Remittance inflows for 2014 exceeded the amount earned by Jamaica in 2013 by US$95 million or 4.6 percent, according to data released by Jamaica’s Central Bank.
The country saw total inflows of US$2.16 billion for the January to December period. The total flows are likely to be just under the $2.2 billion estimated inflows from the tourism sector for 2014.
Net remittances for 2014 were US$1.93 billion, representing a growth of US$102 million or 5.6 percent compared to 2013 and emanated from an increase in gross inflows and a reduction of outflows.
The increase in total remittance inflows reflected an increase of US$95 million in inflows through Remittance Companies. This increase was however partly offset by a decline of US$0.5 million in inflows from the Other Remittances sub-category.
NCB ends at $28 in Trinidad Thursday
NCB closed up by $1.50 at $25 on Wednesday
A total of 60,000 shares were traded in Trinidad on Thursday. At the close the bid on the stock was TT$1.55 for 42,395 shares with no stock on the offer for sale
In Jamaica 184,000 unit of the stock traded between $24.10 and $25 with the majority at $25. There are only three offers on the board for 275 units at $25.50, 103,873 at $30 and 503 shares at $33.
NCB demand flows from good 2014 results with earnings of $4.73 cents per share and a hike in its dividend payments as well as robust first quarter results to December and the high level of undervaluation of the stock.
Loans grew by $8.7 billion, or 6 percent to $157 billion at the end of December last year from the similar period in 2013. Net profit of $2.1 billion, a decrease of 15 percent, or $368 million from the $2.5 billion earned in 2013 but the booking of the tax on assets was done in full in the December 2014 quarter instead of being spread over the entire year. This added $670 million to cost compared to 2013 resulting in the net profit getting a hit of roughly $400 million.
NCB reported that “gain on foreign currency and investment activities, up by $861 million. This was due to higher levels of foreign exchange income and gains from the sale of debt securities in the December 2014 quarter. Net fee and commission income, increased by $465 million or 22 percent, mainly due to Payment Services fees, related to card usage and transaction volumes, credit related fees from the growth in loans and greater corporate finance and unit trust fees, booked in the current period, net interest income, increasing by 2 percent, or $151 million, primarily due to growth in net loans and advances and investment securities portfolios.”
Treasury bills rates mostly fall
Interest rates are down on the latest issue of treasury bills compared with the out turn in February, for the three and six months instruments but the 28 days instrument enjoyed a slight increase compared with the rate at the February auction.
The 182 days bill ended with an average rate of 6.99 percent and is back to the level at the January auction. The highest rate allotted for the latest issue is 7.16 percent, while $948 million chased after the amount offered.
The 91 days instrument attracted bids for $720 million and resulted in an average rate of 6.3 percent with 6.8 percent being the highest rate allotted. The average rate for the February auction came in at 6.88 percent.
The 28 days instrument attracted bids for $655 million and resulted in the average rate being 6.7278 percent with the highest rate allotted being 6.9 percent. The average rate for the February auction was 6.417 percent.
All three auctions had $400 million each on offer to the public.
5 months of deflation for Jamaica
Jamaica is enjoying a respite in upward price movements since October last year with the price of oil on the world market having collapsed from US$100 per barrel to hover around US$50. The country had a 0.1 percent inflation in October, but declined in each of the following months, with the latest data showing February 2015 with a 0.7 percent decline in the All Jamaica ‘All Divisions’ Consumer Price Index. This followed the fall of 0.5 percent in January. Year-to-date inflation to February 2015, is -1.1 percent and since November last year the decline is 2 percent.
The Statistical Institute of Jamaica (Statin) indicated that the “main contributor to the decline, was a 3.6 percent decrease in the index for the division ‘Housing, Water, Electricity, Gas and Other Fuels’ resulting from lower rates for electricity and water. The reduction was tempered by an upward movement in the wages for carpenters, masons, plumbers, painters and electricians during the month. Also contributing to the decline was a 0.6 percent fall in ‘Food and Non-Alcoholic Beverages’, the heaviest weighted division. All other divisions recorded movements of below 0.5 percent.”
Increase were experienced by certain categories with ‘Alcoholic Beverages and Tobacco’ increasing by 0.3 percent, ‘Clothing and Footwear’ 0.2 percent, ‘Furnishings, Household Equipment and Routine Household Maintenance’ 0.3 percent ‘Health’ 0.4 percent, ‘Transport’ 0.1 percent, ‘Recreation and Culture’ 0.3 percent and ‘Miscellaneous Goods and Services’ 0.2 percent. ‘Communication’, ‘Education’ and ‘Restaurants and Accommodation Services’ recorded negligible movement for the period under review, Statin stated.
