Par Value:
Closing Price: 1.34
Total Shares Issued: 161866804.00
Market Capitalization: 216,901,517
EPS: 0.4
PE: 3.350
Flame Tree Group reports H1 2021 Earnings versus H1 2020 Earnings
HY Revenue 1.630738167b versus 1.175761769b
HY Cost of Sales [1.084043738b] versus 0.699386039b]
HY Gross Profit 546.694429m versus 476.375730m
HY Selling and Distribution expenses [211.693148m] versus [131.612083m]
HY Administrative expenses [144.523872m] versus [80.049743m]
HY Other Operating Expenses [66.898673m] versus [152.500396m]
HY Operating Profit [Loss] 126.523681m versus 114.479710m
HY Finance Costs [59.536435m] versus [59.095947m]
HY Profit before Tax 66.987246m versus 55.383763m
HY Comprehensive Income 109.731149m versus 53.816926m
HY Net Cash at end of period [242.237321m]
Commentary
FTG Holdings (FTGH NSE) the diversified manufacturer and distributor of plastic tanks, cosmetics, snacks, spices and playground equipment
The group reported revenue in H1 2021 of Kes 1,630.7M and gross profit reached 546.6M, with gross margin at 34%,
Operating expenses were in up by 16% vs. LY which led to an increase in Profit Before Tax of 21% vs. LY, from 55.3M up to 66.9M.
Comment H1
The Groups priority has been to keep increasing sales in every business line, and mitigate the sharp rise in international raw materials prices and logistic costs, which have impacted the margins severely (34% vs 41% H1 2020).
The new machines purchased last year have enabled an increase in production and lower unit costs.
The group is still investing in strategic assets to be able to diversify our product portfolio and to cater for a higher demand of our products.
We have continued to innovate and launch new products and packaging formats to the market, in all 3 business lines plastics, cosmetics and snacks & spices.
Net debt increased 7% vs. Dec.2020, however Net Debt/Net Assets ratio has remained at 0.6, and Return on Equity ratios have shown improvement.
Working Capital improved by 18 days as a result of faster collections, lower stock and longer payment terms to creditors.
Impact of COVID19
The effects of the pandemic still remain, and we have gone through restricted access to markets, sharp increase in the prices of raw materials, fuel and logistic costs.
Availability of USD in Rwanda and Ethiopia has been very scarce, hence affecting the purchase of raw materials for our factories.
However we have gained new clients, and managed to increase sales across the business lines Plastics +33% Cosmetics +16% Snacks +4% (despite the loss of Tuskys) and Trade +93%
Conclusions
Market capitalisation is around $2m which means it is very undervalued
Flame Tree Group FY 2019 results through 31st December 2019 vs. 31st December 2018
Flame Tree Group Full Year Results through Dec 2020 versus Dec 2019
a diversified manufacturer and distributor of plastic tanks, cosmetics, snacks, spices and playground equipment
FY Revenue 2.910676573b versus 2.424753503b +20%
FY Cost of Sales [1.769160997b] versus [1.602069716b]
FY Gross Profit 1.141515576b versus 0.822683787b
FY Selling and distribution expenses [290.500234m] versus [305.048681m]
FY Administrative expenses [477.655526m] versus [302.703249m]
FY Other Operating Expenses [68.991742m] versus [57.485492m]
FY Operating Profit [Loss] 306.834179m versus 165.744117m
FY Finance Cost [158.420765m] versus [75.213959m]
FY Profit [Loss] before Taxation 148.413414m versus 90.530158m +64%
FY Profit [Loss] for the Year 71.180432m versus 44.936245m +67%
FY EPS 0.42 versus 0.25 +68%
FY Cash and Cash Equivalents [218.346914m] versus 66.419269m
Exchange differences on translation of Foreign Operations [42.020911m] versus [6.020710m]
FY Total comprehensive income [Loss] for the Year 33.159521m versus 233.440582m
No Dividend
Company Commentary
The Nairobi Securities Exchange (NSE) Listed firm confirmed that all profit ratios showed major improvements; sales increased by 20% and gross margin grew by 39% from 34 p.p. to 39 p.p.
