Company News — Page 120

Looking for a more affordable apartment

November 11, 2014 by IC Insider.com

The corporate area in Jamaica has the densest working population. Most workers would prefer to live close to work, property prices preclude many, from living within the urban area of Kingston and St Andrew.

2 bedroom unit living area

The result is the rapidly growing residential areas in St Catherine, the neighbouring parish, as Jamaicans seek affordable housing close to Kingston.

Bedroom of 1 bedroom unit

St Andrew has some of the most expensive residential real estate in Jamaica. The reduction in readily available open spaces, has driven up the value of land and the selling prices of new units. While the cost of money has declined from very high levels, a few years ago, it is still high, compared with other countries within the Caribbean. Higher interest cost like higher land cost helps in driving the price of houses up and makes them less affordable to purchasers. As the prices climb and income levels remain pressured, many developers have reduced inputs cost, more often by downsizing lots or units. Units can be altered by square footage and high between ceiling and floor. Often, they utilize less expenses fittings, which the owner may change out, some later point in the future.
As more units are built in what is considered the preferred residential areas, there is a trend that has seen units being built some distant from the main areas.

Living room for 1 bedroom unit

IC Insider visited one such complex recently. El Gabriel is locate on Lindsay Crescent, just off Dunrobin Avenue and comprises 18 units 1 and 2 bedroom and penthouse units, priced between $10.4 million to $13.7 million.
The complex is gated, units are floored with porcelain tiles and have granite counter tops. The sizes are, 1 bedroom units 531 square feet, 2 bedroom – 816 square feet and penthouses 769 square feet.
The selling price per square foot works out at $19,585 for the 1 bedroom and $16,409 for the 2 bedroom units.

Filed Under: Company News Tagged With: El Gabriel, Jamaica real estate

JMMB maintains dividend

November 10, 2014 by IC Insider.com

Jamaica Money Market Brokers (JMMB) is holding the December 2014 dividend payment steady, with the amount paid last year, at the same time.
JMMB declared of a dividend of 16 cents per ordinary share payable to shareholders on record as at November 21. to be paid on December 16, 2014. The stock will trade ex-dividend on November 19, 2014.
The company paid a dividend of 17 cents per ordinary share on June 26, this year. A payment of 16 cents per share was made on December 18, last year.

Filed Under: Company News, Dividends Tagged With: Dividends, Jamaican Stock, JMMB

Is $1.65 too high for C&WJ shares by 2015?

November 9, 2014 by IC Insider.com

Cable & Wireless (C&W), an IC Insider BUY RATED stock, traded 7,481,913 shares closing at 32 cents on Thursday, following the release of the announced acquisition of Columbus International operation and news of continued strong growth in new cell customers.
Trading on Wednesday, resulted in 5,310,349, units changing hands, between 25 and 28 cents while there were 5 million units on offer at 28 cents, with the bid at 25 cents, to buy 5,794,204 units. With all the news fully disclosed, 8 brokers had bids to buy almost 10 million shares at 36 cents each on Friday. Trading was attempted at 37 cents, but the 15 percent limit resulted in cancelation of the trades.
What is clear is that the price will most likely close on Monday above the bid price of 36 cents, with 41 cents, the maximum possible it can trade, likely to be the close. The big question to be answered is, what price will the stock reach to induce fair stability in the price. Without earnings or even positive net asset value that could be used to value the stock, investors either has to use future estimated earnings or income per share or some other such method to value the stock. But other calculations would be needed to arrive at an approximate level. The other approach is the use of technical assessment. Below the likely price levels are stated before some form of resistance to buying takes place. The present supply demand scenario suggest that the recent high of 70 cents will be taken out sooner than later.
CWC Communication has not yet disclosed how they will treat with Flow within the group. One can speculate as to what may happen sometime in the future, one possibility is that Cable & Wireless will collapse the Flow operations into the local Cable & Wireless entities, thus cutting cost. What is more important, for investors, is what is taking place at C&W locally. With continued strong growth in cellular customers, the company has around 830,000 cell customers and could reach around 900,000 by year end. At this level and the possibility of further growth, the company should be making decent profit, between this fiscal year and the 2016. IC Insider is expecting the September results to show a reduced operating loss, than the $600 million incurred in 2013, with the possibility to either break even or making a small profit for the year to March 2015.
Heavy buying| At the end of trading on Friday, C&W had 9,997,276 units to buy at 36 cents and just under 232,000 units to sell at 50 cents and only 4,849,062 in total is on offer between 50 and $1. Earlier this year there was not much volume that was available before the price got to 70 cents and then selling came in, more importantly buying thinned out above 50 cents.
Earlier this year| The current bid offer position is pretty similar to that of February 21 this year, when the bid was at 32 cents. Then there were only 56,766 units on the bid at 32 cents and a small 2.7 million on the offer between 38 cents and 45 cents, with the next offer after that at $3.50. That was weeks before the price shot up to 70 cents on limited volume. This time around, buying is more board based with higher volume on the buy side and the supply just a little more than in February. Clearing the way for continued bullishness, is that supply was taken out below 70 cents although some purchases could be sold back to the market in profit taking having been recently bought at relatively low prices.
Technically, 70 cents looks like the first serious barrier to upward price movement. The next possible resistance would be 80 cents and then $1, $1.35 and $1.60. With supply tight, if the September or December results show much improvement in the bottom-line, there could be sufficient buying interest to move through the lower points between now and the first half of 2015.

