Paramount trading profits cut in half

Paramount trading profits cut in half

BY DAVID ROSE
Observer business writer

Wednesday, January 20, 2021

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With certain activities related to their various chemical products seeing lower demand, Paramount Trading Limited's net profit for the past six months fell by 50 per cent to $19.7 million as the second-quarter net profit declined by 82 per cent to $4.5 million.

The company which specialises in a wide range of products such as lubricants, adhesives, sanitisers and bleach saw its revenue for the quarter ending November 30 falling by 25 per cent to $306.6 million as its new target divisions continue to feel the impact of declined business activities. Even with a 27 per cent drop in cost of sales, gross profit still underperformed the prior period by 20 per cent at $100 million.

Total expenses recorded a 9 per cent decline to $91 million which left operating profit 55 per cent lower at $16.8 million. Due to financing costs growing by 28 per cent to $11.6 million and taxes being slightly lower at $645,191, the earnings per share came out at $0.003 versus the 0.016 in the prior period.

Total assets less current liabilities rose by 8 per cent to $1.3 billion mainly due to growth in the company's investments and lower liabilities. Non-current liabilities increased by 14 per cent to $497.8 million due to the lease liability provision relating to a new accounting standard. Shareholders equity grew by 4 per cent to $814.1 million compared to the prior period.

In spite of these setbacks, Chairman Radcliff Knibbs highlighted Paramount's future and ability to navigate the COVID-19 environment.

“Over the last months, Paramount, like most companies, has experienced unprecedented challenges to our businesses as a result of the novel COVID-19 pandemic. We have adapted to the circumstances and will continue to be proactive in the measures taken to combat its impact on our operations. We have continued to pursue our growth strategy whilst maintaining the operational framework, which was developed to prioritise the safety of our staff, customers, and other stakeholders.

We will continue pivoting our operations to maximise on any possible gains we may derive during this period of crisis. We expect that our strategic objectives will be realised through strong income and cost containment,” Knibbs said.


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