According to Mr. Heril Bangera, CEO Flame Tree Group,
We are very satisfied with the results achieved this year, despite all challenges in the most difficult year amid the global pandemic, the company has reacted fast to preserve its cash, protect employment, seize every commercial opportunity, even launching new products designed to fight the Covid 19 and continue to show a remarkable growth for the third year in a row.
Our receivables have been kept under tight control, and despite the impairment of some receivables mainly related to Tuskys Supermarket the DSO ratio improved by 4 days, said Mr. Bangera.
Conclusions
Market Cap is < than $2m
Its a very inexpensive share
FY Revenue 2.424753503b vs. 2.488610130b -2.566%
FY Cost of sales [1.602069716b] vs. [1.727327066b] -7.252%
FY Gross profit 822.683787b vs. 761.283064m +8.065%
FY Other operating income 6.682401b vs. 15.164548m -55.934%
FY Selling and distribution costs [305.048681b] vs. [314.158970m] -2.900%
FY Administrative expenses [302.703249m] vs. [295.652238m] +2.385%
FY Other operating expenses [57.485492m] vs. [60.856701m] -5.540%
FY Operating profit 165.744117m vs. 107.318715m +54.441%
FY Finance expenses [75.213959m] vs. [65.171402m] +15.409%
FY Profit before tax 90.530158m vs. 42.147313m +114.795%
FY Current Tax [30.415764m] vs.
FY Deferred Tax [15.178149m] vs. [8.362241m] +81.508%
FY Profit for the year 44.936245m vs. 33.785071m +33.006%
EPS 0.26 vs. 0.19 +36.842%
FY Gain on revaluation 229.670444m vs. 202.755759m +13.274%
FY Exchange Differences on translation of foreign operations [6.020710m] vs. [12.847892m] -53.139%
FY Income tax relating to items that will not be reclassified [45.145397m] vs. [60.826728m] -25.780%
FY Total comprehensive income for the year 223.440582m vs. 162.866210m +37.193%
EPS (Total comprehensive income for the year) 1.26 vs. 0.91 +38.462%
Total Equity 1.052528634b vs. 813.034474m +29.457%
Cash and cash equivalents at 31st December 66.419269m vs. [101.548667m] +165.406%
Flame Tree Group Holdings (FTGH NSE) the diversified manufacturer and
distributor of plastic tanks, cosmetics, snacks, spices and playground equipment, has announced a 115% increase in pre tax profit up to KES90.5 million for the FY 2019 from KES42 million posted the previous year.
The Nairobi Securities Exchange (NSE) Listed firm confirmed that all profit ratios showed major improvements the gross margin grew by 8% from 31% to 34%, this was able to offset comfortably the slight decrease of sales (-2.6%) caused by the disruption of sales due to moving of the company in Ethiopia to its self owned new tailor made factory site.
Overall expenses remained stable, despite strong investments in marketing initiatives of over USD 1MM (including TV campaigns and launching of new products).
According to Mr. Heril Bangera, CEO Flame Tree Group, The significant investments done in fixed assets of industrial machinery, vehicles and new factory in Ethiopia, led to increased use of funding facilities which translated to a +15.4% increase in finance costs. However, our Net Debt/EBITDA ratio remained low, under x3.
Our working capital management has also improved significantly, especially in the area of accounts receivables with a new credit control team in place, which allowed reduction in the DSO ratio by 20.65 days, said Mr Bangera.
A revaluation of assets by an independent valuer increased the overall asset value by KES229.7 million.
Net assets of the company grew by 30% boosted by positive results and higher asset value.
Business Outlook
As a result of the Covid19 we are living the most unprecedented event in our lifetime.
