Pan-Jamaican Investment Trust refinances

pan_jamaican_logo280x150The first tranche payment of J$600 million due on a $2.5 billion secured notes obtained by Pan-Jamaican Investment Trust in 2012, became payable on maturity on July 22, 2014.
Pan Jamaican indicates in a release to the Jamaica Stock Exchange, that arrangements have been made to refinance the amount with effect from July 23, 2014 for a further two years.
The proceed from the notes was obtained when the company acquired additional shares in Sagicor Life Jamaica (now Sagicor Group) in 2012 for a consideration of $3,055,100,542. The original funds were obtained from a private placement with maturities ranging from 2 years to 5 years.

Jamaica Money Market Brokers raise US$20M

jmmbGrouplogo150x150Jamaica Money Market Brokers raised US$20,000,000 through the issue and private placement of unsecured extendible notes denominated in United States dollars. The offer was only available to Jamaican residents.
The private placement offer closed on July 18, 2014 and will mature on July 18, 2016. Note holders have an option to either redeem their notes on the Maturity Date or extend the maturity of their notes to July 18, 2019. The interest rate on the original note is 6.75% fixed for two years and 7.75% on the Extended Notes.
JMMB made profit due to the group’s shareholders of $2.83 billion for the year ending March 2014 and had total equity of $18.3 billion.

$100m of Scotia Group trade cancelled

scotiabanklogo150x150In Mondays trading on the Jamaica Stock Exchange, MVL Stockbrokers purchased 5 million Scotia Group shares at $20 each, amounting to $100 million. Towards the end of the close in the market, the trades were no longer posted.
A check with the manager of the stock exchange Marlene Street Forrest, stated that “the matter of the trade was brought to my attention and on checking it was discovered that the broker incorrectly entered the order as 5 million units when it should have been 500,000 units. Based on the investigation done and the information gathered, all the selling brokers were contacted to get there approval about the cancellation. This is the norm is such cases, where cancellation is contemplated as such the trades were reversed”. Instructions were given to place orders for $5 million each of Carreras, National Commercial Bank and Scotia shares, Ed Mckie of head of MVL Stockbrokers informed IC Insider. The orders were on behalf of an institution not a pension fund, IC Insider was advised.
In early trading in the market today, there were three significant bids to buy 5 million units of each Carreras at $34, National Commercial Bank at $18 and Scotia at $20. Scotia trades were the only one executed, the other bids were withdrawn before any trade took place. At the end of trading none of the Scotia Shares were traded and the bid was removed. In all likelihood the bids for the smaller quantities will resurface shortly.

5m share orders for Carreras, NCB & Scotia Group

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BNS const MVL Stockbrokers are in the market early Monday with three significant bids to buy Carreras at $34, National Commercial Bank at $18.12 and Scotia at $20.
The bids are for 5 million units of each of the stock. So far they bought all but 1,700 of the 2,618,405 Scotia Bank Shares at $20.
Information gleaned recently is that a pension fund was in the market for large blocks of shares and the bids of such size could be connected with the pension fund needs.
On Friday, Scotia Investment bought all the Scotia shares to tradefor parties connected with the brokerage house.

