Revenues up 85% as net profit swells to profit J$103.94 million

Durrant Pate/Contributor

Jamaican listed media and entertainment company, Main Event Entertainment Group Limited (MEEG) is making a major recovery having been hit by the pandemic which saw it racking up losses, particularly over the past one and a half years.

However, its fortunes are returning with revenues for the nine months ended July 31, 2022 recorded a total of J$1.09 billion compared to $592.73 million booked for the same period in July 31, 2021, representing an 85 per cent increase year over year. Revenue for the quarter improved by 147 per cent to close the quarter at J$601.53 million relative to J$243.35 million booked for the corresponding period in 2021.

The company reports that, “the improved performance this quarter is underpinned by increased activity in our core business. The entertainment industry has seen a strong return to outdoor events and lifestyle experiences after a two-year hiatus. The quarter is a historic one and reinforces our optimism for a sustainable shift following the pandemic”.

Big jump in direct expenses

Direct expenses for the nine months rose by 134 per cent year over year to J$582.92 million relative to the J$248.76 million recorded in the prior corresponding period. Gross profit for the period grew by 49 per cent to J$511.15 million (2021: J$343.98 million).

Gross profit for the quarter increased 95 per cent from J$152.95 million in 2021 to J$297.99 million in 2022. MEEG booked other income of J$257,000 for the nine months, significantly higher than the prior year’s corresponding period of J$49,000.

Total expenses rose by 19 per cent to J$383.97 million versus J$322.32 million recorded for 2021. Of this, administrative and general expenses grew by 34 per cent to J$283.57 million (2021: J$212.02 million), while depreciation expenses decreased seven per cent to J$86.25 million (2021: $92.95 million).

Selling and promotion expenses went up by 54 per cent to J$4.83 million relative to the J$3.14 million booked last year. Total expenses for the quarter amounted to J$155.71 million, 35 per cent higher relative to last year’s comparable quarter of J$115.48 million.

Consequently, operating profit for the period rose 487 per cent to J$127.44 million (2021: J$21.71 million). Operating profit for the quarter amounted to J$142.34 million versus a profit of J$37.49 million booked July 2021.

Finance cost year over year, contracted by 25 per cent to J$9.56 million (2021: J$12.68 million) at the end of July 2022.

Surge in profitability

MEEG recorded a profit before taxation of J$117.88 million relative to the J$9.02 million reported for last year’s corresponding period. Likewise, profit before tax for the quarter grew significantly to close at J$139.32 million relative to a profit of J$29.68 million booked twelve months earlier.

The company reported tax charge of J$13.94 million (2021 tax credit: J$147,000) during the period, resulting in net profit totaling J$103.94 million, eleven times more than the J$9.17 million reported a year prior. MEEG reported net profit of J$123.78 million for the third quarter versus a profit of J$28.68 million for the comparable period in 2021.

As at July 31, 2022, the company’s assets totalled J$987.25 million (2021: J$856.42 million), J$130.83 million more than its value a year ago. This growth in total assets was largely driven by a 169 per cent increase in ‘Receivables’ which amounted to J$404.37 million (2021: J$150.18 million).

Money due from related companies’ also contributed to the upward movement with a 73 per cent increase from J$25.75 million booked as a July 31, 2021 to J$44.63 million for the period under review. Equity attributable to stockholders of the company amounted to J$653.69 million (2021: J$542.78 million).

This translated to a book value per share of J$2.18 relative to J$1.81 for the corresponding period in 2021.