Consumer confidence might be down, but annual profit at the pharmacy chain Fontana surpassed the $600 million mark for the first time.
“Cash balances continue to grow as revenues increased across all stores,” said Fontana in its financial results posted this week to the Jamaica Stock Exchange (JSE).
The company operates six stores across the island. A seventh location is to open in Portmore next year.
“We continue to experience strong revenue growth in key departments due to increased demand and significant inventory levels,” said Fontana, led by CEO Anne Chang.
Profit before tax increased by 14 per cent year-over-year, moving from $541 million to $616 million.
Revenues for the past year totalled $6.3 billion, a 23 per cent increase over the $5.3 billion of the previous year.
“This compares quite favourably with the 11 per cent growth average over the past four quarters reported by Statin for the Wholesale & Retail trade sector,” said the company.
Gross profit was $2.3 billion, or 16 per cent higher than the $1.9 billion recorded in the prior year, and gross margins moved to 35.6 per cent from 37.8 per cent.
Meanwhile, capital grew to $2.16 billion or 20 per cent over last year, enabling Fontana to make two dividend payments totalling $250 million during the year.
Global supply-chain challenges resulting in higher-than-normal distribution, shipping and freight charges continued to impact the cost of goods, Fontana stated.
Operating expenses grew by 15 per cent, directly attributable to the war in Ukraine, inflation, expanded operating hours and increased staff costs to reduce staff resignations.
These negative externalities have also affected consumption patterns.
In the June quarter, consumer confidence fell by one percentage point, and business confidence declined by 7.6 percentage points relative to the April quarter, data stated.
The level of confidence still trails 2019 levels when the economy was at its most confident in five years.