Buy Rated — Page 55

Huge 25% jump in Q3 results for NCB

July 28, 2016 by IC Insider.com

NCB posted a 16% jump in nine months’ profits & declared a dividend of 50 cents.

Jamaica’s National Commercial Bank (NCB) posted a strong increase in profit after tax, for the June quarter with earnings jumping 25 percent or $789 million over the 2015 June quarter, to $3.9 billion. For the nine months to June, profit is up 16 percent to $9.9 billion compared to $8.6 billion in the 2015 period.
Earnings per share ended at $1.88 for the quarter, up from $1.29 in 2015 and for the period to June $4.31 versus $3.48, with full year earnings are set to exceed $6.
The gains were helped by an 11 percent climb in loans and advances to reach $180 billion and a reduction in a number of areas of cost, including a fall in loan loss provisioning to $157 million in the quarter from $472 million in 2015 and for the nine months from $1.4 billion to $904 million.
Customer deposits increased by 18 percent or $38.9 billion over June 2015 to $256 billion.
Total operating income net of interest cost and fee and commission expenses increased to $12.76 billion from $11.68 billion, for the quarter and to $38.4 billion compared to $35.3 billion for the period to June. Net interest income increasing by 8.8 percent, or $1.7 billion, due to growth in the net loans and investments and a reduction in interest expenses driven by a decline in funding costs.
NCB management stated that for the nine months, net fee and commission income increasing by 10.3 percent, or $743 million, mainly due to credit related fees from growth in the loan portfolio, higher volumes of point of sale transactions and unit trust commissions arising from growth in the portfolios. Premium income grew by $388 million, or 6.8 percent, due to higher levels of life insurance and annuity contracts. Gain on foreign currency and investment activities increasing by 10.8 percent, or $305 million to $3.1 billion.
Overall expenses grew slightly from $7.46 billion to $7.64 billion for the quarter and for the nine months by 3.8 percent from $24.1 billion to $26 billion well below the increase in revenues.
NCB declared an interim dividend of 50 cents per ordinary stock unit payable on August 29, to stockholders on record as at August 15. NCB remains an IC Insider Buy Rated stock. In Trading the stock closed at $42.50 today on the Jamaica Stock Exchange for a PE of 7 and on the Trinidad and Tobago Stock Exchange at TT$2.75 or the equivalent of J$52.

Filed Under: Buy Rated, Company News, Company Results, Feature Stories

Carib Cement bad news say buy

July 25, 2016 by IC Insider.com

CCC Gte Jamaica’s sole cement manufacturing company Caribbean Cement, reported a fall in profit from $621 million in the June quarter of 2015 down to only $221 million and for the six months to June $1.05 billion versus $869 million.
Investors seemed to have focused more on the fall in the quarter than on the details of the results and the clear message sent by them. As a result, the stock was sold down to $19.25 from $23 the prior day, with very few buyers at the close, but investors who sold were making a bad decision. This is a classic case of bad news is indeed good news. For one, revenues climbed 9.6 percent in the quarter and 10.3 percent for the half-year but local sales of cement are up a very strong 27 percent. “Despite a reduction in export cement and clinker volumes by 8 percent and 77 percent respectively, total revenue increased by $777 million. This was mainly due to an increase in domestic cement volumes by 27 percent arising from increased projects and strong retail demand. Improvements in operational efficiencies, effective control of fixed costs, lower financing costs and lower energy costs, contributed to the improvement in earnings before interest, tax, depreciation, amortisation, manpower restructuring costs,” the directors’ report to shareholders stated.
Importantly, the cement company took a charge for manpower restructuring, amounting to $421 million, a huge positive development and augurs well for improved profit margin and increased profits going forward. In addition there is a charge for excess inventory amounting to $400 million, this is one off and therefore unlikely to recur. Stripped of these costs, earnings would be up by 63 percent to $1.16 million before tax compared to $708 million in 2015 that includes one off income of $168 million for the quarter and pretax profit of $2.1 billion versus $996 million in 2015.
Not only will the cost for redundancy not recur for the current set of staff being severed, it should results in savings in a year, in the region of the sum expended.
During the twelve months to June, the company repaid Trinidad Cement, its parent, loans and other debt $1.6 billion leaving only $556 million more to be paid. Cash funds were left at $788 million after more than $600 million was added to fixed assets since June 2015. At the pace profits are coming in the accumulated deficit of $4.6 billion will be wiped out in 2017.
IC Insider’s forecast for full years earning form normal operations is $4.75 which excludes the one off cost leaving the stock strongly in the buy column. The stock is listed on the main market of the Jamaica Stock exchange and closed at $22 on Friday.

