, the directors confirmed that as announced during the company's 60th annual general meeting held on June 27, 2007 a valuation of all the group's properties has been commissioned.
This is expected to positively impact the group's balance sheet given the strong capital appreciation within the property market during recent years and given that a large part of this property is shown at cost in the company's books.
p Rizzo, Farrugia & Co. (Stockbrokers) Ltd are members of the Malta Stock Exchange and licensed to conduct investment services business by the Malta Financial Services Authority. This report contains public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily indicative of future results. Neither Rizzo, Farrugia & Co., nor any of its directors or employees accepts any liability for any loss or damage arising out of the use of all or any part of this report.
© 2007 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved.
During the first half of the year ended on July 31, 2007 the Farsons Group's turnover increased by 3.8 per cent to Lm14.5 million mainly as a result of a 4.7 per cent rise in the "brewing, production and sale of beer and branded beverages" to Lm8.9 million. The directors attribute this increase in sales of beers and branded beverages to new product launches (Cisk Excel and Kinnie Zest), an improvement in the number of tourism arrivals and a better economic environment.
The segmental information included in the interim report detailing the breakdown of the group's revenue from the different areas of activity, also reveals that revenue from "importation and sale of food and beverages" was unchanged at Lm3.9 million despite an increase in sales of Quintano Foods. Meanwhile, a 10.3 per cent rise was registered in the "operation of franchised food retailing" to Lm1.7 million.
Cost of sales during the six months to July 31, 2007 amounted to Lm10.7 million resulting in a gross profit of Lm3.8 million, an increase of 11.3 per cent from the gross profit of Lm3.4 million generated in the first half of last year. The gross profit margin improved to 26.2 per cent from 24.5 per cent in July 2006.
Operating expenses made up of selling and distribution costs and administrative expenses increased by only 1.6 per cent to Lm2.6 million. Group operating profit during the first half of the financial year increased by 38.4 per cent to Lm1.2 million resulting in an operating profit margin of 8.6 per cent (July 2006: 6.5 per cent).
The group recognised a profit of Lm0.46 million from the sale of two properties which the Directors considered to be surplus to the group's requirements. The construction of the logistics centre in Mriehel which is expected to be completed in the coming months will enable Farsons to centralise its distribution activities and transfer the operations of Wands Limited from Qormi to the logistics centre. Moreover, the group will also be able to vacate the various distribution depots located in Gudja, San Gwann and Tal-Balal. While the group has already secured the sale of the Gudja depot, it is also expected to pursue the disposal of the other two properties in due course.
Interest payable on the group's outstanding borrowings during the six months ended July 31, 2007 dropped by 14.2 per cent to Lm0.3 million.
The Farsons Group registered a profit before taxation of Lm1.4 million (July 2006: Lm0.59 million) during the first half of the year. After deducting the tax expense of Lm0.18 million, profit attributable to shareholders amounted to Lm1.2 million. During the first half of last year the group had generated a profit of Lm0.47 million which was negatively impacted by a loss of Lm64,000 related to the disposal of the Galleria Complex.
As at July 31, 2007 total assets of the Farsons Group amounted to Lm42.7 million with shareholders' funds of Lm16.8 million. Annualised return on equity climbed to 15.3 per cent with a similar improvement in the annualised return on assets of 7.1 per cent.
In the interim report, the directors confirmed that as announced during the company's 60th annual general meeting held on June 27, 2007 a valuation of all the group's properties has been commissioned.
This is expected to positively impact the group's balance sheet given the strong capital appreciation within the property market during recent years and given that a large part of this property is shown at cost in the company's books.
p Rizzo, Farrugia & Co. (Stockbrokers) Ltd are members of the Malta Stock Exchange and licensed to conduct investment services business by the Malta Financial Services Authority. This report contains public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily indicative of future results. Neither Rizzo, Farrugia & Co., nor any of its directors or employees accepts any liability for any loss or damage arising out of the use of all or any part of this report.
© 2007 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved.