RJR's profit continues to climb - JamaicaObserver.com

Saturday, November 21, 2009 2:29 PM

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RJR's profit continues to climb

Wednesday, November 04, 2009

On the heels of management shifts, Radio Jamaica Limited (RJR) made $46-million profit for the three months ending September 30, 2009 versus a $45-million loss it made in the comparative quarter last year.
The large media group's profitability was assisted by a 24 per cent jump in turnover at $497.9 million versus $401.5 million in the comparative quarter last year.

"Additional revenues were earned from rate increases, better-than-anticipated revenues from the World Athletics Championships as well as heightened sponsorships and advertising activity," the Gary Allen-led RJR group explained in its financials.

The gross profit margin of 70 per cent in the September quarter reflected an improvement of 21 per cent when compared to the prior year.

In addition to the revenues increasing by $96.3 million, direct costs were reduced by 27 per cent, or $55.2 million due mainly to reductions in the spending for broadcast rights and savings resulting from the restructuring exercise at the end of the last financial year.

RJR also improved its cash flow significantly at $81.2 million in cash and cash equivalents up to September 30 versus $5.8 million last September.

The RJR management changes include the transfer of Yvonne Wilks from the post of general manager - cable division to the role of special projects manager whilst Trevor Johnson, will manage Reggae Entertainment Television (RETV) and Jamaica News Network (JNN).

Monday, RJR agreed to fully acquire JNN and RETV from minority holders.

RJR said the changes would allow the company to "weather the economic downturn affecting sections of the industry and the strengthening of their management".

RJR stated that it would be issued the remaining 5,500,000 shares from JNN and RETV on December 1, 2009. RETV and JNN founder is businessman Kimani Robinson. On December 1, 2006, RJR through its subsidiary, Media Plus Limited, acquired 65 per cent of RETV and 80 per cent of JNN. Unissued shares represent those shares approved by the shareholders to be issued to the previous owners of RETV and JNN upon their attainment of certain landmarks in a 36 month period.

"In prior year, 5,500,000 shares were written back against goodwill as the subsidiaries were not expected to meet future profit targets," stated the company in its financials.