Filed Under: Buy Rated, Company News, Company Results, Investment Tips Tagged With: Caribbean Cement, Jamaica Stock Exchange, Jamaican Stock, Trinidad Cement

Profit jumps 81% for Kremi

July 13, 2016 by IC Insider.com

Kremi Gapnt Profit jump 81 percent to $71 million for Caribbean Cream in its latest quarter to May this year, the company reported, from a rise of 9 percent in sales to $316 million resulting in earnings per share of 19 cents.
Gross profit climbed faster than revenues by 24 percent to $138 million as production cost dipped slightly to $177.5 million from $178.4 in 2015, as the company continues to benefit from lower prices of sugar and milk based major production ingredients and from energy savings.
Administration cost declined by $2 million to $54.3 million while selling and distribution cost came in at $10.8 million from $11 million in 2015 and finance costs fell to $3 million from $4.6 million as the amount of loan funding declined from $140 million to $120 million, Gross cash flow amounted to $85 million up from $53 million in 2015. Having funded loan repayment and acquisition of fixed assets, the cash inflows helped push cash at the end of 2016 quarter to $194 million, from $50.75 million at the end of May 2015. Shareholders’ equity climbed to $509 million at the end of the quarter.
The company has declared an interim dividend of 5 cents per share or $19 million payable in September. The stock traded at $5.50 but should head higher with earnings projected by IC Insider at $1 per share for the full year.

Filed Under: Buy Rated, Company News, Company Results Tagged With: Dividend, Jamaica Stock Exchange, Jamaican Stock, Trading Activity

Dolphin Cove Buy Rated again

June 14, 2016 by IC Insider.com

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Dolphin Cove now placed on the IC Insider’s Buy Rated list. The company is projected by IC Insider to earn $1.50 per share for 2016 after tax or 44 percent up on the earnings per share for of $1.04 for 2015. If the company achieves the above earnings the PE ratio would be 7.5 times 2016 estimated earnings, versus 8 for the average of the junior market.
As the year roles on the price is likely to increase, based on valuation of 14 times 2015 earnings, placed on the junior market, suggesting the possibility of the price doubling within a year. In addition the company pays regular dividends and this will add to returns investors will get from this stock.
First quarter results to March hit a profit after tax of $185 million for a strong increase of 39 percent above the corresponding period in 2015. The improved profit came from an increase of 11 percent in revenues to $520 million, due primarily to a 35 percent growth in ancillary revenue. Gross profit increased by 14 percent as a result of the growth in revenue and a decline in direct cost of sales while increase in operating expenses was up 5 percent over the 2015 cost to reach $297 million. There was new operating and administrative costs which the directors’ state contributed to the improved service delivery.

