LOCAL bakery outfit Honey Bun put in a creditable performance for the financial year ended September 30, 2011 which saw revenues up by 25 per cent, producing a 61 per cent rise in net profits.
The company — founded in 1982 by husband and wife team Herbert and Michelle Chong, and which listed on the Junior Jamaica Stock Exchange earlier this year — has been one of the stars on that newly formed bourse.
Gross revenues for the year under review came to $560.8 million, $12.3 million more than the $448.5 million posted for the prior year. This generated a net profit of $27.6 million, a 61 per cent increase on the $17.1 million recorded for the financial year ended September 2010.
Like most listed companies, Honey Bun saw an increase in its operating expenses. Administrative and other expenses came to $97.2 million, a notable jump on the $78.7 million registered for the previous year. Selling and distribution cost, a significant line item for a baked product business, came in at $99.8 million, up on the $67.4 million posted for 2010.
Honey Bun’s assets are made up primarily of property, plant and equipment. The company has increased its output in keeping with its stated ambition to ramp up production in order to grow revenues.
For the year ended September 30, 2011 its assets grew to $170 million from $159 million for 2010. Equity and liabilities moved to $210 million for 2011, a significant increase on the $136 million posted for 2010.
Speaking with Caribbean Business Report on this year’s financial results, Honey Bun’s Chief Marketing Officer Krystal Chong said: “This year has been a very difficult year for us, costs of raw materials increased significantly. Our team had to work extra hard to cut costs, create more efficiencies, and drive sales in order to focus on two of our priorities. One, keeping the prices down for our customers while maintaining our reputation for superior quality; and two, increasing profits for our shareholders. This is illustrated in part in the 25 per cent increase in revenues and 60 per cent increase in net profits.”
The board of directors of Honey Bun has declared an interim dividend of $0.07 per stock unit payable on January 6, 2012 to stockholders on record as at December 20, 2011. Honey Bun’s earnings per stock unit increased to $0.34 for the year under review. For the previous year it recorded earnings per stock unit of $0.23.