Archives for July 2013

OCM profits growth slows

July 26, 2013 by IC Insider.com

One Caribbean Media revenues climbed 21 percent in the June quarter and 32 percent year to date over 2012. Profit after tax was up 10 percent in the latest quarter and 23 percent for the six month period. The growth in the second quarter is down on that of the first quarter when management stated that acquisitions and revenues flows from a state election in Tobago and elections in Barbados helped to boost revenues and profit for the March quarter by 40.4 percent.

OCM better results came as profits for the 3 months climbed to TT$20.3 million, up from TT$ 18.3 million in 2012, emanating from revenues which were up to TT$131 million. For the six months, profit after tax is up to TT$38.4 million from TT$31 million in the prior year. Both revenue and profits grew over the amount generated in the first quarter of this year.

Management is, however, cautioning as they did in the first quarter report when they stated that the second quarter will be tougher than the first but expect growth to continue. They are again sending a message of caution that the second half of the year will be more challenging.

Results comparison | The June quarter profit is just a shade off from the amount earned in the December 2012 quarter of $21.4 million from revenues of $145.7 million, as well as the amount earned in September quarter last year of $21.8 million from revenues of $132.6 million.

For most media houses, the first quarter of the calendar year is not usually the best in either revenues or profit as advertisers take a more moderate position in the first quarter coming out of the high expenditure of advertising during the Christmas period.

Profit 2012 | For the 12 months to December last year, earnings came to $74.75 million slightly up on the $69.45 million generated in 2011 from revenues of $495 million versus $451 million for non-interest income, an increase of 9.7 percent. Gross profit rose by 14.6 percent to $178 million from $155 million in 2011, showing greater level of efficiency in generating income.

Gross profit margin was 36 percent for 2012 up from 34.4 percent in 2011 is now up to 36.5 percent for the year to June reflecting a big improvement over the 32.6 percent generated in the first six months of 2012.

Financial health | The company is in a healthy financial position, generating annual cash flows of more than $70 million per annum, some of which it is using to acquire other income generating assets. Cash inflows could rise in the current year as profit seems poised to climb above that of 2012. Equity stands at $609 million with no debt and current asset ratio of more than 3 to 1, and cash funds of $144 million at the end of March. Funds are clearly being built up for further acquisitions.

Forecast | IC Insider continues to forecast profits of $95 million or $1.41 per share for the current year giving the stock a PE of 12.75 times earnings. Based on the Trinidad stock market PE ratio and Guardian Media which is at PE of 22, the stock is rated a buy for medium term appreciation, as the stock price could almost double based on these comparisons.

Insider call | OCM is now an IC Insider Buy Rated stock.

Related posts | OCM profits rise strongly

Filed Under: Company News, Company Results Tagged With: One Caribbean Media, TTSE

NCB cuts dividend in half

July 26, 2013 by IC Insider.com

NCB declared a dividend of just 8 cents in its latest dividend declaration. The last payment was 16 cents per share paid on May 24 and 23 cents in March 2013.

The latest dividend will be paid on August 26 and the ex-dividend date is August 9, 2013. The August payment represents a decrease from 17 cents paid in 2012 and the May 2013 payment represents a decrease from $0.21 paid in May last year. Further back in time, the dividend pay-out ratio for the 2012 financial year to September amounted to 27% and for the 2011 financial year 25.7% compared to 42.2% for September 2010.

The cut and carving of dividend payments from one period to the next is in keeping with an unpredictable policy the company has been executing despite a recent re-publishing of the Dividend policy (see below). This is in stark contrast with a very consistent and predictable policy of Scotia Group and many other companies on the stock exchange.

NCB Dividend policy, 2011 Annual Report | The Board of Directors of National Commercial Bank recognizes the importance of capital in meeting the needs of shareholders, investors and the business. To this extent, a dividend pay-out rate has been determined.

The Board of Directors will declare, at its discretion, dividends to shareholders. These dividends will be paid from the realised earnings of NCB. The dividends will be subject to a maximum of 50% of the ordinary realised profit earned each year and will be applied after taking account of all transfers. In the event that the pay-out is less than 50% in any one year, the Board of Directors reserves the right to increase future distributions proportionately.

Further, the Board, at its discretion, may distribute to its shareholders the full amount of any and all realised gains arising from non-recurring or extraordinary transactions. The Dividend Policy is consistent with the Capital Management Plan and is reviewed annually or more or less frequently as determined by the Board.