Birds at Dolphin Cove property in Ocho Rios

“During the quarter the Group made capital expenditures of $130 million to improve the facilities of the Parks which is expected to have a positive impact on our performance going forward. A dividend of 20 cents per share was declared in April and will be paid in second quarter of 2016. The Group was in a strong financial position as at the end of the quarter with improvements in working capital and net assets. We continue to expand our marketing efforts in anticipation of the additional rooms that are expected to come on stream during 2016 and there is the prospects of increased local sales with the recent opening of the Caymanas to Ocho Rios toll road which will significantly reduce the travelling time from Kingston. We also anticipate that our new enhanced website will continue to generate growth in our internet bookings and by extension our revenue. The financial resources of the group remain strong and this will facilitate our plans to expand our operations locally and in other Caribbean countries” the directors stated in their report to shareholders.
The company ended with cash and investments of $385 million, borrowings of $210 million and equity of $2.9 billion.
The stock last traded on the junior market of the Jamaica Stock Exchange at $11.10, but has a bid to buy at $11.25, with offers starting at $12.

Filed Under: Buy Rated, Company News, Company Results Tagged With: Dolphin Cove, junior market

Buy Rated stocks set for growth

June 6, 2016 by IC Insider.com

TTSE has declined almost 10% from peak and could fall another 9% from May to hit support around 1,600 points. (See orange trendline).

May is a period in the Jamaica stock market when prices usually sag, with a tendency to hit bottom between June and July. This was not the case in 2016 as the market peaked on the 4th of February and bottomed on April 21, based on the all Jamaica Composite Index.
In Trinidad, the market drifted from a peak in the all T&T index at 1,956.55 on December 8, 2015 to a 2016 low of 1,758.40 on May 19. The movements the Jamaica’s junior market saw the index peaking at 2,357.20 on 12th of January and bottomed out on the 7th of April at 1,762.87 points, for a decline of 24.5 percent but have since recovered most of the decline.
Much have happened with companies releasing results since with a number of the results in Trinidad being flat to declining, while most in Jamaica show good increased profit, while interest rates have declined in Jamaica and been static in Trinidad. Added to the profit out turn, a few companies in Jamaica announced stocks splits which have driven the respective prices of all the companies up strongly. Grace Kennedy, one of IC Insider Buy Rated stocks that has been lagging in performance, came to life as the company reported strong increase in the March quarter results, with the price jumping to $115 and seems to have more room to grow, based on the improved results. Pan Jamaican Investment gained 42.5 percent since it was last reported on at the end of April, helped by a 5 for 1 stock split and is up 82 percent since selected to the BUY RATED list. The company has good long term growth prospect but may have plateaued at the current price, around $26.50.

Honey Bun one of IC Insider’s 2015 additions to the BUY RATED list is now placed on Market Watch

The stock has been moved to a watch from BUY RATED.
Honey Bun added to the BUY RATED list in November 2015, gained 112 percent since April and 387 percent since being added to the list. Strong growth in profits and a 5 for 1 stock split helped in moving the value of the stock. ISP Finance added in April, is up 20 percent but there is little supply to be obtained, a recipe for a strong rally in the price ahead. Knutsford Express was put on hold when last reported on and has slipped 20.5 percent, is now restored to a buy below $20 while Lasco Distributors placed on a Watch list last time, is up 52.6 percent and is now placed on watch list at current price at $7.60, supply seems to be drying up for this stock, following release of full year’s results. While investors have priced in a potential big inflows from their law suit claim with Pfizer, at a PE ratio around 20 times fiscal 2017 operating profit, investing at the levels could result in an investment that may underperform the market in the medium term.
Cable & Wireless is up 22.5 percent since April and 332 percent since it debuted on the list in February 2014. The company reported a small profit from operation, for this year to March, and seems headed for earnings around 20 cents per share for 2017. The price should be heading higher before too long, but demand is not electric currently.

General Accident and Honey Bun are placed on the watch list with the former unable to get profit to rise outside the range of 30 cents per share and the latter now being priced at a PE of 18, well ahead of the average for the junior market. Honey Bun supply notwithstanding the 5 for 1 stock split, is scarce but profit growth could continue to be strong thus lending support to the stock going forward.
Companies in Trinidad are not doing well but their performance is not disastrous in the main with the price of a number of stocks have pulled back sharply and will offer good entry points when it is time to buy into that market. The time may not be right to enter that recession affected market just yet. Technical reading of this market shows it peaking at 2,032 points and have lost 13.5 percent since then and could fall another 9 percent from the May 2016 levels to reach 1,600 points before the decline is over. A look at the trading report shows that the prices of some major companies remain under pressure and is likely to fall as demand remains weak.
Technical and fundamental assessments suggest that Access Financial, Caribbean Cream, Medical Disposables and National Commercial Bank are due for a break out sooner than later, with Caribbean Cement to follow.

