Out of Frame: The LAB’s 6M Earnings Cut

Despite modest top-line growth, for the six months (6M) ended April 30, 2025, The Limners and Bards Limited’s (LAB) recorded a 58.3% decline in earnings driven primarily by higher direct and indirect costs.
Revenue for the period rose 3.3% year-over-year (YoY) to J$460.12Mn reflecting a 30.4% surge in revenue during Q1, underpinned by strong performances in the Production and Media segments. However, the 6 months outturn was stymied by a 23.0% decline in Q2 due to seasonal factors and the timing of project deliveries.
The company also saw an increase in direct cost to $284.75Mn, up from $265.19Mn. As a result, with direct costs outpacing the growth in revenues, gross profit for the 6M period fell by 2.7% YoY to J$175.46Mn. The results were also impacted by the fact that a higher proportion of revenue was derived from its Media segment, which typically carries lower margins relative to the company’s Agency segment.
Operating expenses increased by 10.3% (+J$14.4Mn) to J$153.5Mn, largely due to strategic investment in talent across content creation, business development, and client services. Management emphasised that while these investments have contributed to higher short-term costs, they are considered essential to scaling the company’s operations and building long-term shareholder value.
Against this background, net profit for the six-month period of $20.6Mn, a 58.3% decline compared to the same period in the prior year.
Looking forward, The LAB is focused on executing its “Five-in-25” content strategy, geographic expansion of its Agency and Production services, and integration of AI to drive efficiency and cost reduction. The company also plans to continue monetising its intellectual assets and scaling its proprietary content portfolio.
As at Monday, the stock closed at J$1.10, reflecting a 13.4% decline year-to-date. It currently trades at a P/E ratio of 17.49x, slightly below the Junior Market 'Other' average of 18.6x.

(Sources: NCBCM Research & LAB Financial Statements)