Eileen Chin resigns from Lasco
Eileen Chin has resigned as the Managing Director of LASM with effect from March 2, 2015 a release from LASCO Manufacturing Limited (LASM) announced.
The company advised that Robert Parkins has been employed with effect from March 3, 2015 as the General Manager of the company with responsibility for the day to day operations, reporting directly to the Executive Chairman. The resignation appears sudden has there was no prior notification of her intention to step down from the position she had held for several years.
Lascelles Chin, Executive Chairman informed IC Insider that Eileen Chin was taking a break from the operations but will be back before long. The company has been on a long period of expansion of the plant, costing more than $3 billion. Last year the liquid plant started the production of water and juices. The plant for powdered products is to be operational in 2015.
Profit up 92% spawns $817m SVL dividends
Supreme Ventures (SVL) will be making a surprise dividend payment to its shareholders in March and May. The company just announced a final ordinary dividend for the year ended December 2014 of 8 cents per share payable on March 21, 2015 to shareholders on record as at March 6. SVL also declared a special dividend of 23 cents per share to shareholders on record as at March 6, with 19 cents per share to be paid on March 21 and 4 cents per share payable on May 27, 2015. The stock will traded ex-dividend on March 4. The ex-dividend date for both dividends is March 4.
SVL paid dividends of 3 cents per share on January 8, last year as well as 3 cents in March, 9 cents in May, another 3 in September and 5 cents per stock on December 9, last year. The final regular dividend for 2014 brings the total relating to the 2014 profit to 19 cents per share or 54 percent of profits for the year. The total dividend payment just approved by the company totals 31 cents per share and is just short of the total profit for 2014 of 35.2 cents per share.
The company just reported full year results showing profit after tax rising by 93 percent to $930 million from revenues that climbed by 21 percent to $41.3 billion. The profit provided a decent return on equity of 24.2 percent. Earnings per share ended at 35 cents. The December quarter was a very good one for the company with revenues of $11.3 billion and profit after tax of $313 million more than half of the $617 million generated to September.
The company enjoyed cost reduction in several line items with professional fees being slashed the most falling $81 million to $239 million. Overall operating cost fell from $2.77 billion to $2.65 billion in 2014.
Credible as the gains in profit is for 2014, Management has lots more work ahead in cutting losses in sports betting amounting $194 million up from $130 million in 2013 and Gaming lounges losses of $461 million versus $556 million in 2013. For the December quarter gaming losses amounted to $85 million compared to an average of $126 million in the previous three quarters and sports betting contributed $46 million in losses for the final 2014 quarter. Without the losses in these two areas profit would have been much larger. IC Insider is forecasting profits for 2015 to be in the order of 45 cents per share.
At the end of the year the company had cash funds of $2.22 billion and the dividends amounts to $817 million will consume some of the cash on hand by time the payments are made later this month and in May.
GOJ intake ahead for January
The government of Jamaica enjoyed increased inflows into their coffers in January, bringing the total to $34.4 billion, $1.4 billion more than the $33.2 billion projected. The major area contributing to the improvement is tax on interest delivering $1.2 billion more than forecast.
The intake took the 10 months revenues to $322 billion down by $8.6 billion, just 2.6 percent short of estimates. The major contributors to the year to date shortage is corporate taxes, down $7 billion and production and consumption taxes on local goods and services down by $7.3 billion. Out-performing the target set are, PAYE, non-tax revenues and taxes on interest.
Payments are down, with capital spend coming in at $10.3 billion below projection, interest cost is $5.6 billion lower than originally projected due no doubt to lower interest rates, wages spend is $2.6 billion less than forecast and other expenditure is up by $3.3 billion. The fiscal deficit came in at $6.5 billion ahead of target and the primary surplus at $76 billion is just slightly ahead of target.
The data suggests that the fiscal deficit originally projected at $11.4 billion is likely to end at less than $4.5 billion for the fiscal year.
JSE could gain 40% for 2015
The all Jamaica Composite index is up 6.3 percent for the first two months of 2015 and the JSE index is up 6.2 percent and could be up nearly 40 percent for 2015 if the trend continues. The 2015 increase is the highest since the all Jamaica composite gained 9.4 percent in the first two months.