FTG is financially strong and our Management is confident it will be able to weather this storm. Being a regional group, it is however subject to the measures taken by each government in each jurisdiction to fight the pandemic which is outside the control of the Company.
The Company has undertaken several key initiatives to preserve the financial sustainability of the company, preserve employment and be ready to resume operations as soon as allowed. This includes a moratorium of several months agreed with our main bankers.
Positive Short Term Effects of Covid 19
During the first Quarter of 2020 we have experienced:
increase in sales of hand washing stations
increase in sales of hand sanitizers
decrease of the price of plastic raw materials in the international market, following the drastic drop of fuel prices.
Looking ahead FTGH should continue to increase sales in markets outside Kenya, both through its companies in Rwanda, Ethiopia and Mozambique, and by increasing significantly the value of its exports to other African countries, especially in the cosmetics Division.
Dividend
The board of directors do not recommend the payment of a dividend for the year ended 31 Dec 2019.
Flame Tree Group HY 2019 results through 30th June2019 vs. 30th June 2018
HY Revenue 1.254949910bvs.1.265671964b -0.847%
HY Cost of sales [856.151845m] vs. [861.833396m] -0.659%
HY Gross profit [398.798065m] vs. [403.838568m] -1.248%
HY Other operating income 2.834978m vs. 4.894212m -42.075%
HY Selling and distribution costs [207.681819m] vs. [182.639627m] +13.711%
HY Administrative expenses [115.658006m] vs. [116.695930m] -0.889%
HY Other operating expenses [32.688054m] vs. [19.933230m] +63.988%
HY Operating profit after gain on disposal of Property, Plant and Equipment 45.605164m vs. 89.463993m -49.024%
HY Finance Costs [36.011003m] vs. [34.613987m] +4.036%
HY Profit before tax 9.594161m vs. 54.850006m -82.508%
HY Profit for the period 9.594161m vs. 39.917062m -75.965%
EPS 0.05 vs. 0.22 -77.273%
Shareholders Funds 1.352430754b vs. 853.683622m +58.423%
Cash and cash equivalents at end of period [106.691055m] vs. [189.814676m]-43.792%
PRESS RELEASE
H1 2019 reported revenue Kes 1,255M
Gross Profit reached 399M, with gross margin at 32%
EBITDA was 68.9M, 5.5% over sales and a decrease of -39% vs. LY
23rd August 2019, Nairobi Flame TREE Group Holdings (FTGH: NSE) the diversified manufacturer and distributor of plastic tanks, cosmetics, snacks, spices and playground equipment is pleased to announce its financial performance for HY2019.
The group reported revenue in H1 2019 of Kes 1,255M and gross profit reached 399M, with gross margin at 32% all in line with previous year.
By Business line
Plastics Sales in plastics was up by +13%, reporting a Gross Profit of 293.5 MM (+8% vs. LY), showing a slight reduction in margin by 1.4 p.p. which is mainly due to the negative impact of the business situation in Ethiopia and Mozambique. The division also posted a sharp increase in Selling & Distribution costs (+27% and +30MM vs. LY), mainly linked to transport costs and sales teams.
Snacks: Sales was down -15% vs. LY. Total Gross Profit was also down to 16MM (-32% vs. LY) caused by the drought experienced in the country resulting in scarcity of potatoes and price increases. This affected both production and margins.
Cosmetics: Reported a positive growth in sales +11% vs. LY. Despite the higher cost of sales due to 16MM paid in demurrage charges, gross profit moved up by 9% vs. LY. Margin for last 2 months improved and was above 30%. The division also reported an increase in distribution expenses and higher cost of transport. EBT remained the same level as LY, and EBITDA improved 4%. We have undertaken strong investments in marketing with advertising campaigns in mainstream and online media platforms, we have opened a new SuzieBeauty store in Sarit Center and launched a new product range in ZOE lotions which will have a positive impact on revenue in the second half of the year.