CWJ revenues rise 37% push CWC Plc

cable-and-wireless-worldwide280x150Cable & Wireless Jamaica grew mobile customers with continued momentum from last year, by 37 percent, Cable & Wireless Communications PLC (CWC) said in a press release, in their first quarter interim management statement for the June 2014 quarter.
The Jamaican growth, pushed the mobile customers in Jamaica to around 750,000 at June, up from 705,000 at March this year and helped to move mobile subscribers was up 20 percent, for the overall CWC group on like-for-like basis, the statement indicated. “LIME growth was driven by continued strong subscriber additions in Jamaica, where revenue grew 34 percent at constant currency”. For the June 2013 quarter, the Jamaican operations saw growth of 22 percent in mobile customers and 10 percent increase in revenue. The growth last year came at a jump of 64 percent in subscriber acquisition cost, the company said last year after the completion of the June quarter.
Group Trading Performance| CWC said that mobile revenue which now represents 55 percent of Group revenue, was up 4 percent across the Group in the First Quarter, with increases in Cayman of 11 percent, following the successful introduction of LTE services; and in Panama 5 percent, where increased advertising drove mobile data 21 percent. Panama also achieved mobile ARPU growth for the first time in five quarters following increased focus on pricing.
Broadband and TV revenue, hampered by slower network speeds, grew only 3 percent and this is a key area where we expect to see improved performance over time as a result of the investments we are making under Project Marlin. The modest growth in Broadband and TV was more than offset by continued decline in fixed voice revenue.
Revenue in the B2B/B2G business – Managed Services – was impacted by reduced Government activity in Panama ahead of elections in May, but CWC management say they remain confident that the new management team and organisational focus will come to fruition later in the year. BTC in the Bahamas delivered solid financial performance alongside improved network reliability during the quarter.
lime4GLTE280x150Upgrade| CWCP said “we have upgraded 126 of our mobile sites in Jamaica since 1 April 2014 and expect to complete our 4G network later this year. The fibre build-out in Cayman is complete with over 11,000 homes passed. In Barbados we have now passed 26,000 homes with high-speed fibre. In Panama we successfully launched Direct-to-Home TV and ‘Movil Cash’ products, and, although it is early in the programme, we are exceeding our sales expectations”.

J$ slips against US$ & British Pound

Dealers sold US$34,873,810 on Friday for 4 cents more than they did on Thursday with the rate closing at J$112.87 to One US dollar
The Canadian dollar fetched $1.27 less than the previous day as customers bought C$625,477 at J$104.89 and £1,926,6160 was sold at J$192.08, 59 cents higher than on Thursday

Scotia Group pushes All Jamaica Index by 1,786.85

scotiabankBuilding150x150Broker house Scotia Investments was the only buyer of the 875,724 Scotia Group shares that change hands in Friday’s trading on the Jamaica Stock Exchange. The prices of the stocks rose to close at $20, but traded as high as $20.99.
For the overall market, the prices of 11 stocks rose and 8 declined as 26 securities changed hands, resulting in 5,240,852 shares trading, valued at $35,553,505.
Main Market indices| The main indices closed sharply higher in Friday’s trading as heavily weighted Scotia Group, jumped to close at $20 by the end of trading. The JSE Market Index surged 1,598.01 points to 71,711.80 and the JSE All Jamaican Composite index exploded by 1,786.85 points to close at 78,895.01.
National Commercial Bank that released results after trading on Thursday, closed up by 6 cents to $18.06 while trading 51,599 shares and closed with a bid of $18.11 to buy 116,978 units.

NCB Profit grows set for $4.80 EPS for year

ncb-logoNational Commercial Bank reported impressive results for the nine months ended June 2014 compared with the nine months ended June last year. Net profit reported is $8.8 billion, an increase of 29 percent, or $2 billion for the nine months. For the latest quarter, net profit of $2.9 billion was made, an increase of 29 percent, from $2.27 billion in June 2013.
Earnings per stock unit amounted $3.56 and is set to get to $4.80 per share for the full year. Gross revenues of $42 billion increased 17 percent, or $6 billion from $36 billion generated in 2013.
As impressive as the results may appear two things have to be borne in mind, one is that in 2013 a large charge was incurred flowing from government of Jamaica debt swap, and the segment accounts show a mixed picture with just four out of the seven segments contributed to the improvement, as the others, recorded declines for the nine months. On the plus, was a $550 million reduction in loan loss provision, from $1.78 billion to $1.24 billion, with this year’s June quarter being $357 million or roughly half of what it was in 2013.
Staff cost a bit item, is up a bit, year over year, but part of that was due to the general insurance company coming into the group, for a part of the year. A more telling picture is seen form the quarter over quarter figures of $2.86 billion versus $2.7 billion for June 2013 quarter, which was marginally up.
Loans| Loans and advances, totaling $152 billion net of provision for credit losses at June 2014, grew by 12 percent, or $16.8 billion, compared to the loan portfolio as at June 30, 2013. Non-performing loans totaled $7.8 billion as at June 2014 ($6.6 billion at June 2013) and represented 5 percent of the gross loans compared to 4.8 percent as at June last year.
Deposits| Customer deposits were $205 billion, up 19 percent or $33 billion over the prior year. The increase was driven by growth in fixed deposits and savings portfolios, which increased by 65 percent and 10 percent respectively, over the prior year.
Capital| The Group’s stockholders’ equity stood at $78 billion, up 12 percent over the prior year.
The stock traded last at $18 and puts the PE ratio, at just 3.7 times the current year’s results. NCB declared another dividend of 35 cents per share, bringing the total in the last twelve months to $1.18. NCB remains a strong IC Insider buy rated stock.

