In this June 2005 file photo, Pulse chief executive Kingsley Cooper chats with his sister Donnette (centre) and co-founder of Pulse, Hilary Phillips, QC, at Caribbean Fashionweek, at the National Indoor Sports Centre, Kingston. - File

Boosted by 'sponsorship' support, Kingsley Cooper's Pulse Invest-ments Limited has recorded profits of $117.5 million for its financial year ending June 2006, representing a 86 per cent boost on net earnings over the previous year's $63 million.

Notwithstanding the better profit outturn, Pulse's earnings per share were drastically lower, coming from $1.62 a year ago to its current 88 cents due to a near quadrupling of issued shares from 38.8 million to 133.4 million.

The modelling agency had a strong year of revenue intake of $449 million - double the $221 million of gross earnings in 2005. But its expenses were steep, eroding more than $325 million of turnover for an operating profit of $123.8 million.

Advertising and promotions

Cooper said the expenses largely related to advertising and promotions, plus legal and professional fees incurred to re-list Pulse on the Jamaica Stock Exchange.

The accounts, audited for the first time by KPMG, shows a net improved balance sheet position of $688 million, including $338.6 million of fixed assets but also a $263 million item called 'advertising entitlements and unexpired sponsorships in kind' listed as a current asset.

Advertising entitlements

The total sponsorship received for the year actually amounted to $518 million, $386 million of which was recognised as income. Advertising entitlements and other sponsorships were an additional $263.8 million

Cooper, in an issued statement, said income from both entitlements and sponsorship was $431 million compared to $212.3 million the year prior, while rental income doubled from $6.6 million to $13.4 million.

"In pursuing aggressive expansion, Pulse has been deliberately selling its television programming across the Caribbean as well as in the U.S. and U.K. markets for non-cash advertising entitlements as the company seeks to develop a television product which is truly Caribbean in content," said the statement.

The agency, top in Jamaica, does model searches locally and regionally, and is a promoter of Caribbean Fashionweek, a showcase for regional designers.

Advertising entitlements are defined in the accounts as 'consideration' for Pulse's produced and branded programmes, which are expensed to the income statement when utilised; while unexpired sponsorships are services not yet utilised.

"The strategy of product sale for non-cash television entitlements is a comfortable interim arrangement for the company and for the television broadcasters, and will be pursued for the next two years while demand is built up not only in regional markets, but internationally," said Pulse.

At the end of the 2006 financial year, the company said it still held over $200 million in advertising entitlements to be used either as part of packages sold to sponsors or for expansion and marketing of new products.

lavern.clarke@gleanerjm.com.