Highlights H1
The group has made significant improvements in production, staff & logistics and marketing
Inauguration of new factory in Ethiopia, now fully operative.
New store of Suzie Beauty in Sarit Center.
Distribution of cosmetics in Mozambique and considerable increase in exports to Rwanda.
Several new machines: blancher and oil filter in Chirag, PET machine & compressor and second injection moulding machine in Jojo, new HDPE pipe machine in Rwanda to meet demand of projects in agriculture, homogenizer machine in Flame Tree Africa.
Additional investment in 9 trucks to reduce logistic costs in Kenya
New media promotion with Bahati as Brand Ambassador for ZOE Mens range, several promos and marketing actions like launch of 5 new products on the Churchill Show Laugh Festival including our Zoe fragrance lotions & Mens Shampoo, merchandising actions and focus on product value.
Launch of new Chigs Corn Crunch range in the snacks line.
Revaluation of assets made by an independent company brought 216,2 million KES of additional value to the Trial Balance.
According to Mr. Heril Bangera, CEO Flame Tree Group, We have seen a very positive trend in the last 2 months both in sales and margin. Traditionally the second half of the year shows better performance than H1, and we are still targeting to push for final net growth in Sales and Profit vs LY.
Flame Tree Group FY 2018 results through 31st December 2018 vs. 31st December 2017
FY Revenue 2.488610130b vs. 2.425090214b +2.619%
FY Cost of sales [1.727327066b] vs. [1.626812792b] +6.179%
FY Gross profit 761.283064m vs. 798.277422m -4.634%
FY Other operating income 15.164548m vs. 18.315442m -17.203%
FY Selling and distribution costs [314.158975m] vs. [321.826823m] -2.383%
FY Administrative expenses [295.652238m] vs. [335.379894m] -11.846%
FY Other operating expenses [60.856701m] vs. [59.685127m] +1.963%
FY Operating profit before gain on disposal of Property, Plant and Equipment 105.779698m vs. 99.701020m +6.097%
FY Gain on disposal on PPE 1.539014m vs. 2.697049m -42.937%
FY Operating profit after gain on disposal of PPE 107.318712m vs. 102.398069m +4.805%
FY Finance costs [65.171401m] vs. [60.988214m] +6.859%
FY Profit before tax 42.147311m vs. 41.409855m +1.781%
FY Tax [8.362243m] vs. [1.655346m] +405.166%
FY Profit for the year 33.785068m vs. 39.754509m -15.016%
EPS 0.19 vs. 0.22 -13.636%
FY Gain on revaluation 202.755759m vs.
FY Total comprehensive income for the year 162.866207m vs. 10.144470m +1,505.468%
EPS (Total comprehensive income for the year) 0.91 vs. 0.06 +1,416.667%
Total Equity 813.034474m vs. 731.460183m +11.152%
Cash and cash equivalents at 31st December [279.042724m] vs. [252.215396m] +10.637%
April 25th 2019, Nairobi Flame TREE Group Holdings (FTGH NSE) the diversified manufacturer and distributor of plastic tanks, cosmetics, snacks, spices and playground equipment, is pleased to announce its financial performance for FY2018.
The group reported total sales for FY 2018 were up 2.62% to KES2.48 billion from KES2.42 (-5% sales decrease in FY 2017), and group expenses were down -6.45% to KES670 million from KES717 million posted the previous year.
The group has announced a 2% increase in pre tax profit to KES42.1 million for the FY 2018 from KES41.4 million posted the previous year. This includes the impact of the bad debt provision in line with IFRS9. The Nairobi Securities Exchange (NSE) Listed firm confirmed that the profit before tax improvement is largely attributable to improved performance in sales and reduction in expenses.
According to Mr. Heril Bangera, CEO Flame Tree Group, the Group performance was the result of a sales diversification strategy, improved sales in our main market Kenya by 16% and an effort to reduce costs and identify areas to increase efficiency and quality.