Filed Under: Company News, Dividends Tagged With: Dividends, JSE Company, NCB

NCB recovers from NDX hit

July 26, 2013 by IC Insider.com

Despite the cost of the Government of Jamaica debt swap earlier this year the year, National Commercial Bank results to June are just a little distance away from the 2012 profit for the similar period. The banking group reported after tax profit for the nine months at $6.8 billion down from $7.36 billion in 2012 and profit of $2.27 billion in the June quarter compared to $2.587 billion in 2012. Contributing to the results is improvement in operating income which increased by 6.3 percent, or $1.7 billion, when compared with the nine months ended June, 2012. The increase is mainly as a result of net interest income, which increased by 7.9 percent ($1.3 billion) coming from the growth in loans, and investments, net fee and commission income increasing by 11.6 percent ($618 million), primarily due to increased card transaction volumes and increased fees earned from new loans.

Premium income, increased by 143.4 percent, or $2.1 billion, due mainly to the inclusion of general insurance premiums as a result of the acquisition of Advantage General Insurance Company. This is in contrast to the six months ended March when operating income declined by $26 million when compared with the six months ended March 2012. The decline was mainly caused by a $2.4 billion reduction in gains on foreign currency and investment activities arising from the bank’s participation in the debt exchanges, which plunged income for foreign currency and investment activities to a loss of $729 million in the March quarter, compared to a profit of $1.4 billion in 2012.

Loan Loss | A $450 million increase in provision for impaired loans compared to June quarter 2012 helped to keep earnings below that quarter’s net profit resulting in the net 2013 profit falling.

The data suggest that they have almost recovered from the low interest rates they are getting on Government of Jamaica debt instruments. The results for the quarter represents a recovery from the profit of $1.744 billion reported for the March quarter when the write down of the government bond was recorded. The NCBJ group accepted the Government’s debt swap offer and exchanged $118 billion of eligible securities. The primary impact of the exchange is a reduction in coupon rates and an immediate hit was felt from the lower interest rates from new instruments, compounded by the extension of the tenure of the securities.

Expenses up | Operating expenses increased by $670 million in the three months to June over the March quarter, of which $230 million is due to loan provisioning and $400 million to other operating expenses. For the nine months, operating expenses are up by $3 billion but much of this would be due to the acquisition of the general insurance company who financials are merged into the group’s figures.

Loans and advances, increased from $128.8 billion at the end of March 2013 to $135 billion and is up from $107.6 billion at June 2012, growing by 25.8 percent year over year. Investments of $227 billion have grown, but at a slower pace than loans, which is a good thing as the former has lower yields than loans. While the provision for loan losses is up, the total non-performing loans totalled $7.5 billion as at March is now at $6.6 billion due to writing off of loans that were previously provided for.

Dividend | NCB declared a dividend of 8 cents per share payable on August 24. The stock closed at $19.51 at the end of trading on Thursday with 368,314 shares trading before the results were released.

Insider call | NCB is now an IC Insider Buy Rated stock.

Photo via MLAArchitect.com

Filed Under: Company News, Company Results Tagged With: JSE Company, NCB

FX: Buying picks up, selling flat

July 25, 2013 by IC Insider.com

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Thursday, 25th July 2013 | In Thursday’s forex trading, buying of foreign currencies exceeded selling by nearly US$7 million compared with nearly US$3 million on Wednesday. Authorised dealers purchased the equivalent of US$35.8 million and sold US$28.98.

They purchased US$30.96 million in US dollar currency and sold US$25.7 million with the average rate edging up slightly by a few cents for both the buying and selling rates. The Canadian dollar rates that were up on Wednesday, put on 97 cents on the buying rate and 48 cents on the selling rate and saw $1.75 and $1 being slashed off the rates respectively. The average rate for the Pound put on $1.36 for the buying rate and lost 32 cents for the selling rate.

The highest and lowest rates were relatively stable except for the Pound where the highest buying rate fell by 30 cents to close at $156.40, the highest selling rate fell 79 cents to close at $158.72 and the lowest selling rate dropped by $5.25 to $146.75.

Filed Under: FX Market, Stock Market Tagged With: Daily Trading, FX Market, Trading Activity

JSE: Another big trading day

July 25, 2013 by IC Insider.com

Thursday, 25th July 2013 | It was another big day on the Jamaica Stock Exchange on Thursday as stocks of 29 companies traded of which 10 stocks advanced and 10 declined as focus continued in main market shares and the juniors played second fiddle on a day when 14 million shares traded valued at $419 million.

The junior market index along with the US dollar index declined marginally and the main market and all Jamaica indices put on a few hundred points.

Trades of note Main Market | The all Jamaica Index gained 318.84 points to close at 88,373.07 and the JSE market index moved up by 181.21 to close at 87,056.96.

