Where are the 1834 Investments results?
1834 Investments Limited (formerly The Gleaner Company Limited) did not release the usual December quarter report as such investors have been deprived of important information on the company. The stock exchange has fallen down badly on this one in not requesting it. No good reason has been given why it was not released.
Apparently the exchange regulatory arm expected that the 15 months report to March this would have been released to let the matter go away but it has not. First out of the block towards the end of May, 1834 Investments advised the Jamaica Stock Exchange that the Audited Annual Financial Accounts for March, 2016 will be late and unavailable for publication by May 30, 2016. 1834 anticipates that it should be available for publication on or before June 30, 2016. Bad news for investors and bad news for the capital market. The matter gets worse, the end of June has now gone and with July well advanced but there are no results released and no advisory on the JSE website or in the newspapers as to the new deadline. Nearly seven months have elapsed since the last report was released.
In the past several companies have changed their year end, as recently as late last year Desnoes & Geddes and Access changed their but provided investor with results for all relevant quarters, but the Gleaner Company who changed theirs to March from December did not do so.
It is well past the time for the Jamaica Stock Exchange act to protect the investing public.
Where are Gleaner’s Q4 results?
IC Insider,
I get the impression that the Jamaica Stock Exchange (JSE) no longer balances shareholder interests with listed companies’ interests. Here’s what I mean.
1. Duke Corporation (PriceWaterHouse) failed to pay the Scotia Group’s dividend on April 15th, and claimed that they notified the public via print and electronic media on April 14th. They further claim that they notified the JSE at the same time. Up to today, no such notice has appeared on the JSE website.
2. Supreme Ventures announced a directors’ meeting for April 28th to consider a dividend payment. Despite the JSE rules requiring companies to inform the public of the result of such meetings, with 48 hours, so far, nothing has appeared on the JSE website about it.
3. Gleaner should have published 2015 results up to December, but chose to change their financial to March 31st (i.e. 5 quarters for 2015). No problem, but does that change eliminates their responsibility to publish information for the quarter ending December 2015? What could possibly justify shareholders being kept in the dark about the company’s financial information from October 2015 to March, 2016 – which will not be seen until the end of May, 2016?
A concerned investor.
IC Insider’s Comments
Your views are well founded. For example the issue of the non-reporting of Gleaners December quarterly result was discussed with the stock exchange. The RMOD department gave some flimsy excuse for not requiring it. The JSE rules require either audited accounts within 60 days of the year-end or quarterly report within 45 days of each quarter. Since Gleaner had shifted the year-end then the rules require that they must submit the quarterly to December within 45 days. Discussions were also held with the General Manager of the exchange who agreed that the quarterly is required. To date shareholders are still in the dark on the financial data. Why the Gleaner never saw it wise to keep their shareholders informed by releasing the data, is a big puzzle. After all, other companies in the past that changed year-ends have release the 4th quarter results. As recently as December, last year Access released theirs having changed their year-end to March.
There seems to be a failure in the system to appreciate that the maintenance of the integrity of the system is paramount to protecting investors while at the same time sending a clear message that the system works and can be relied on. Quite a bit of what is allowed to take place is inimical to the growth and development of the capital market.
Lasco companies batter US$ investment
The prices have declined compared to when I bought them and I am concerned about the potential for further decline as the dollar continues to devalue. Should I just cut my losses and sell and convert to FX.”
The prices on June 6 last year were as follows – it took J$111.37 to buy US$1 and now its roughly $120, an increase of just 7.7 percent. Lasco Distributors traded at $1.32 then and is now at $4 for a gain of 203 percent, Lasco Financial Services traded on June 6th last year at $1.15 and gained 156 percent to trade at $2.95 on Friday last week and Lasco Manufacturing was at $1 in June 2014 and has gained 180 percent up to Friday last. It is clear from the above which investment was the better one to have made. Those stock while doing very well have not been the best performing on the local market since then. Cable & Wireless traded at 29 cents in the 2014 period and last traded at $1.05 a 262 percent gain, Desnoes & Geddes was priced at $4.25 and is now at $30, the Jamaica Stock Exchange was then priced at $1.95 and has increase by 464 percent and Caribbean Cream moved from 75 cents to $4.35 for a gain of 480 percent.