Filed Under: Company News, JSE Main Market, Stock Market Tagged With: C&WJ, Columbus International, CWC Communications Plc, Flow

Grace profit up but much work needed

November 8, 2014 by IC Insider.com

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Grace Kennedy’s profit is growing nicely at 21 percent but the nice bump up is due to lower taxation than from normal trading gains. Revenues in the September quarter, rose by the highest level for the year, with an 18 percent increase, against a lower 15 percent year to date, hitting $20.76 billion from $17.56 billion in 2013, for the quarter and $59.28 billion in the nine months to September, from $51.46 billion in 2013.
Pretax profit only grew by 9.5 percent well below the revenue growth, to $1.12 billion from $1.02 billion in 2013 and for year to date, $3.7 billion versus $3.36 billion, a 10 percent gain. Lower taxes helped push net profit up by 21 percent for both the quarter and the nine months’ period, to $704 million from $584 million in 2013, for the quarter, and $2.38 billion from $1.98 billion year to date.
As impressive as the profit gains appear, the sprawling group has much work to do, with annualized return on equity below 10 percent, based on the net profit to date. Management in commenting on the results states “the domestic segment has been focusing on several projects to enhance efficiency, capacity and profitability. These projects include product improvement, more efficient energy utilization and providing assistance to our local raw material suppliers.”
Elsewhere, the acquisition of Le Foods is expected to start the full marketing of the Grace products in 2015, which is expected to deliver higher margins for the group, a spokesperson for the group indicated shortly after they acquired the company, earlier this year.
Margin got squeezed, as operating cost rose faster than the growth in revenues, helping to keep profits down, but Grace’s traditional stream of business lines in foods, have not delivered increased profits so far, in 2014.
Segment results tell an eloquent tale of what happening within the group and the stagnation that exist. The food business that so much hope is pegged on, delivered little increase profit year over year, with the 2014 period delivering $879 million versus $874 million in 2013, in spite of revenues rising 21 percent to $40 billion from $33 billion, in 2013. Banking and finance showed lower results, with a fall to $275 million from $505 million in 2013. The insurance segment recovered from insurance liability adjustment in 2013, to post a profit of $448 million from a loss of $25 million in 2013. The money transfer business has been the star performer for the group with segment profits of $1.64 billion versus $1.35 billion in 2013.
The stock traded at $60 on Friday on the Jamaica Stock Exchange and is priced at a PE around 5 times 2014 earnings which should come in around $12 per share. The net book value is $106 per share, well ahead of the price. There is room for growth for the stock and a buy for medium to long term gains can pay off well. Grace just declared a dividend of 85 cents per share bringing the total for the year to $2.33.

