Wisynco expects better Q2

December 2, 2018 by

Wisynco held its AGM on Tuesday, November 26, at the Sam Mahfood Distribution Centre, Lakes Pen Road, St Catherine. The well attended meeting was updated on the financials for the 2018 fiscal year ending June and the 2018 first quarter by the managing director, Andrew Mahfood.
Mahfood spoke to the major developments during the year and the quarter including the successful IPO last year. Shareholders were informed on the full resumption of the storage facilities at the headquarters, with cold storage being the latest to come on stream. He stated that not much savings was expected in the switch. There will be cost savings in rental and from a more efficient operation with just one location than two.
The company reported sales revenue of $25.54 billion up 14.8 percent from $21.38 billion in 2017 and generated net profit of $3.29 billion compared to $2.45 billion in 2017. Attendees were informed by the managing director that the 2017 net profit included the one off income from the insurance claim amounting to $636 million before tax which relates to the fire that occurred in May 2016.
The installation of two new bottling lines and one new filler Mahfood told shareholders and guests, should result in 40 percent more efficiency, the lines allows for less packaging material being used to produce bottles and will also result in lower transportation costs. The new lines have created capacity to meet increased demand and facilitate increased exports sales. For the first quarter sales revenue grew

Shareholders at Wisynco 2018 AGM.

just over 12 percent to $6.8 billion but should rise faster in the second quarter with new products for distribution and increased production to meet market demand. Profit grew 15.7 percent to $779 million in the September quarter, from $698 million in 2017, with earnings per share for the quarter ending at 21 cents and is projected by IC Insider.com to reach $1.10 for the full year. Gross Profit also increased to $2.6 billion or 10.4 percent over the $2.3 billion achieved in the same quarter of the previous year. Gross Margin of 37.8 percent was slightly lower than the 38.4 percent for the 2017 first quarter due to the commissioning of the new beverage lines and the devaluation of the Jamaican Dollar, management indicated.
Selling, Distribution & Administrative Expenses for the quarter totaled $1.73 billion or 11.4 percent more than the $1.55 billion in 2017.
Both Andrew and William Mahfood seem very optimistic that the second quarter will show improved sales growth over the first quarter. The settling down of the new lines are major factors as well as continued economic growth in the Jamaican economy.
But the operations were not without problems. The operation of the new equipment took time to settle and this resulted in dislocation in supplying the marketplace with adequate supplies, which held back sales in the first quarter. That problem seems to have been resolved as sales have improved, the two Mahfood brothers told IC Insider and this will show up in increased sales in the second quarter and beyond. Distribution of the Rum Bar brand of spirits produced by Worthy Park Estates commenced in November. Sales from this is expected to reach $500 to $600 million per year, while the distribution of sugar will commence in 2019.

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Profit jumps 40% at Caribbean Flavours

November 26, 2018 by

Caribbean Flavours traded on the Junior Market at $20.

Profit at Caribbean Flavours climbed 40 percent in the quarter to September this year to $25 million from a rise of 21 percent in sales to $120 million, up from $100 million in 2017 and an increase of 137 percent in other revenues to $5 million.
Improvement in profit margin in the in the quarter to 37 percent from 36 percent in the 2017 is also a contributing factor in the improved profit. The effect, gross operating profit rose 23 percent in the quarter to $45 million from $36 million.
Other operating and administrative expenses rose 22 percent to $24 million from $19.4 million in 2017.
Earnings per share came out at 28 cents, for the 2018 fiscal year earnings per share was 97 cents. The company should end the fiscal year to June 2019 around $1.50.
Growth in profit has not been always robust even though it has been positive. Profit before Taxation grew a mere 1.59 percent in 2014, 12.75 percent in 2015, a more respectful 28.34 percent in 2016, a reduced rate of 11.89 percent in 2017 and even less growth of 5.22 percent in 2018.
“The company expects that there will be improvement in our performance in the next period as we

Caribbean Flavours’ produce inputs.

expect sales of Flarorfit, our sugar reduction solution to gain traction,” Chairman of the board Howard Mitchell, stated in his report accompanying the quarterly.
Gross cash flow brought in $26 million. Addition to fixed assets used up $3.5 million and $19 million was used to pay dividends. Cash and invested funds amount to $220 million. At the end of the quarter, shareholders’ equity stands at $424 million with borrowings at just $9 million. Net current assets ended the period at $309 million well over Payables of just $30 million.
The stock traded at $20 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 13 times 2019 earnings. The stock is ripe for at least a 5 for 1 stock split, with limited supply and just 90 million units issued.