Sweet River Abattoir & Supplies is not that sweet

Swt Riv logoSweet River Abattoir & Supplies Company Limited is a company the majority of Jamaican are unlikely to know. Well their profile will get a lift, with the release of a prospectus offering up to 46,633,000 Ordinary Shares to the public, at the invitation price of $3.86 each.
The subscription will open on Tuesday 12th August and is scheduled to close on Tuesday 26th August 2014 .The Company is seeking to raise $180 million from the IPO, to be used in reduction of bank loans, construction completion of the new factory facility in Westmoreland, installation of a solar energy generation system, working capital; and payment of the expenses of the Invitation. The minimum amount to be raised to facilitate listing on the junior market of the Jamaica Stock Exchange, is $50 million
Up to 20,763,000 Reserved Shares in the Invitation are for priority applicants. Brokers and advisor for the deal are, MoneyMasters Limited and VM Wealth Management Limited.
The prospectus states that the majority of the shareholders of the Company are pig farmers, some with capacity to substantially increase through-put.
Sweet River in 2012, took a strategic decision to modernize the plant. The Company acquired lands in the Sweet River area of Westmoreland to establish a state of the art abattoir with expanded capacity along with administrative offices and warehousing facilities.

Sweet River planned factory facilities nearing completion in Westmoreland

Sweet River planned factory facilities nearing completion in Westmoreland

The new facility will consist of a modern semi-automated slaughter line, chill room and freezer facilities, break down and storage facilities amongst other infrastructure necessary for an efficient abattoir. The old facilities have the capacity to put-through 120 pigs per day on a single shift. The new facility will have a through-put capacity of 250 to 300 livestock per day. The new abattoir is said to represent the most modern and efficient facility in Jamaica and the Caribbean.
The company indicates that they are the third largest supplier of pork within the market with approximately twenty-four percent (24%) market share. The Company’s main customers include Grace Food Processors Limited, Caribbean Producers Jamaica Limited, and Hamilton’s Smoke House (a subsidiary of Jamaica Broilers Group).
A pig has the capacity to provide between twelve and eighteen cuts. Currently Sweet River produces twelve cuts from each pig. The Company sources approximately 60 percent of its pigs from ten contract farmers with the remaining coming from some 395 small farmers across ten parishes in Jamaica.
Profit & revenues|In the first year of operations as at March 2010, Sweet River generated revenues of $239 million. For the financial year ending March 2011, revenues fell to $181 million, which is attributed to a shortage of pigs which affected the company’s ability to supply the market. By March 2012, the company enjoyed revenues of $207 million. Revenues rose to $311 million for the financial year to March, 2014.
Profit before taxes increased from $564,000 for the year ending March 2010 to $21 million at March 2014 and was flat with the $22.6 million generated in 2013.
With 51 million shares in issue currently earnings per share works out at 40 cents, placing a valuation of 9.4 times historical earnings. This is well above the junior market valuation. Value based on a book value works out at 3 times book, again a very high valuation. There are other weaknesses. The unknown company and the vast majority of the directors, a one man auditor that is unknown to the investing public and the absence of audited accounts for the March 2014. Serious investors are unlikely to be drawn to this issue for sometime.

Treasury bill rates edge down

JamaicanMoney280x150The Government of Jamaica Treasury bill offer for the period Friday, July 25 maturing on Friday, October 24 this year for duration of 91 days, attracted bids of $732,981,900 for the $400,000,000 available.
The yield cane out at an average of 7.63643 percent. The result represents a small reduction from the 7.65893 percent yield, emanating out of the previous issue of a similar duration in June. In May, the rate was 8.2 percent for the Treasury bill of same duration. $832,672,600 went after the 400,000,000 Treasury bill instrument on offer. The offer which is of 182 days duration, matures on January 23 next year and will generate an average interest rate yield of 8.21982 percent versus the 8.36502 percent for the June issue of the same duration. At the May Treasury bill auction, the rate came out was 8.932 percent.