The major volume of shares traded include Carreras 6,429,852 for a value of $335,630,891which closed at $52.25, Desnoes & Geddes 1,555,217 valued at $7,362,606 with a closing price of $4.70, Gleaner Company 375,398 costing $1.18 with a value of $442,970, Grace Kennedy 150,694 valued at $8,453,933, Jamaica Broilers Group 1,701,351 amounting to $8,572,488, Jamaica Money Market 711,882 at a value of $6,041,743, National Commercial Bank 368,314 at $19.51 valued at $7,221,190, Scotia Group 1,575,654 valued for $34,255,608 closing at $21.20, off 30 cents, Scotia Investments 247,115 closing price $26.5 and valued $6,538,197, Jamaica Producers with 105,483 at $19.35 costing $2,035,822.

Hardware & Lumber traded 75,000 and the stock closed at a 52 weeks high of $4.60 an increase of 60 cents in response to the good six months results. Pan Jam lost 49 cents to close at $51.51 on small volume, Pulse Investments closed at 94 cents, a 52 weeks low as it dropped 66 cents.

Junior market | Stocks of 8 junior market companies traded on Thursday with moderate volumes and price changes. Lasco Distributors traded 127,650 shares valued at $192,752 and closed at $1.51 down 9 cents, Lasco Financial traded 149,500 shares valued at $214,648 and dropped 5 cents to close at $1.45.

Lasco Manufacturing traded 118,900 shares valued at $202,130 and closed up a cent at $1.70, Caribbean Producers traded 45,000 units at $2.05, and Access Financial Services traded 11,000 units at $8.50. KLE Group traded down again to a low of $2.29 down 31 cents for the day. The stock is now down 36% percent from the IPO price of $3.60.

Proven Investment Preference shares traded a small volume of 4,200 shares and the price held firm.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 9 stocks were higher with none having offer that was lower than their last selling price

Filed Under: JSE Main Market, Stock Market Tagged With: Daily Trading, JSE Company, Trading Activity

TTSE: TCL up again but market quiet

July 25, 2013 by IC Insider.com

Thursday, 25th July 2013 | Trading picked up from yesterday’s low levels with 13 securities being active on a day when prices advanced for 2 stocks, 6 stocks declined and 5 traded firm as a moderate 133,066 units traded for a value of $2.73 million.

Sagicor Financial Corporation traded 43,075 shares changed hands for a value of $263,603, Trinidad Cement stock price made another move in gaining 12 cents to end the day at $1.32 with a volume of 23,959 shares traded for $31,605. The stock closed the day without any stock being offered for sale. ANSA McAL accounted for 15,071 shares valued $999,154, while Prestige Holdings added 13,360 shares valued at $124,916. Clico Investment Fund, posted a volume of 13,000 shares valued at $279,500 and the stock price declined by 49 cents to end at $21.50.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer indicator shows that bids for 2 stocks were higher and 4 stocks had offers lower than their last selling price.

Filed Under: Stock Market, TTSE Market Tagged With: Daily Trading, Trading Activity, TTSE

Jamaica Broilers buy US egg company

July 25, 2013 by IC Insider.com

Jamaica Broilers Group Limited announced that they entered into an agreement on July 17, 2013, to acquire a leading producer and broker of broiler hatching eggs in the United States of America. This acquisition, if concluded, is expected to result in the doubling of the company’s fertile egg production output in the United States.

Completion of the acquisition, which is subject to certain conditions, is expected to be within forty-five (45) days. Under the terms of the transaction, the purchase price is to remain confidential until completion a release from the company said.

Jamaica Broilers, which is a Jamaican company, stated in its 2013 annual report that revenues from its external customers in other countries was J$2.23 billion and in 2012 just over J$1 billion. All of this income would not be related to eggs and this provides some information as to the likely contributions to revenue from the acquisition candidate. It is likely to bring about economies of scale as certain activities can be merged thus leading to cost reduction.

Jamaica Boilers is one of our Buy Rated stock.

Filed Under: Company News, General Business News Tagged With: Jamaica Broilers, JSE Company

BOJ offers 3 new CDs

July 25, 2013 by IC Insider.com

Bank of Jamaica will be offering three variable rate instruments commencing Friday, 26 July 2013 to Friday, 02 August 2013 as a continuation of open market operations. The announcement again comes at a time when it appears that authorised dealers are holding back on selling the foreign currency into the system as is evident for the past four days.

