Apr 2008 Financial News

RML Releases Year End Results

Apr 08, 2008

Readymix (West Indies) Limited
Results for the Year Ended December 31, 2007

Earnings Per Share
For the Year Ended December 31, 2007, Readymix (West Indies) Limited (RML) reported Earnings Per Share (EPS) of $3.16. This represented an increase of 145.0 per cent or $1.87 on the corresponding EPS in FY06. Q407 on Q406, the Group’s EPS, rose 34.4 per cent or 21 cents from 61 cents (Q406) to 82 cents (Q407).

Financials
For FY07, Revenue increased by 14.2 per cent or $36.7 million to $295.3 million. This growth was as a result of the buoyant market conditions that existed in the construction sector during the year. Operating Profit rose by 97.8 per cent or $27.3 million to $55.2 million, while Finance Costs fell 27.1% or $1.3 million to $3.6 million. Profit Before Taxation ended the period at $51.6 million, up a substantial 124.6 per cent or $28.6 million on FY06. Profit After Taxation increased 137.2 per cent or $22.2 million from $16.2 million (FY06) to $38.4 million (FY07)

Dividends
The Board of Directors has approved a final dividend of 20 cents per share. The final dividend will be paid on June 30, 2008 to all shareholders on the Register of Members at the close of business on June 13, 2008.

Recommendation
Given the current surge of activity in the construction sector, we anticipate that this trend will continue into fiscal 2008.

We have forecasted an EPS of $3.80 for FY08. At the current price of $7.55 and this forecasted EPS, RML is trading at a price to earnings multiple of 2 times. While we continue to recommend a BUY on this share, we remind clients that approximately 80 per cent of the issued share capital of this company is held by substantial interests. As such, acquiring this share will most likely by difficult.


Nancy Chen
WISE Equity Research Team