IC Insider’s response, thanks for your enquiry. As you will see our BUY RATED list contains these three stocks. Here are our views. First off the local stock market tends to go down around May until last June or July. This is not cast in stone, just a tendency. One reason for it is that investors get the full information as to what companies did last fiscal year and a glimpse for the new-year. In the case of the three Lasco companies they have just reported their full year results. The distributorship earning is the most encouraging of the three and looks like it will probably do better than the other three in the short to medium term. It will also benefit from the Salada Foods distribution which started this year, as well as from increased production to come from the expanded Lasco Manufacturing company’s operation. The information suggest that the next set of results should possibly show growth over that of 2013.
Lasco Financial seems poised for good things, but big marketing spend last fiscal year kept profits down as they went for more market share. It does look as if they will be spending on the world cup promotions which could build business, but may also keep profits pressured somewhat for a while.
Lasco Manufacturing seems cheap at $1 bearing in mind the impact that the factory expansion is likely to have on both sales and profits ultimately. Short term they will have to pick up interest cost and depreciation on the completed factory but will enjoy cost savings and ultimately increased profits.
One need to be careful of converting to foreign exchange at this stage, as the big move in the FX trade could be over. You may have to hold the stocks for a while but the investment could pay off in the medium term, more so in the case of financial and distributorship, during 2014. We would want to see he Q1 results for Manufacturing before jumping.
It is our view that the market overall, is undervalued but investors will need to be patient and the payoff is likely to huge for those who wait, the gains to be reaped elsewhere is not likely to be all that great, to cause one to jump and possibly miss the gains in the local market that is ahead.
I cannot understand
I guess I am getting too old to understand modern day practices or maybe it’s that the younger generation just don’t care about correctness. I could not understand how the Trinidad & Tobago Stock Exchange could have been so confused with the change in name for JMMB Group and listed them on their trading system as Jamaica Money Market Brokers Group Ltd. It was one thing to call the company by the incorrect name in publication of trading but a totally different thing to have the incorrect name in the official trading information as well as the fact sheet on the company.
I remember the days when there were heavy trading in stocks in Jamaica, in the 1990s when the market trading data was manually compiled and the indices computed manually. Back then, it took quite a while for the final report to be issued because they had to make sure the information was correct. Now we have errors being reported daily and there is no information going out to public to correct the errors.
I don’t understand for example why Sterling Investment could have told shareholders in their circular reporting the allocation for rights, for them to subscribe to, that the number of shares in issue is 40 million units and that the record date for the stock split was March 8 this year, and that the notice was published on the JSE website, yet a check on the trading sheets show no change in the trading prices of the stock with the last trading price, the highs and lows still at $134 nor the amount of shares in issue.
The last time we checked, the Manager at the exchange explained that there was a computer programming problem that prevented the highs and lows from being corrected in the case of the three Lasco companies. But that was from 2013, surely they must be able to sort that out by now and certainly, they ought not to be sending false data to the public without some notation to indicate what is the correct. One has to question where is the FSC in all of this?
A check on the JSE website still shows the number of issued shares of Sterling as 4,014,547, vastly different from what the rights issue circular says is the number. The Jamaica Stock Exchange is spending much to roll out a system of direct trading, all kudos to them, but they must pay greater attention to the little details that are of import. It cannot be right to leave errors out in the public for long periods without correction or at least a note as to the correct information. For example there are trading sheets posted with erroneous trading data because the markets hours were either extended beyond 1 PM or corrections were make after trading ended and the report released.
Recently a reader wrote of his concern about small trades which he asked his broker to avoid, here is what was said “the purchase of 200 Brow and 100 SVL: can you try to avoid such transactions by whatever means possible: deleting buy orders when only small volumes are available, deleting orders when only a small balance is remaining to be filled, etc- whatever you can do. This is retrograde step which JSE has taken and they are wrong in saying that is a global standard. I sure that it is not.”
The reader is absolutely correct. I had a case where a small amount of Cable & Wireless shares were traded, based of the various fees charged by the JSE and the brokers I ended up owing the broker although I sold the stock, that by the way is not a joke. I get the impression that the stock exchange sees investors the way the government sees tax payers, just milk them and ignore their pleas for we have the power. Whatever happened to customer friendliness or the customer is king or queen? Barbados has a system where small trades as routed through the odd lot market. Why can’t we do the same or better yet, treat orders as one trade for fee purposes when such orders are filled from many smaller amounts. Whatever the system the present one is wrong.
