Carreras Limited's profits dropped dramatically to $577 million in the last quarter to September 30, relative to the $985 million it netted in the comparative 2005 period, slicing earnings to stockholders to $1.19 per share from $2.03 for the comparative quarter last year.

Notwithstanding the 42 per cent drop, Carreras' earnings per share (eps) continued to outperform most listed companies. The stock traded firm Monday at 46.

Its six-month EPS was $2.52 on dampened profits of $1.22 billion, compared to $3.07 from $1.5 billion of net earnings in the April-September 2005 period.

Carreras' financials reflect a more than $400 million containment of cost of sales in its half-year results to September, resulting in higher gross profits of $1.98 billion.

But the erosion of 'other income' from $655 million in 2005 to the current $5.5 million wiped away the gains.

The company's turnover of $3.24 billion resulted from its tobacco business, while it took a $4.7 million hit on its hospitality segment, having disposed of its hotel property last year to Couples Resorts for $658.8 million.

Carreras' balance sheet position was almost $2 billion lighter at $8.4 billion relative to the March 2006 year-end position (the depletion was $1.3 billion compared to September 2005) with fixed assets now stripped down to $87 million, compared to half a billion dollars to March 2005, nine months ahead of the factory lockdown at its tobacco subsidiary Cigarette Company of Jamaica.

business@gleanerjm.com