The instruments on offer are:

A 186-day Certificate of Deposit, for an unlimited amount. The instrument re-prices quarterly at 0.15 percentage point above the three month GOJ Treasury Bill rate existing at the start of each re-pricing period. The initial coupon for the first three months is 7.50 per cent per annum.
A 276-day Certificate of Deposit, for an unlimited amount. The instrument re-prices quarterly at 0.20 percentage point above the three month GOJ Treasury Bill rate existing at the start of each re-pricing period. The initial coupon for the first three months is 7.55 per cent per annum.
An 18-month Certificate of Deposit, for an unlimited amount. The instrument re-prices quarterly at 0.25 percentage point above the three month GOJ Treasury Bill rate existing at the start of each re-pricing period. The initial coupon for the first three months is 7.60 per cent per annum.

Filed Under: Economy, FX Market, Stock Market Tagged With: BOJ, FX Market, TBills

FX: Little more buying than selling

July 24, 2013 by IC Insider.com

Wednesday, 24th July 2013 | In today’s forex trading, buying of foreign currencies exceeded selling by nearly three million as authorised dealers purchased the equivalent of US$31.4 million and sold US$28.66. As far as the trading in US currency, US$25.59 million was purchased and $23 million was sold as the average rate slipped back moderately by a few cents on both for buying and selling. The Canadian dollar put on 97 cents on the buying rate and 48 cents on the selling rate. There was not much change in the average rate for the Pound.

The highest and lowest rates were relatively stable except for the Pound where the highest selling rate fell $3.66 to close at $159.51 the lowest selling rate moved up by 70 cents at $152.

Filed Under: Company News, FX Market, Stock Market Tagged With: Daily Trading, FX Market, Trading Activity

JSE: Carreras’ day but Lasco Financial now up 200%

July 24, 2013 by IC Insider.com

Wednesday, 24th July 2013 | Scotia Investments did some big trades on Wednesday in Carreras Limited as the brokerage house executed three large trades in the stock on behalf of clients. The first lot of 3,907,474 at $52.25 valued at $204,165,517, the second lot of 3,792,847 also at $52.25 valued at $198,176,256 and 2,347,297 units at $52.25 with a value of $122,646,268.

The stock lost 26 cents in trading. The Carreras’ trades were by far the largest on a day when 18.85 million units traded with a value of $613.65 million on the market. In spite of the negative news about the smoking ban and its impact on the company’s profits, there are still bids buy the stock at close to today’s selling price and about 350,000 units have bids from $51 and above. The total trading in Carreras shares amounted to 10.159 million units at a value of $520.8 million.

Advancing stocks climbed to 14 versus 6 that declined, 11 had no price change at the end of the day. In spite of the positive advance decline ratio the indices all declined except the US dollar index which rose marginally.

Main Market | The all Jamaica Index fell 101 points to close at 88,054 and the main market index fell 57.40 points to close at 86,875.75.

Scotia Investments was also the dominant broker in the trading of National Commercial Bank stock as $23.7 million was expended on the trading of 1.2 million shares as the stock closed at $19.50. They were also the major traders in Scotia Group which had trading in 890,000 shares valued at $19 million as the stock closed at $21.50 and gained 30 cents for the day. Jamaica Broilers had a big day, posting a volume of 3.57 million units at a value of $17.8 million as Scotia Investments played a big role in trading the stock. Jamaica Producers traded 158,600 units and closed at $19.20 up 19 cents. Pan Jam gained 50 cents on small volume to close at $52. Sagicor Investments gained $1.97 and closed at $18.50 as 5,000 shares traded, Scotia Investments gained 49 cents in continuation of the see sawing between $26 were there is demand ad $26.50, as 33,947 shares changed hands. Hardware and Lumber stock responded to the improved results released yesterday. In today’s trading the stock closed at $4 with 5,000 units trading but bids have now come in where there were none before for days.

Jamaica Stock Exchange ordinary shares have still not traded after two days of listing but there is a bid of $3 posted for just over 97,000 units which is above the issue price of $2.85.

Proven Investment ordinary shares which are quoted in US dollars traded 1.2 million units valued at US$140,640, the stock lost a fraction of a cent to close at 11.72 US cents.

Junior market | 11 stocks in the junior market traded with Lasco financial reaching a new all-time high at $1.50, the closing price as 203,000 units traded. At the end of December last year, the stock was trading at $4.90 or 49 cents based on the stock split hence the price has gained more than 200 percent in the process. Lasco Distributors traded 205,600 units to close at $1.42 but traded as high as $1.53 on the day, Lasco Manufacturing chipped in with 243,899 units to close at $1.69 down from $1.80 on Tuesday. Mayberry bought out the 100,000 Blue Power stocks that were on offer at $10.50 for in house purposes, the stock is up 47 cents on the day, leaving only two small offers at $11 and $13.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 6 stocks were higher with 2 stocks having offers lower than their last selling price.