The JSE select index gain 9.2 percent over the same period. The movements to date translate to close to a 40 percent rise in the market for the year. If the movement was to continue at the same pace for the rest of the year it would take the all Jamaica index to 118,000 points by year-end and the JSE Index to 107,000.
The Jamaica Stock Exchange’s all Jamaica Composite index closed above 89,000 for the first time on Thursday, February 26, since mid-July 2103, and is a little more than 2,300 points from potential resistance at 91,720, the January, 2013 high. The market as measured by the index, has broken out of a channel going back to late last year, see green lines.
The junior market in contrast to the gains in the main market, is up only 1.7 percent.
BNS dumps US$19m in 2 days
Bank of Nova Scotia (BNS)
bought just US$3.9 million on Friday but sold US$17.8 million. On Thursday BNS sold US$12.6 million compared buying of only US$7.97 million, resulting in a net sale of US$19 in the two days.
On Thursday, National Commercial Bank (NCB) also sold more than they bought, with buying accounting for $6 million and selling US$10.5 million. NCB’s trade on Friday, was more balanced, with selling of just US$1 million more than they bought. While Scotia’s average selling rate was $115.70 on Thursday, on Friday it fell to $115.57, in contrast NCB’s average selling rate on Friday was $115.75 and $115.69 on Thursday.
There was more selling than buying of foreign currencies by dealers on Friday, with purchases of all currencies amounting to US$47,277,720 compared with US$42,778,081, on Thursday. Selling was the equivalent of US$64,474,492 versus US$52,219,662 sold on Thursday.
In US dollar trading, dealers bought US$44,421,153 compared to US$38,951,367 on Thursday. The buying rate for the US dollar climbed 5 cents to $115.28 and US$62,378,941 was sold versus US$49,786,691 on Thursday, the selling rate dropped 9 cents to $115.60. The Canadian dollar buying rate climbed 21 cents to $90.57 with dealers buying C$1,055,161, and selling C$1,040,220, at an average rate that remained unchanged at $92.62. The rate for buying the British Pound dropped $1.04 to $175.24 for the purchase of £1,068,882, while £726,396 was sold, at an average rate of $177.48, down by 44 cents. At the end of trading it took J$131.77 to purchase the Euro, 35 cents more than on Thursday, according to data from Bank of Jamaica, while dealers purchased the European common currency at J$129.28 for 34 cents over the rate on Thursday. Other currencies bought, amounted to the equivalent of US$402,706 while the equivalent of US$146,908, was sold.
Highs & Lows| The highest buying rate for the US dollar and the lowest buying rates remained at $115.90 and $94.52 respectively. The highest selling lost 11 cents to $121.12. The lowest selling rate fell 66 cents to $94.36. The highest buying rate for the Canadian dollar fell $1.68 to $92.32, the lowest buying rate dipped 92 cents to $73.12. The highest selling rate rose 12 cents to $95.56 and the lowest selling rate lost $1.10 to $88.10. The highest buying rate for the British Pound, dropped 74 cents to $177.76. The lowest buying rate climbed 21 cents to $142.97, the highest selling rate dropped $2.14 to $181.90 and the lowest selling rate was up 25 cents to $172.25.
Treasury-bill rates up
Interest rates on government of Jamaica latest Treasury bills auction rose for the first time since peaking in March last year. The three offerings at the February 20 auctions, resulted in a rise in rates for the 28 days and the 182 days notes, while the rate on the 91 days Treasury bill declined moderately.
The 182 days note closed at 7.164 percent, an increase from 6.99 percent at the January auction. The rate for the 91 days Treasury bills fell to 6.8796 percent, slightly down from of 6.8817 percent in January, while the rate on the 28 days ended at 6.417 percent up, from 6.295 percent at the January auction.
The change in the movement is consistent with the slowing pace of change at which the 182 days treasury rates were falling, having slowed from 0.34 percent dip in November to 0.15 percent at the January issue.
With Bank of Jamaica’s projection for inflation in 2015, in the range of 3-5 percent and with inflation for January coming in at negative 0.5 percent, its unlikely that the latest increase in the rates will last for too long, as there will be lots of room for the treasury rates to decline sharply in the months ahead.
All three instruments offered, were for $400 million each, with demand for the 28 days instrument amounting to $690 million versus $1.15 billion in January. The 91 days instrument attracted $1.298 billion up from $706 million in January and the 182 days instrument pulled in $822 million up from $717 million at the January auction.