Company News — Page 157

Exponential 235m IPO share offer

December 1, 2013 by IC Insider.com

Stock markets were created for the very thing that Exponential Holdings is trying to do, raise funds for a start-up operation.

The company plans to raise $479 million in an offer that opened on November 25 and is scheduled to close on December 9 of this year. Justin Nam, the CEO, says the minimum subscription needed for the listing is 150 million shares of which the founding members will contribute 82.5 million of it.

The company started planning the IPO from 2012 and was delayed until now. Exponential has no track record and the only other start-up to come to the market, C2W Music, has been a disappointment with virtually no income since it was listed in 2012. The recent memory of the music company’s failure to perform could divert some interest from this issue. Exponential is an investment company with focus on identifying what they see as good opportunities in the global market to make money. Unlike the C2W, Exponential can make money from start with funds placed in income earning assets and low overhead cost.

Subscriptions should be for multiples of 100 Shares subject to a minimum of 2,500 Shares. 75 million Shares are reserved for the members of the Founding Team and Team Affiliates at J$2.00 each. If the Reserved Shares are not fully subscribed, they will be available for subscription by the general public.

Application has been submitted to the Board of the Jamaica Stock Exchange for the whole of the issued ordinary share capital of Exponential to be listed on the Junior Market.

The Company incurred certain expenses in respect of office rental, Lead Broker’s mobilization fees, office overheads and consultancy fees paid to Jaїr Minott and André Hartley and are not expected to exceed J$10 million. These expenses were paid, on behalf of the Company, by members of the Founding Team and will be discharged by issuing no more than 5,000,000 ordinary shares to them at the subscription price of J$2.00 per Share.

In addition, the Company has been incurring legal, accounting and financial advisory fees in connection with the IPO transaction contemplated by the Prospectus. It is anticipated that such costs shall not exceed J$20 million. If the IPO is successful, those expenses will be paid out of the IPO Proceeds.

The Company proposes to invest and hold up to 75% of the net IPO funds raised in equities and the remainder in fixed income securities and cash.

Operating expenses | The Company will bear normal office overheads and will pay a management fee in the form of salaries limited to two per cent (2%) per annum of the Average Net Asset Value of the Company’s investment portfolio to the Employee Group led by Justin Nam, who will manage the Company’s investment portfolio and provide all requisite administrative and management services except for accounting and internal audit services. The Founding Team, which comprises the current Directors, will be paid an annual performance fee of twenty per cent (20%) of the amount by which the Return on Opening Equity (expressed as a percentage) exceeds the Hurdle Rate (being the return of the S&P GLOBAL 1200 for the financial year.)

Exponential expects to earn income from dividends and interest paid on the shares and debt securities comprised in its investment portfolio and from trading securities comprised in the portfolio. Absent of untoward events such as market turmoil, the Company expects to deliver net profit in the region of J$62 million to its shareholders for the first full year of operations based on net interest income and other operating revenue of some J$94 million. The majority of this revenue is expected to be derived from realised capital gains on the Company’s equity portfolio, profits from private equity investments and interest income from the Company’s fixed income portfolio.

The prospectus states that each potential investment identified by the management of the Company will be subject to rigorous and careful analysis and will have to be approved by the Company’s Investment Committee before it is added to the Company’s portfolio.

A great deal of success for this company will be dependent on the individuals managing the funds and making the decisions surrounding investing and disposal of investments. The selection and appropriate timing of investing are critical components of success. Nam has a number of years experience both at Dehring Bunting & Golding and at Proven Investments.

Filed Under: Company News, Initial Public Offers, JSE Main Market, Stock Market Tagged With: Exponential Holdings

Eppley preference shares over

November 30, 2013 by IC Insider.com

30th November, 2013 | Eppley Limited announced that a total of 303 applications were received for the recent public offer of 50 million preference shares valued at approximately J$361.95 million.

As the Invitation was oversubscribed, the Company intends to exercise its right to issue further preference shares by allotting 60,325,600 to all applicants who will receive 100% of the amount of the Shares they applied for.