Lasco shares sell & buy FX or hold
On June 9, a reader wrote in with the question, “I respect your learned opinion and analysis in financial matters. In this regard, kindly advise if possible as to your views on Lasco Financial, Distributors and Manufacture. Do you believe that these stocks are likely to perform well in the short, medium and/or long-term. The prices have declined compared to when I bought them and I am concerned about the potential for further decline as the dollar continues to devalue. Should I just cut my losses and sell and convert to FX.”
Our response back then, thanks for your enquiry. As you will see our BUY RATED list contains these three stocks. Here are our views. First off the local stock market tends to go down around May until last June or July. This is not cast in stone, just a tendency. One reason for it is that investors get the full information as to what companies did last fiscal year and a glimpse for the new-year. In the case of the three Lasco companies they have just reported their full year results. The distributorship earning is the most encouraging of the three and looks like it will probably do better than the other three in the short to medium term. It will also benefit from the Salada Foods distribution which started this year, as well as from increased production to come from the expanded Lasco Manufacturing Company’s operation. The information suggest that the next set of results should possibly show growth over that of 2013.
Lasco Financial seems poised for good things but big marketing spend last fiscal year kept profits down as they went for more market share. It does look as if they will be spending on the world cup promotions which could build business, but may also keep profits pressured somewhat for a while.
Lasco Manufacturing seems cheap at $1 bearing in mind the impact that the factory expansion is likely to have on both sales and profits ultimately. Short term they will have to pick up interest cost and depreciation on the completed factory but will enjoy cost savings and ultimately increased profits.
At this stage one need to be careful of converting to foreign exchange , as the big move in the FX trade could be over. You may have to hold the stocks for a while but I would think that the investment will pay off in the medium term, more so in the case of financial and distributorship, during 2014. I would want to see he Q1 results for Manufacturing before jumping.
It is my view that the market overall, is undervalued but investors will need to be patient and the payoff is likely to huge for those who wait, the gains to be reaped elsewhere is not likely to be all that great, to cause one to jump and possibly miss the gains in the local market that is ahead.
High return on time investment
Participants at the JEF session, being addressed on the benefits of the equity market in Jamaica by John Jackson in May.
During the preparation process, one also has to be mindful of mandated time constraints, as well as the attention span of audiences or participants and so choices have to be made as to what’s in and whats out.
When I was asked by the Jamaica Employers’ Federation, JEF, to present an outline of a paper for their annual convention, I decided to suggest a topic that covered the capital market as a place for investors and entities seeking to woo investors to part with their money for a time, in exchange for the promise of future gains. Having achieved consensus and presentation prepared, my concern was, what was the interest of the attendees? I had no idea really. The JEF convention posed the problem that the session ran concurrently with others and covering two aspect of the market was challenging without knowing the audience’s interest. I decided from the start of the presentation to find out where the interest of the group laid. So although I did quite a bit on what it means for companies to go public, the bulk of an estimated 200 or so participants were interested in investing in the stock market. Many were either new to it, or fairly new and they wanted the information I had to offer. At the end of my presentation there were many questions and still more, after the session ended.
While I had a fair idea of how attendees felt, it is not always possible to categorically define the collective response. So when I received the comments below from the JEF, I felt that the many hours spent in preparation, delivered a great return on my investment.
RE: JEF CONVENTION 2016
The Executive of the Jamaica Employers’ Federation and the Convention Director, use this medium to express sincere appreciation to you for your contribution to the success of JEF’s Thirty- fourth (34th) Annual Business & Workplace Convention and Exhibition 2016, which was held at the Montego Bay Convention Centre, in St. James, between May 26 and 29, 2016, under the theme: “Empower People …. Energize Business”.
From the feedback received, your presentation on the topic: “Personal & Business Enrichment: The Equity Capital way for a Richer Future”, at a Concurrent session, was very well received and from the feedback, your content, perspective and engaging delivery style enhanced our participants’ knowledge and surpassed their expectations.
Thank you for your invaluable support and we certainly hope that we will have the honour of working with you again in the staging of another World Class learning event.
Yours sincerely,
Brenda V. Cuthbert (Mrs.)
CHIEF EXECUTIVE OFFICER