Filed Under: Buy Rated Tagged With: Cable & Wireless, Caribbean Cement, General Accident, Grace Kennedy, IC Insider BUY RATED, Jamaican Stock, Lasco Distributors, Medical Disposables, National Commercial Bank, NCB, Pfizer, TTSE

JMMB Group reports increased profit

May 31, 2016 by IC Insider.com

JMMB Group reports 12.3% increased 2016 profits

JMMB Group reports improved profit of 12.3 percent for the year to March 2016, of $2.3 billion, versus $2.05 billion in 2015 or earnings per share of $1.39.
The improvement flowed from increased net operating revenue net of interest expense of $11.42 billion from $10.32 billion in 2015 but increased cost helped keep the net position down as cost rose sharply by 12.8 percent to $8.78 billion from $7.79 billion in 2015.
Helping in the growth is an improvement in net interest income of $5.5 billion versus $5.26 billion in 2015 and a big jump in net gains on securities trading of $4 billion up from $3.4 billion in 2015.
The company’s stock trades at $9.50, down from $9.99 from Monday’s closing price, in the morning session on the Jamaica Stock Exchange today. The stock now trades at a PE of 6.8 times the 2016 earnings.
The company recently, declared a dividend of 18 cents per ordinary share, to be paid on June 30, 2016 to shareholders, on record as at June 10.

Filed Under: Buy Rated, Company News, Company Results, Feature Stories Tagged With: Dividend, Jamaica Stock Exchange, Jamaican Stock, JMMB Group

Cable & Wireless reports profit

May 31, 2016 by IC Insider.com

Cable & Wireless reports profit for the year ending March of $1. 2 billion, up from a loss of $8.9 billion in 2015. The company got help from net exceptional credit of $1.2 billion, even without this credit, the company made a small profit after finance cost but before taxation.
Importantly, C&W made an operating profit in the second half of the year of as Mobile revenues climbed by 22 percent.
The exceptional income stems from a reversal of $3.4 billion of restructuring cost written off in the 2015 fiscal year offset by employment restructuring cost in 2016. The company reports profit of $178 million in the March quarter compared with $486 million in the December quarter.
Revenues for the group rose moderately to $23 billion from $21.9 billion in the 2015 period while operating expenses fell to $15.8 billion from $17.4 billion but depreciation rose to $2.3 billion from $1.7 billion. Amortisation cost climbed to $1.1 billion from $848 million while finance cost remained fairly steady at $3.9 billion.
The company’s stock trades at $1.48 up 10 cents in the morning session from Monday’s closing price, on the Jamaica Stock Exchange today.

Filed Under: Breaking News, Buy Rated, Company News, Company Results, Feature Stories Tagged With: C&WJ, Cable & Wireless, Jamaican Stock