28th November, 2013 | Eppley’s Invitation for Subscription to 50 million Cumulative Redeemable 9.5% Preference Shares at J$6.00 each has been oversubscribed the company reported today.

The offer opened on Wednesday, 13th November 2013 and was closed on the closing date, Wednesday, 27 November 2013.

The Company had reserved the right to make available further Preference Shares prior to the Closing Date but IC Insider understands that this option was not exercised.

Related posts | Profit up 92% for Eppley

Filed Under: Company News, General Business News, JSE Main Market, Stock Market Tagged With: Eppley, JSE Company, Preference Shares

Honey Bun’s profit falters

November 29, 2013 by IC Insider.com

Honey Bun’s last quarter profit got burnt with a $10.5 million loss compared to a small profit of $490,000 for the same period in 2012.

For the full year to August this year, profit fell from $41.5 million to $35.3 million with sales revenues climbing to $712 million from $611 million in 2012. For the quarter, sales rose from $154 million to $163 million hardly enough to cover increased cost. Rising cost and inability to price the products to recover increases in expenses is at the heart of Honey Bun’s 2013 problems that lead to lower profits. For while revenues climbed 14.8 percent for the year, direct cost climbed even faster at 18.8 percent. The increased cost meant $28 million of potential profit just evaporated as a result of not being able to pass on the full cost to customers. Compounding the problem, administrative and other cost rose much faster than revenues by 20 percent to $174 million and selling and distribution cost was contained to an increase of only 8 percent to $90 million. Finance cost at $2.9 million was almost flat.

Image courtesy of dplanet/FreeDigitalPhotos.net

The company may be able to recover some, if not all of the cost increase, during the coming year. Movement in the local currency which would have had a major impact on cost in the 2013 fiscal year should moderate going forward and with signs of stability in the economy and some green shoots of growth showing, the next twelve months should be better for them.

IC Insider is forecasting earnings of $39 million or 42 cents per share for 2014 and 65 cents per share in 2015.

Historical | Gross profit for 2013 increased by 9.7 percent and is the lowest since 2008 when it grew by 12 percent. The gross profit margin for the latest year is not the worst; it is only 2 percentage points below 2011 and well above 66 percent in 2010 and is in line with 2006 and 2007. Profit performance has been less than predictable. In 2007, pretax profit came out at $23 million and decreased to $18.7 million generated in 2008, climbed to $45 million in 2009 but fell to $26 million in 2010 with 2011 enjoying an increase to $37 million; then it was up to $42 million in 2012 only to fall back in 2013.

Finances | Notwithstanding the lowered profited out turn, the company’s finances improved during the year. Shareholders equity improved by $20 million to reach $291 million and borrowed funds was $26 million up from $20 million in 2012. Net working capital increased from $61 million to $98 with cash and bank balances reaching $78 million. Receivables climbed by 40 percent to $78 million and payables by 87 percent to $75 million.

IC Insider outlook | The stock is priced at $3 with a PE of 8 times earnings and is in line with a number of other junior market companies. At best, Honey Bun is currently a stock to watch. It will need increased sales volume to make it to our Buy Rated stock list when compared to others with a better potential for gains.

Filed Under: Company News, Company Results Tagged With: Honey Bun, JSE Company

Blue Power profits continue up

November 29, 2013 by IC Insider.com

Blue Power recorded 33 percent increase in sale revenues to $275 million for the October quarter this year compared to $208 million for the same period last year. The Lumber Depot division achieved sales of $191 million versus $135 million the previous year, an improvement of 42 percent while the Blue Power Soap Division saw sales moving up from $73 million to $84 million for an increase of 15 percent.

Profits for the quarter came in at just over $25 million compared to a shade under $19 million in the same period last year, an increase of 34 percent. The contribution of Lumber Depot contributed over $11 million, improving by 80 percent over the same period in the previous year while Blue Power division added $14 million which was an improvement of 10 percent over the second quarter of 2012. Earnings per stock unit improved from 33 cents to 45 cents in the quarter, an improvement of 36 percent.

