RADIO JAMAICA (RJR) has improved its first quarter net profit position by a significant 43 per cent, gaining $11.3 million more than the $26.3 million it earned during the same period a year ago.
In its unaudited results for the quarter to June 30, published just over a week ago, the media conglomerate attributed the positive returns to increased sales and cost management initiatives.
The report, signed by Lester Spaulding, the company's chairman and managing director, and Hector Dietrich, financial director, said aggressive marketing strategies and consumer confidence have yielded group revenues of $238.7 million, a marginal $1.6 million over the earnings for the same period in 2002.
However, the directors said the revenue intake representing the sale of airtime, programme material and the rental of studios and equipment was especially noteworthy in view of the fact that last year's revenue included about $31 million from promotions associated with World Cup Football.
Gross profit and operating profit margins increased by nine and six per cent respectively, indicating what the directors said was the "level of savings, which has served group synergies to maximise efficiency."
The report also said that all areas of expenditure, except administrative costs, reflected increases of less than five per cent or a reduction when compared with the same period last year.
ADMINISTRATIVE EXPENSES
It said that while the report reflected a 20 per cent increase in administrative expenses, or $8.5 million more than the $43.3 million recorded last year, that was partly due to increased insurance associated with the company's new sport, news and production centre, as well as investment in staff training, increased costs relating to enhancement of technology and Internet facilities within the group, and vacation leave, which was not accrued in the first quarter last year.
Improved liquidity from operational activities increased by $27 million or 116 per cent over last year due to cost containment measures and improved collections, the directors said. The increased liquidity facilitated an increase in the level of investment, which, in turn, generated additional finance income.
The directors said a $14.2 million increase in net fixed assets from $269.6 million to $283.8 million was due to the cost of the new complex being constructed to relocate Television Jamaica from South Odeon Avenue in Half Way Tree, St. Andrew, as well as the merging of its radio news and sport departments.
The company also said an increase in its cash/deposits from $327 million to $609.3 million, and its long-term loan from $502.5 million to $785.9 million, was due to a $248 million loan to be used to equip the facility.