The results of FTGH show a positive evolution compared to FY 2017 as it outperformed its peer comparable companies in NSE. Our business lines contributed greatly to our overall performance with reported growth in all verticals, plastics sales grew by 5%, cosmetics by 23% and snacks & spices by 44%. We focused on reducing the dependence on conventional business so that we can enhance our revenue sources and in so doing pursue profitability to support the business, says Mr Bangera. The Group is in full compliance with the new IFRS9 all potential payment defaults have been properly classified and provided for. This gives a clear view looking ahead to the future.
Business Outlook
Looking ahead FTGH will continue to increase sales in markets within and outside Kenya, both through its companies in Kenya, Rwanda, Ethiopia and Mozambique, and by increasing significantly the value of its exports to other African countries, especially in the cosmetics division.
H1 2018 Results through June 30th 2018 versus 6 months through June 30th 2017
H1 2018 Revenue 1.265671964b versus 1.260489157b
H1 Gross Profit 403.838568m versus 432.045922m -6.5%
H1 Selling and Distribution costs [182.639627m] versus [176.051633m]
H1 Administrative Expenses [116.695930m] versus [114.672411m]
H1 Operating Profit after gain ion disposal of PPE 89.463993m versus 122.595569m
H1 Finance Costs [34.613987m] versus [43.733080m]
H1 Profit before Tax 54.850006m versus 78.862490m
H1 Profit After Tax 39.917062m versus 66.493600m -40.00%
H1 EPS 0.22 versus 0.41 -46.34%
Company Commentary
Gross Profit margins dropped slightly to 31.9% versus 34.3%
Finance cost savings -20.9%
Mr. Heril Bangera we have seen an improvement in the business environment compared to 2017, half year figures albeit low, is still higher than 2017 performance. We continue to invest in new ranges of products to strengthen the top line, ultimately with a positive bearing on shareholders earnings. Despite experiencing tight cash environment we are continuously taking requisite measures to improve the same.
Conclusions
Its an interesting mix of businesses. Earnings probably trough here.
Flame Tree Group FY 2017 results through 31st December 2017 vs. 31st December 2016
FY Revenue 2.425090214b vs. 2.544628524b -4.698%
FY Cost of sales [1.626812792b] vs. [1.640312183m] -0.823%
FY Gross profit 798.277422m vs. 904.316341m -11.726%
FY Other operating income 18.315442m vs. 5.412643m +238.383%
FY Selling and distribution costs [321.826823m] vs. [329.112443m] -2.214%
FY Administrative expenses [335.379894m] vs. [297.491883m] +12.736%
FY Other operating expenses [59.685127m] vs. [45.267509m] +31.850%
FY Operating profit before gain on disposal of Property, Plant and Equipment 99.701020m vs. 237.857149m -58.084%
FY Gain on disposal on PPE 2.697049m vs. 0.837365m +222.088%
FY Operating profit after gain on disposal of PPE 102.398069m vs. 238.694514m -57.101%
FY Profit before tax 41.409855m vs. 175.974893m -76.468%
FY Profit for the year 39.754509m vs. 144.980485m -72.579%
EPS 0.25 vs. 0.90 -72.222%
FY Total comprehensive income for the year 10.144470m vs. 137.244923m -92.608%
EPS (Total comprehensive income for the year) 0.06 vs. 0.85 -92.941%
Total Assets 1.680769788b vs. 1.521194765b +10.490%
Shareholders Funds 731.460183m vs. 719.166802m +1.709%
Cash and cash equivalents at 31st December [323.257037m] vs. [101.713064m] -217.813%
Company Commentary
FTG diversified Manufacturer and Distributor of plastic tanks, cosmetics and snacks.
Gross profit margins declined to 32.9% margin versus 35.5% attributed to rising polymer prices in the global markets, increase in fuel and input food prices following the negative impact of the prolonged drought.