Sales grew 18 percent for the six months ended October to $521 million compared to $440 million for the same period last year of which the Lumber Depot division contributed $367 million versus $289 million the previous year, an improvement of 27 percent while the soap division moved up from $152 million to $154 million, an increase of only 2 percent.

Profits increased by 26 percent for the six months to $55 million compared to $44 million in the same period last year. $29 million of the profit for the half year came from the Lumber division for a strong 49 percent increase over the same period in 2012 while Blue Power contributed $26 million which was an improvement of 8 percent. Earnings per stock unit moved from 77 cents to 98 cents in the period, an increase of 27 percent. IC Insider is forecasting earnings for the full year to April 2014 at $2.30 per share and $2.85 for the 2015 fiscal year. The stock remains BUY RATED.

Cost | The group has been able to keep administrative cost under control with figures for the six months showing a slight fall of $1.4 million to end at $62.3 million, while the latest quarter saw a rise of $3.8 million to $34.3 million, a 12 percent increase.

With the shift of increased sales to lumber division, margins shanked in the October quarter to 26.3 percent from 30.3 percent in 2012 and for the year to date 27.3 percent versus 31.2 percent in 2012.

Finances | The group was in a strong position at the end of October with cash funds $126 million, which is down from April’s $145 million, but more funds are now reflected in receivables and inventories which are up by $30 million and $22 million respectively. At the same time payables declined by $11 million. Shareholder’s equity rose to $392 million at the end of the latest quarter.

Blue Power is an IC Insider Buy Rated Stock

Filed Under: Company News, Company Results Tagged With: Blue Power, JSE Company

Teas profit up 32 percent

November 27, 2013 by IC Insider.com

Jamaican Teas just reported a 32 percent rise in profit for the year to September from a 49 percent jump in sales. The company earned profit attributable to the group’s shareholders of $99 million for the year versus $75 million in 2012.

For the last quarter, the group reported profit of $23 million compared $6.2 million in the similar quarter in 2012. The results for the quarter reflect the booking of revenues resulting from the completion of the real estate development and sales of all but two of the units. The 2012 last quarter figures were negatively affected by an adjustment for impairment to an investment amounting to $9 million.

Sales up | The Group recorded improvement in sales for the year increasing by 49 percent to $1.23 billion versus $824.5 million in the prior year. This was due to mainly increased supermarket sales, a strong 46 percent growth in export sales and income from sale of units in the real estate development.

While sales for the manufacturing division were up 26 percent for the year they were only up 5 percent for the latest quarter partially due to flat exports, which was affected by the termination of the sale of coffee that was included in last year’s figure while there were none in the latest quarter.

Image from Behance.net

The sales performance was also helped by Caribbean Dreams’ Jamaica Blue Spring Water, which was introduced shortly before the commencement of the start of the fiscal year.

Sales at the Kingston supermarket in last quarter were up on the similar quarter in 2012 by 15.8 percent and up by 20 percent for the financial year.

Investments | The group holds $140 million including stocks and bonds and generated income of more than $30 million from them during the year. The amount is a part of other income which amounted to $40 million versus $23 million in 2012.

The group absorbed losses of $4.8 million in the latest quarter for the associated company that operates a supermarket in Montego Bay and a loss of $11.3 million versus $8.4 million for 2012. The company made $2.5 million adjustments to differed tax assets during the year based on the change in tax rate to 25 percent thus increasing the loss for 2013 by that amount.

Cost increase | Administrative cost rose by 20 percent to $86.5 million and distribution and marketing cost rose 69 percent to $30.4 million. The admin cost rise is partially due to the booking of the full year’s cost for the supermarket in Savannah La Mar versus only part year cost in 2012 and increased labour cost. Finance cost rose from $8.36 million to $11.3 million due in part to increased borrowings to fund the real estate development and the acquisition of the new factory building.

Statement of Financial Position | Inventories increased mainly as a result of increased cost of inputs and the cost of inventories at the supermarkets due to rising local cost flowing primarily from the devaluation of the Jamaican Dollar. The receivables rose sharply due to pending completion of sales for the apartments sold and increased export sales, especially the last two months of the financial year, causing in the total due from overseas’ customers to rise.