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Trinidad gets first junior listing

November 21, 2018 by

Cinemaone Limited is the latest listing on the Trinidad and Tobago Stock Exchange. The company was listed today and is the first company to list on the SME section of the exchange.
There was no trading in the company’s shares and none were offered for sale and there were no bids to buy the stock at the close. a total of 6.4 million shares are issued and the opening price was placed at $10.
Trinidad and Tobago Stock Exchange established a market for Small and Medium Enterprises, the SME Market after the government of Trinidad and Tobago announced in 2012 special tax concession for companies listing on this exchange.
The company operates cinemas in Trinidad and Tobago and had revenues of TT$15.2 million for the year ending September 2018 and $12.7 million in the previous year, with profits after tax of $867,000 in 2017 versus $1.5 million in 2016 after making $1.5 million before tax in 2017 versus $1.1 million in 2017.

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Profit jumps 83% for tTech

November 20, 2018 by

Profit at junior market listed tTech, rose 83 percent in the September quarter, to $12.2 million from $7 million in 2017 and for the nine months to September, profit climbed 59 percent to $29 million from $18 million in 2017.
Sale revenues grew 25 percent for the quarter, to $70 from $56 million but was up 31 percent for the year to date, to $215 million, from $164 million in 2017. Investment income brought $12 million for the nine months and $7 million for the quarter
The company is overcoming a period when profit retreated from the high level generated when it went public back in 2015, as the build out of staffing ahead of increased business sapped profits. The company seems to believe that the work they have put out to attract customers is now bearing fruit, with more to come going forward.
Profit having risen to peak at $39 million in 2016, on rising sales revenues, in 2017 both revenues and profit declined, with the profit declining below that earned in 2015 as it hit $19 million down sharply from the 2016 out turn.
Gross profit margin in the first 3 quarters of this year, is up just 14 percent to $161 million compared to revenues that grew 31 percent and it rose by 9 percent in the September quarter to $51 million, just a bit below the growth rate in sales.
Other operating expenses increased 52 percent to $20 million for the nine months but grew 29 percent to $7 million in the quarter. Administrative expenses rose 12 percent to $42 million in the quarter and increased just 8 percent in the nine months period, to $125 million.
Earnings per share came out at 12 cents for the quarter and 27 cents for the nine months and should end the fiscal year ending to December, around 40 cents. IC Insider.com is forecasting 80 cents per share for  a PE of  8 times 2019 earnings
“We have had a good third quarter and our business development team continues to leverage the momentum by closing opportunities presented to us. we expect continued growth and performance as we provide guidance and support for digital transformation,” the chief Executive Officer, Christopher Reckord stated in his commentary on the third quarter results.
Gross cash flow brought in $25 million but addition to fixed assets and investments resulted in a net buildup of funds for the year to date. At the end of September, shareholders’ equity stood at $207 million with no borrowings to support the operations. Net current assets ended the period at $164 million inclusive of trade and other receivables of $151 million, cash and investment balances of $152 million. In addition, the company has $31 million in non-current investments. Current liabilities stood at just $57 million.
The stock traded at $6.50 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 15 times 2018 earnings. Net asset value per share s $1.95 with the stock selling at 3.3 book value.

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General Accident nearly doubles profit

November 20, 2018 by

General Accident stock is undervalued.

Profit at General Accident Insurance rose 88 percent to $144 million, in the nine months September from $77 million in the similar period in 2017 even as profit for the quarter to September 2018 slipped 29 percent from $68 million to $49 million.
Earnings per share amounted to just 5 cents in the September quarter and 14 for the year to September and IC Insider.com estimates 40 cents for the full year and possible 80 cents for 2019. The stock last traded at $4, just less than twice net book value of $2.05. Annualized return on average equity of 9.45 percent up from 5.2 percent in 2017.
Gross premium for the year to September, grew 20 percent to $7.4 billion, while growth for the quarter was up an extremely strong 69 percent to $2.75 billion over the same periods last year. The company that is also looking to branch out to other parts of the region, also earned 51 percent more commission that the year before with nine months’ earnings rising to $495 million and it grew 104 percent for the quarter to $159 million but commissions paid grew 32 percent for the nine months to $212 million and by 44 percent for the quarter to $96 million. Net earned premiums grew 24 percent, for both the nine months to $1.20 billion for year to date and $531 for the quarter. Investment income including of foreign exchange gains is up 158 percent for the quarter to $144 million and 56 percent for the first nine months to $228 million.
Net claims grew by just 10 percent to $866 million for the nine months but jumped 42 percent for the quarter to $353 million. “Administrative expenses increased by 19 percent compared to the same period prior year, due to new hires to drive the strategic plan” management stated. Management expenses rose 35 percent to $554 million in the nine months and by 47 percent for the quarter to $201 million.
“General Accident ended the third quarter with a book value of $2.05 billion and generated annualized return on average equity for shareholders of 9.45 percent. Despite, low interest rates and increased competition in a very challenging operating environment. For the first nine months of the year, we were able to improve on our performance when compared to the similar period for 2017. The board and management team are committed to ensuring that General Accident’s financial performance continues to improve for the remainder of the year,” Paul Scott, Chairman and Sharon Donaldson, Managing Director said in their report to shareholders that accompanied the quarterly results.
The company ended the period with equity capital of $2 billion with $4 billion in insurance reserves. Assets total $6.7 billion and comprise liquid funds of $3 billion with amounts due from re-insurers and co-insurers of $1.5 billion representing a big jump from $875 million in 2017.