Filed Under: Company News, Company Results Tagged With: Dividends, Grace Kennedy, Jamaican Stock, Le Foods

Dividends at Carreras, Grace & Proven

November 6, 2014 by IC Insider.com

Carreras will be paying another interim dividend of $1.20 per stock unit out of accumulated profits on December 11, 2014, to stock holders on record at November 20.
The stock will trade Ex-Dividend on November 18, 2014.
Grace Kennedy will pay an interim dividend of $0.85 on December 16, 2014 to stock holders on record at November 28, 2014. The stock will trade Ex-Dividend on November 26, 2014.
Proven Investments has advised that a dividend of US$0.0012 will be paid on December 2, 2014. The record date is November 18, 2014 and the X-dividend date is November 14, 2014 and J$0.10 was declared to Preference Shareholders with record date December 9, 2014 and payable on December 23, 2014. The ex-dividend date for the stock is December 5, 2014.

Filed Under: Company News, Dividends Tagged With: Daily Trading, Dividends, Grace Kennedy, Proven

Inside buys into Scotia Group

November 6, 2014 by IC Insider.com

A party connected with Scotia Group purchased 1,250,000 of the group’s shares, on October 15 and a connected party, purchased 1,220,100 of the shares, on September 30, 2014, Scotia Group reported to the Jamaica Stock Exchange.
These are the only two major insider buying, in the group’s stock for this year so far.
The banking group is expected to report full year results towards the end of this month, and announce a dividend at the same time.

Filed Under: Company News, Insider Trades

C&WJ strong mobile growth continues

November 6, 2014 by IC Insider.com

Jamaica, mobile subscribers grew by 125,000 during the April to September period, according to CWC Communications, the parent company for Cable & Wireless Jamaica.
At the end of March, Cable & Wireless Jamaica (CWJ) stated that they had 705,000 mobile customers. The increase since March, puts active mobile customers at roughly 830,000, by the end of September. At the end of June this year, Mobile subscriber base increased by 37 percent with revenue increasing by 34 percent, broadband base increased by 12 percent with revenue up 39 percent. The continued strong growth in mobile customers is resulting in increased revenues for the local company, moving them closer to a break-even point.
CWC Communications in their release of their September quarter’s report that “in our LIME Caribbean businesses, mobile revenue grew 6 percent on a reported basis and 8 percent at constant currency, with Jamaica up 24 percent and continuing to gain market share (5 ppts) as we invest to deliver improved services for our growing customer base. In Jamaica mobile traffic increased by 34 percent and mobile service revenue is up 38 percent at constant currency.”
The stock which traded as low as 25 cents on Wednesday traded 7,481,913 units between 28 cents and 32 cents by Mid day. The change in demand is most likely tied to the news that CWC acquired the Flow operations, which will be seen to have positive implications for CWJ going forward.
CWJ has been BUY RATED by IC Insider from early this year on strong mobile growth and reduced cost.

Filed Under: Company News, General Business News Tagged With: C&WJ, Cable & Wireless, Cable & Wireless Communications PLC

Cable & Wireless Plc acquires Flow

November 6, 2014 by IC Insider.com

Cable & Wireless Communications Plc (“CWC”) today announces that it has agreed terms to purchase 100 percent of the equity of Columbus International, a privately-owned fibre based telecommunications and technology services provider operating in the Caribbean, Central America and the Andean region, for USD1.85 billion.
“The move will significantly enhance CWC’s growth profile and accelerate the progress towards each of its strategic goals unveiled in May. CWC also announced the placing of new shares constituting approximately 9.99 percent of CWC’s outstanding share capital which will be used to finance in part the proposed acquisition. The Enlarged Group is expected to generate significant operating cost and capital expenditure synergies, with additional revenue benefits also available. The transaction will be earnings neutral in the first full year post-completion and materially earnings enhancing in subsequent years” CWC directors stated in their release.
Columbus is a privately-owned diversified telecommunications and technology services company, based in Barbados, with approximately 700,000 residential customers in the Caribbean, Central America and the Andean region. In the Caribbean, it is one of the leading providers of triple-play cable TV and broadband enabled services over its proprietary fibre optic network infrastructure. Through its wholly owned subsidiary, Columbus Networks, Columbus provides backhaul connectivity to 42 countries in the region, as well as capacity and IT services, corporate data solutions and data centre services throughout the Caribbean, Central America and the Andean region. Columbus also provides next generation connectivity and IT solutions, managed networking and cloud-based services under the brand Columbus Business Solutions.
For the year ended 31 December 2013, Columbus had revenue of USD505m with EBITDA of USD216m and total operating profit of USD104m. For the six months ended June 2014, Columbus had revenue of USD284m with EBITDA of USD118m and total operating profit of USD48 million.