Flour pressed into more profit

May 24, 2016 by IC Insider.com

Profit after tax grew to TT$9.2 million up marginally from $9 million for the March quarter, this year at Trinidad’s National Flour Mills, from declining revenues of $111.2 million compared with $121.5 million in the 2015 quarter.
The company enjoyed earnings per share of 8 cents, compared with 7 cents in the 2015 quarter and 28 cents for the full year, in 2015 and could end up around 32 cents for the 2016 if the current trend continues.
The lower revenues “reflect the contraction in demand locally, and some timing differences with respect to large export orders which the company now pursues vigorously. Cost containment measures continue to provide the cash cushion to execute planned capital projects. Thus, growth in the regional export markets and more local content are priority strategies to improve both our sales revenues and foreign currency position” says Chairman Mike Bazle in his commentary accompanying the company’s quarterly results.
“It is thus important to note that the current economic environment continues to challenge the Company, particularly with respect to the timely supply of foreign exchange which is central to the financing of NFM’s grain purchases. When taken together with the cost implications of declining TT currency values, the company’s intention is to manage these additional costs, as key priorities, in order to ameliorate the impact on our customers,” the Chairman went on to say.
Despite the falling revenue, gross profit rose from $29.8 million to $31 million while Selling and distribution expenses were static at $7.8 million and Administrative expense declined to $10.74 million from $11.85 million.
Borrowing funds jumped to $122.78 million from $94 million compared to shareholders equity of $204 million.
The company is listed on the Trinidad and Tobago Stock Exchange and last traded at $2.20, with a PE around 7 times this year’s earnings and is priced below the average stock on the TTSE market. With recession and devaluation of the Trinidad currency investors are not aggressive in picking up stocks.

Filed Under: Buy Rated, Company News, Company Results Tagged With: National Flour Mills, TTSE

JSE first quarter results jump

May 12, 2016 by IC Insider.com

JSE frnt 2 Jamaica Stock Exchange reported a 44 percent jump in the first quarter profit to $126 million, from $87 million in 2015 for the three months ending March. The growth in profit flowed from revenues of $327 million, a 29 percent increase over the $253 million in 2015. The increase this year comes against the background that the quarter in 2015 results came from a loss position of $2.3 million.
Earnings per share ended at 89 cents in 2016 versus 62 cents in 2015. Profit before tax, grew from $130 million in 2015 to $187 million, with tax taking $61 million in the 2016 first quarter from $43 million.
Revenues growth benefited from increased trading activities this year over 2015, new business from the handling of repo business and from a big trade in the shares of Desnoes and Geddes, in 2015 there was a large trade in the shares of Scotia Group.
Expenses climbed at a slower pace than income, with an increase of 16 percent to end at $150 million. Wages climbed from $46 million to $57 million due to salary increases and additional staffing. Advertising and amortization is up from $14 million to $20.7 million, while other operating cost rose by $10.6 million from $5 million.
At the end of the quarter, cash and equivalent stood at $589 million and equity capital climbed to $751 million up from $649 million at the end of March 2015.
JSE’s stock traded on the Jamaica Stock Exchange with the price closing at $21 on Thursday.

Filed Under: Buy Rated, Company News, Company Results Tagged With: Desnoes and Geddes’, Jamaica Stock Exchange

Grace Kennedy’s blow out quarter

May 12, 2016 by IC Insider.com

Grace Kennedy profit for Q1 jumped 153%

Grace Kennedy reported a 153 percent jump in it results for the first quarter ending March with profit after tax of $1.5 billion versus $589 million in 2015. Grace reports that $606 million of the increase came from disposal of investment, with the bulk of it coming from the liquidation of a subsidiary.
Earnings per share ended at $4.51 compared to $1.78 in 2015 and the full year’s earnings looking to exceed $13 per share.
Grace reported sales revenues of $22 billion up from $19.36 billion in 2015, with profit from operations doubling to $1 billion, while other income amounted to $991 million up from $316 million in 2015.

Group Chief Executive Officer, Don Wehby steering the Grace ship to safer waters.

The food and trading division enjoyed the most growth, moving from $398 million to $855 million, the banking and investing segment recorded lower profits of $29 million than the $89 million in the 2015 period, while the money transfer segment, continues to deliver attractive increases of 26.5 percent, with profit of $587 versus $464 million and the Insurance division went up 48 percent from $67 million to $99 million.
The company attributed the strong increase in the food and trading division to “improved performance of our food distribution and manufacturing business in Jamaica and internationally.”
Grace’s stock has come in for increased demand on the Jamaica Stock exchange over the last few trading days, with the price closing at $84 on Thursday with 1,021,582 units traded.