Lasco affiliates still feeling iCool bump
Published:Thursday | February 4, 2016 | 12:00 AMSteven Jackson
The Lasco Affiliated Companies involved in manufacturing and distribution, made significantly higher net profit in the December 2015 quarter when compared with the year-earlier levels.
Net profits, however, fell at Lasco Financial, which operates remittance and cambio services.
Lasco Manufacturing reported comprehensive income of $232.3 million on revenues of $1.7 billion, or 46.7 per cent higher profit than a year earlier. The company credited its growth to new business from its iCool beverages.
"Comparisons with data for prior years have to be viewed against the background that significant expansion, and the successful introduction of many new products into our manufacturing process, has been achieved in keeping with our announced development plans," said Lasco Manufacturing Managing Director Robert Parkins in his statement appended to the financial report.
Lasco Distributors earned $212 million net profit over three months to December 2015 or 10 per cent more than year earlier levels due to new business lines, which includes iCool. Its net profit over nine months climbed to $591.9 million or 50 per cent higher than year-earlier levels.
"This growth was driven mainly by additional inventory arising from our new business lines, and capital expenditure relating to our warehouse expansion," said Managing Director Peter Chin in the preface to the financial report.
The business remains highly liquid, with most of its profit fuelling the rise of its cash holdings to $848 million from $300 million a year earlier.
Chin explained that new business helped to drive revenue 36 per cent higher to $10.9 billion at Lasco Distributors. Operating expenses totalled $1.2 billion over nine months or 11 per cent higher year-on-year, and reflects what Chin called inflationary increases as well as costs related to the company's growth.
"Management remains committed to containing operating costs in spite of the challenging economic environment," he said.
Lasco Financial Services earned less profit at $43.9 million compared to $69 million a year earlier due to increased staff costs associated with the growth of its loans and telecoms division.
"We also launched our telecoms division with the distribution deal for Huawei smartphones and wearable devices, rolling out eleven locations islandwide through our agent network. This investment impacted our expenses, mainly due to a more-than-50 per cent increase in staff complement, and the aggressive marketing support to launch the telecoms business," said Managing Director Jacinth Hall-Tracey in her statement to shareholders.