Filed Under: Breaking News, Company News, General Business News Tagged With: Cable & Wireless Communications PLC, Columbus Telecommunication, Flow

BNS provides C$109m for Carib hotels’ debt

November 5, 2014 by IC Insider.com

Bank of Nova Scotia decision to shed 1,500 workers globally and close a number of branches, within the Caribbean and Mexico, has led to other developments within the group, in an attempt to recognize areas of potential losses in the worldwide operations.
This had led the bank to record additional loan loss provisions of approximately C$109 million. The amount for “ losses relates, primarily to three existing net impaired loans, within the Caribbean region’s hospitality portfolio. Due to the prolonged economic recovery and continued uncertain outlook. These additional amounts, bring the net carrying value, in line with the expected net recoverable value,” the bankers said in their press release, on Tuesday. There is also an additional amount in the Canadian Banking related to a change in methodology in estimating loss parameters, on the unsecured lending portfolios.
Reports are that the bank plans to shutter 35 branches within the Caribbean region.

Filed Under: Company News, General Business News Tagged With: BNS, Scotia

Guardian Holdings profit up

November 5, 2014 by IC Insider.com

Profits for the nine months to September 2014 attributable to equity shareholders of Guardian Holdings grew 45 percent to TT$286 million or $88 million or over the comparable period last year. The 2014 results to date translate Earnings per share (EPS) of $1.23 compared to $0.85 for the same period last year.
For the September quarter, profit for Guardian shareholders was TT$103 million, an increase of 11.2 percent, from $91.38 million in 2013. The profit position flowed from a 29 percent increase in insurance underwriting activities, in the quarter and 15 percent year to date, but lower investment income for the latest quarter, pulled the grow of profit down.
The 2013 result was negatively impacted by an extra-ordinary loss of $31 million, resulting from the Government of Jamaica restructuring their debt. The 2013 results, when this loss is excluded, would end up with an increase of profits year-on-year of $58 million, or 25 percent.
”Investment opportunities continue to be a challenge and as a result, our investment income fell from $666 million to $602 million, a decline of $63 million. This decline was offset by a favourable movement in Fair Value gains of $100 million inclusive of the Jamaican NDX,” Management stated in their release accompanying the results.
Operating Expenses increased by $34 million or 5 percent, of which $19 million is related to the Pointe Simon project. In 2013, Pointe Simon expenses were capitalised as the project was in the construction stage. The Pointe Simon project consists of an office tower building, condominiums and a hotel. From 2014, in keeping with accounting regulation the expenses relating to the project is booked through the income statement since the project has entered the commercialisation phase. Without this change in treatment, our operating expenses would have increased 3 percent year on year.
Management stated that they “expect to conclude transactions for the disposal of the majority of our condominiums by year end. Demand continues to be good for retail space at Pointe Simon and we have begun the process of signing leases for this space. The sale of the hotel will be concluded by year-end and we look forward to its opening in the latter half of next year. We continue to close a number of small leases in our office tower and are in the process of negotiating two large leases.” The sales of this real estate project will inject funds into the group and provide income and increased profits in the last quarter of 2014 and beyond.
Guardian is listed on the Trinidad & Tobago Stock Exchange and is primarily involved in life underwriting, general insurance and investments management.
Guardian Holdings stocks remains IC Insider BUY RATED.