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Freeport to distribute 40c per share

November 18, 2018 by

The former Jamaica Stock Exchange listing, Montego Freeport made $44 million in profit for the twelve months to March this year which is up strongly from nearly $11 million reported for 2017.
operating revenue was a mere $1.7 million while other income amounted to $101 million versus $36 million in 2017.  The financial data extract sent to shareholders does not break out the details of other income, but 2017, the category comprised interest income from investments and receivables for land sale and foreign exchange gains.
The statement of financial position shows shareholders equity at $710 million or $1.26 per share. Shareholders at the general meeting slated for November 30 will vote on a resolution to pay a capital distribution of 40 cents per share in December.

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Sterling’s stock split effective November 27

November 14, 2018 by

Sterling Investments jumps to a high of $19 after split announcement.

The record date of the recently approved 5 for 1 stock split for Sterling Investments will be November 27, the company announced.
The split aimed at increasing the liquidity of the stock was approved by shareholders at an Extraordinary General Meeting on October 8.
Sterling’s most recent results to September, showed that the company’s fundamentals to be healthy, with gross revenues for the period hitting $134 million for the nine months to September 2018, an increase of 44 percent over revenues of $93 million in the similar period in 2017. Profit after tax grew 53 percent to $90 million for the nine months ended September, compared to $59 million in 2017.
For the September quarter, revenues rose to $56 million from $31 million in 2017, resulting in profit after tax for the quarter of $38.7 million versus $16 million in 2017. The 2018 result compares well with the full year results for 2017 when profit of just $52 million was realized from $92 million in revenues.
Sterling garnered $74 million in foreign exchange gains for the nine months period compared to just $11 million for the similar period in 2017 and $35 million versus $9 million in the quarter. Some of that seems set to be reversed in the final quarter of the year as the Jamaican dollar has since revalued and is unlikely to be reversed before year end.
The company reported that details of the upcoming rights issue will be announced shortly. IC Insider.com gathers that the plan was originally, for the split to have followed the rights issue, but that seems to have changed with the announcement of the date for the split.
Shareholders’ equity increased from $895 million at September 2017 to $922 million at September 2018 while total assets under management amounted to $1.27 billion.
The stock last traded at $20.50 on the Jamaica Stock Exchange up from from $14.50 at the time the proposed split was announced in mid September.

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Profit up 10% at Wisynco

November 9, 2018 by

Profit before taxation at Wisynco for the September quarter, increased or 15.7 percent to $928 million over the $802 million earned in the September 2017 quarter.
For the September 2018 quarter Wisynco Profit Attributable to Shareholders rose 10 percent to $769 million or 21 cents per share compared to $698 million or 19 cents per share for the corresponding period in 2017 when there were less shares issued.
Revenues for the quarter grew 12 percent to $6.8 billion over over the $6.1 billion achieved in the corresponding quarter in 2017. Gross Profit grew 10.4 to $2.6 billion or 10.4 percent over the $2.3 billion achieved in the same quarter of the previous year. Wisynco indicated that Gross Margin of 37.8 percent was slightly lower than the 38.4 percent for the corresponding quarter of the previous year due to the commissioning of the new beverage lines and the devaluation of the Jamaican Dollar.

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Record profit for NCB Financial

November 8, 2018 by

NCB had a good 2018 fiscal year with strong profit gains.