Borrowings | Borrowings jumped from $113 million in 2012 to $245 million at the end of 2013 financial year but this was effectively $162 million as $83 million represented a loan that was kept as a bank deposit for a short time after the year end. The increased borrowings related to the development of the apartment complex and funding of the purchase of the property to house the factory for the manufacturing operation. Subsequent to the year end, most of the short term borrowings were either paid off or converted into long term loans. The amounts used in the funding the construction of the apartment complex were fully liquidated after the year end. Jamaican Teas issued 5 year bonds amounting to $105 million, fixed at 8.5 percent for two years after the balance sheet date. The funds will be mostly used to fund the company’s next real estate development. At the end of the year, shareholder’s equity stood at $596 million, a $85 million increase over 2012.

Outlook | “We expect to build on the foundation created to date. New lines were recently added that will positively impact sales and profit in the new fiscal year. We expect that our latest real estate development planned for St Thomas will contribute positively to profit during the year. Our expectations are that export sales should continue to perform well and so far the local market seems to have stabilized.” Management stated in their release to shareholders.

If the company successfully executes the new real estate development and sales in the other segment continues to grow at close to that of the last year, then the group should go on to see another record year of profit in 2014.

Jamaican Teas is an IC Insider Buy Rated stock.

Filed Under: Company News, Company Results Tagged With: Jamaican Teas, JSE Company

Derrimon Trading, high risk low returns

November 26, 2013 by IC Insider.com

Derrimon Trading Company is a name not known to the vast majority of Jamaicans but that may change if the company succeeds in raising just over $150 million from a public issue of shares in December.

A cursory look at the company’s finances quickly indicates why it needs the infusion of funds; margins are low at around 10 percent and working capital is weak with the current assets ratio at 1.2:1, which is considered very weak and well below a 2:1 ratio. Unfortunately, the new capital while it will improve the ratio, will not be enough to lift it to where it should be.

Cost continues to grow sharply with Admin up 30 percent to August this year and selling and distribution up 25 percent. These compare with revenue growth of just 13 percent. Quite a bit of profit is coming from other income including investment and rental amounting to $21.8 million in 2013 and $24 million in 2012 to August and $36 million for the 2012 calendar year to December. Before interest cost, the main operations reported a $9 million profit. Admittedly, this is after making provisions for inventory loss of $18 million and doubtful debt provision of $9 million.

In 2012, the supermarkets had gross profit around 20 percent but the distribution margin was only 7 percent and wholesale 11 percent. Revenues with low margins make up 92 percent of sales in 2012. The average number of persons employed full-time by the Company during the year was 135 (2011 – 96), while part time employees averaged 17 (2011 – 14). Cost relating to staff rose from $96.76 million in 2011 to $146.5 million an increase of 51 percent with the staff numbers going up by 38 percent.

Profits | Financial statements to August show profit of $51 million pretax and $35.7 million post tax or 18 cents per share, annualized around 25 cents. Gross profit margin is just over 10 percent for 2013 up from 8 percent in 2013 for similar period and 9.5 percent for all of 2012.

The company reports profit for 2008 to 2013 rising from $8.4 million pretax profit in 2008 to $8.1 million in 2009; $17.5 million in 2010; $36 million in 2011 and $25.3 million in 2012. While there was big foreign exchange gain in 2011 there was a big loss in 2012. Revenues have moved rapidly upwards from $807 million in 2008; it reached $1.48 billion in 2009; $2.46 billion in 2010; $3.35 billion in 2011 and $4.76 billion in 2012. The rapid rate of growth seems to have slowed in 2013 with sales of $3.756 billion to August, versus $3.32 billion for the same period in 2012, a 13 percent increase compared with 43 percent in 2012 and 36 percent in 2011.

