Date: August 15, 2019
K.L.E Group Limited (KLE), for the six months ended June 30, 2019, the company recorded a total revenue of $101.87 million (2018: $106.60 million), representing a 4% decrease in revenue. For the second quarter revenues decreased 10% to total $52.15 million (2018: $58.25 million).
Cost of sales went down by 18% to $29.36 million compared to the $35.89 million reported in 2018; as a result, Gross profit was up 3% to total $72.51 million relative to $70.71 million in 2018. While gross profit for the quarter decreased by 7% to total $36.78 million compared to $39.34 million in 2018.
Other operating income declined by 35% to $10.36 million relative to $15.86 million. In addition, Administrative and Other Expenses decreased by 2% from $74.42 million in the first half of 2018 to $72.69 million for the same period of 2019. Management noted, “This is in line with management’s drive to reduce expenses and increase profitability. The company is getting more efficient operationally and further increase in profitability is expected as a result.”
Consequently, profit from operation amounted to $10.18 million in contrast to the $12.14 million for the same period last year, this represents a 16% reduction. For the quarter, KLE booked $4.47 million, down 51% compared to the $9.13 million reported for the second quarter of 2018.
Finance and depreciation costs increased to $10.53 million when compared to $8.27 million for the same period of 2018.
Following taxation of $520,000 (2018:$827,000), a net loss from operations for the period amounted to $871,000 compared to net profit of $3.05 million for the comparable period in 2018. Net loss from operations for the quarter amounted to $1.07 million versus a net profit of $5.05 million for the corresponding quarter of 2018.
Net Profit for the Period being total comprehensive income amounted to $632,000 relative to $3.09 million last year. Moreover, for the quarter, net Profit for the period being total comprehensive income totalled $299,000 (2018: $5.08 million).
Loss per share (LPS) amounted to $0.01 for the six months relative to 2018’s earnings per share (EPS) of $0.03 while LPS for the quarter totalled $ 0.011 this compares to EPS of $0.051 in 2018. The twelve-month trailing loss per share (LPS) amounted to $0.17. The number of shares used in our calculations is 100,000,000. KLE’s stock last traded on August 15, 2019 at $2.30.
Management noted, “KLE’s recent efforts to refinance the high cost debt and reduce payables carrying from previous years has improved the company’s financial position and will enable us to capitalize on growth opportunities ahead.”
Balance Sheet Highlights:
The company, as at June 30, 2019, recorded total assets of $219.27 million, an increase of 2% when compared to $214.30 million in 2018. This was due to an increase in Related Parties which was $65.22 million (2018: $43.95 million) but was offset by a decline in KLE’s Property, Plant & Equipment which closed at $24.16 million (2018: $38.77 million).
Total Stockholders’ Equity as at June 30, 2019 was $114.81 million, up from $142.86 million last year. This resulted in a book value of $1.15 (2018: $1.43).
Analyst Certification -This research report is for information purposes only and should not be construed as a recommendation. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.