NCB Financial Group recorded record net profit of $28.6 billion for the financial year ended September 2018 with net profit attributable to the group’s stockholders of $28 billion, an increase of 46 percent or $8.9 billion over the prior year.
Based on the results an interim dividend of 70 cents per ordinary stock unit will be paid on December 7, to stockholders on record as at November 23, 2018.
Importantly, loans and advances, net of provision for credit losses, grew by 70 percent over the prior year to $372.6 billion, but was helped by the acquisition in 2017 of the majority shares and the consolidation of Clarien bank in the group financial. The inclusion in the group’s financial increased the portfolio by over US$700 million the company indicated. For the year, “there has been sizeable growth in the Jamaican loan book totalling $56.1 billion”, the company said. In addition, credit card receivables increased by 14 percent and the Cayman portfolio grew by 67 percent. Non-performing loans totalled $18.2 billion at September 2018 (September 30, 2017: $5.4 billion) and represented 4.8 percent of the gross loans compared to 2.5 percent as at September 30, 2017. This increase was due to the inclusion of Clarien which has a non-performing loan ratio of 11.8 percent.
 Customer deposits increased by $196.4 billion or 68 percent, to $484.8 billion, again primarily driven by the consolidation of Clarien which has deposits in excess of US$1.1 billion. The Jamaican deposit taking segments accounted for a total combined increase of 18 percent, the report to investors stated.
According to the directors of the group “for the financial year, operating income grew by 29 percent or $17.1 billion, to $76.5 billion. The growth in income was primarily driven by: Gains from foreign currency and investment activities increasing by 102 percent or $7.9 billion, resulting from an improving macro-economic environment coupled with high levels of JMD liquidity and declining interest rates generating a high demand for debt securities. Increased net interest income of 18 percent or $5.4 billion. The improvement was primarily attributable to the consolidation of Clarien’s results and growth in the Jamaican loan portfolio. Net fee and commission income growing by 15 percent or $2.1 billion. $1.1 billion of the increase was due to the consolidation of Clarien. The improved fees earned by our Jamaican entities were driven by an increase in the number of corporate finance, investment and financing solutions offered by NCBCM. There was also growth in fees earned by our payment services, retail and SME segments stemming from increased e-commerce and credit transactions. A 14 percent or $1.1 billion increase in premium income.”
Profit for the last quarter was $7.3 million attributable to shareholders resulting in earnings per share of $2.97 with mots of it earned from ongoing operations. For the full year EPS is $11.39 and is swollen by approximately $2 from non-recurring gains. NCB seems on target to report earnings in the $12 region for 2019. The stock traded up to $135 on Thursday and last traded at $133 for a PE of 11 times 2019 estimated earnings. With the markets PE around 15 times 2018 earnings the stock should be trading in the $175 to $200 range by the end of 2019, with dividend payments adding close to $4 to the pot. NCB Group is set to benefit from a growing Jamaican economy for some years to come and is therefore a good medium to long term investment.

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Profit jumps 71% at Eppley

November 6, 2018 by

Profit climbed 71 percent in the September quarter at Eppley this year, to reach $36 million from $21 million in 2017 period. For the nine months to September, profit surged a slower 56 percent to $80.7 million from $51.6 million in 2017.
Interest income rose 27 percent for the quarter, to $84.6 million, up from $66.7 million and rose 23 percent for the year to date, to $234 million compared to $191 million in 2017. Other operation income increased a strong 105 percent to $34 million from $16.7 million in the 2017 third quarter and is up 73 percent to $68.5 million for the nine months.
Net interest income grew to 47 percent of income versus 36 percent in 2017 in the quarter and 46 percent for the 2018 nine months period compared to 39 percent for 2017, the improvement resulted from cheaper funds acquired during the year as interest rates in the country fell sharply.
Administrative expenses rose 90 percent to $39 million in the quarter and increased 55 percent in the nine months period to $98 million.
Earnings per share came out at 19 cents for the quarter and 42 cents for the nine months and should end the fiscal year ending around 60 cents and for 2019 it should be in the region of 90 cents.
Gross cash flow brought in $75 million but changes in working capital and net loan inflows and the payment of $46 million, resulted in a modest decline in funds of $15 million for the nine months. At the end of September, shareholders’ equity stood at $740 million with borrowings at 2.27 billion. Loans receivables including lease and premium financing is $2,13 billion while investments in securities amounted to $363 million. Cash and bank balances the period at $384 million.
The stock traded at $8 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 13 times 2018 earnings. Net asset value is $3.85 with the stock selling at just over 2 times book value.

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