Overall expenses rose by 45m largely impacted by a 37.8m increase in administrative expenses to 335.4m. Co. made significant provisions against receivables from Supermarkets in Kenya that have been extremely slow too pay.
conclusions
Buy on dips.
H1 Revenue 1.202089149b vs. 1.114323376b +7.876%
H1 Cost of sales [753.268442m] vs. [746.059485m] +0.966%
H1 Gross profit 448.820707m vs. 368.263891m +21.875%
H1 Selling and distribution costs [175.204317m] vs. [98.671692m] +77.563%
H1 Administrative expenses [123.335764m] vs. [124.586679m] -1.004%
H1 Operating profit before gain on disposal of property, plant and equipment 127.970077m vs. 95.790657m +33.593%
H1 Gain on disposal of property, plant and equipment 0.786620m vs.
H1 Finance costs [43.771777m] vs. [19.620598m] +123.091%
H1 Profit before tax 84.980920m vs. 76.170059m +11.567%
H1 Profit for the period 80.528312m vs. 81.211426m -0.841%
H1 Exchange differences on translation of foreign operations [9.814609m] vs. 36.877608m -126.614%
EPS 0.50 vs. 0.50
Shareholders funds 698.334070m vs. 525.875391m +32.795%
Cash and cash equivalents at the end of June 30th [105.677692m]
Company Commentary
diversified manufacturer and distributor of plastic tanks cosmetics and snacks
+34% EBITDA to 128.8m versus 95.79m
CEO Heril Bangera said FTGH delivered a strong performance in the first 6 months of 2016 in a very tough economic environment. The increase in total operating expenses is attributable to rigorous advertising and marketing campaigns geared to increase revenue in the plastics and FMCH divisions
In january 2016 the group acquired Suziebeauty line of colour cosmetic brand venturing into personal care prestige portfolio.
FTGH operates across two business verticals, manufacturing and trading, in six countries. Its strategy is to build a diversified portfolio of African manufactured brands for African consumers, covering plastics, cosmetics and food in multiple markets and verticals.
Conclusions
On a PE of 3.591 Thats seriously a price in disequilibrium.
FY Revenue 2.283151865b vs. 1.764847673b +29.368%
FY Cost of sales [1.476312127b] vs. [1.197755467b] +23.257%
FY Gross profit 806.839738m vs. 567.092206m +42.277%
FY Selling and distribution costs [260.515766m] vs. [150.530394m] +73.065%
FY Administrative expenses [244.278863m] vs. [219.906436m] +11.083%
FY Operating profit [loss] before gain on disposal of property, plant and equipment 259.016014m vs. 139.371325m +85.846%
FY Gain on disposal of property, plant and equipment 2.086323m vs. 61.338464m -96.599%
FY Profit [loss] before tax 198.387446m vs. 144.798997m +37.009%
FY Profit for the year 178.848086m vs. 153.126198m +16.798%
FY Exchange differences on translation of foreign operations 40.985924m vs. 7.027966m
EPS 1.10 vs. 0.95 +15.789%
Shareholders Funds 627.620367m vs. 407.786357m +53.909%
Cash and cash equivalents at the end of the year 13.684023m vs. 47.190220m -71.002%
From an accompanying hard copy release
Group Revenue for FY2015 +29%
FY EPS +37%
Manufacturing vertical 75% of Total Revenue
Heril Bangera we have made considerable progress on our strategic plans, to generate an 86% increase in our normalised operating profits. The Acquisitions made in foods, snacks and cosmetics capped off FY 2015 really well for us
acquisitions doubled the size of the Food Portfolio
Annual Net Sales for FY 2015 +29% to 2.28b
Conclusions
Strong Earnings. Good Headline growth and a very clearly defined strategy.
FTGH results: earnings per share increases 37% @coldtusker @kenyanwalstreet @alykhansatchu @BurbidgeCapital
https://twitter.com/FlameTreeGroup/status/725196973087834113 |