Tax free | As a junior market prospect, profit will be tax free for 5 years if listed. Hence, the valuation should be based on pretax profits. For 2013 excluding tax, earnings would be in the order of 32 cents per share assuming no major negative development occurs in the last 4 months of the year to reduce the level of profitability. Using Lasco Distributors with a PE ratio around 7 as a guide, we would price the stock around $2 each, just about the issue price to the public. Paramount Trading may even be a better guide with a PE of 5 times earnings, which would place Derrimon stock price value at $1.80. These numbers suggest that investors should not be running for this one looking for any potential gains in the short term. At best, it will be in the future.

The 73,336,067 ordinary shares that are available will not see much going into the public’s hands with an allocation of just 8,568,486 shares. Board Reserved Shares amount to 25,693,590, which has been effectively taken up by the conversion of loans made to the Company amounting to $52.67 million. Others include Employee Reserved Shares: 4,878,049; Key Partners Reserved Shares: 12,195,122 and Mayberry Clients Reserved Shares: 22,000,820. The Invitation will open at 9:00am on Monday, 2nd December and is slated to close at 4:00pm on Monday 9th December 2013. Applications from the general public must request a minimum of 2,000 shares and be made in multiples of 1,000.

About the company | Derrimon Trading was founded in 1998 by Derrick and Monique Cotterell. The business began to grow in earnest in 2002, when the Company was appointed as a regional co-distributor of Nestlé Jamaica for Kingston & St Andrew, St Catherine and St Thomas. In 2009, the Company acquired the business of Sampars Cash and Carry, one of the largest wholesale businesses in Kingston in order to increase the portfolio of products and to extend its market reach. More recently, the Company has introduced a line of exclusive branded products under the ‘Delect’ name. The new range includes rice, canned mackerel, tomato ketchup, vegetable oil, cornmeal and other products.

Since 2009, the Company’s operations have been based at its principal premises at 235 Marcus Garvey Drive. This location provides the Company with 100,000 square feet of warehouse facilities including cold storage over some 3.5 acres of property, which is strategically located close to both Kingston Wharves and key distribution routes to the Company’s various markets. In support of its operations, the Company engages a contracted fleet of over 60 delivery trucks to deliver the Company’s products to customers.

Use of proceeds | The company says it intends to use the proceeds of the Invitation for the following purposes:

Expansion of Sampars business, with further wholesale and retail outlets;
Enhancement of the Company’s wholesale/retail business software platform;
Provision of working capital support to the Company’s distribution business;
Retirement of a portion of the Company’s debt, including certain Directors’ loan;
Pay the expenses of the Invitation out of the proceeds, estimated not exceed $9.5 million.

Directors | Executive Directors: Derek Cotterell (Chairman), I. Kelly (Finance), W. Thomas (General Manager). Non-Executive Directors: Monique Cotterell, Earl. A. Richards, Alexander Williams.

A number of the directors has had several years’ experience with Grace Kennedy in the distribution business.

IC Insider outlook | At the current state of the local stock market, this one seems to be better watched from the side lines than on the field of play.

Filed Under: Company News, General Business News, Initial Public Offers, JSE Main Market, Stock Market Tagged With: Derrimon Trading, Sampars

Jamaican Teas lists corporate bond

November 25, 2013 by IC Insider.com

Monday, 25th November 2013 | Tanisha Samuels, Assistant to CEO John Mahfood, inserts the Jamaican Teas fixed & variable rate banner in the slot on the Jamaica Stock Exchange board prior to the start of trading today. To her left is the John Mahfood, the company’s CEO.
In today’s trading 1,000 units traded at $99.50 per 100 units.

Related posts | Jamaican Teas raises over $100m

Filed Under: Company News, General Business News, JSE Main Market, Stock Market Tagged With: Jamaican Teas, JSE Company

New additions to Buy Rated stocks

November 25, 2013 by IC Insider.com

Monday, 25th November 2013 | There are two additions to the Buy Rated and Market Watch list for the coming week. Added to the Buy Rated stock list is Jamaican Teas due to a 30 percent gain in profits for the year ended in September flowing from a 46 percent jump in export sales, sales of apartments in its first real estate development and expectation of further growth in 2014.

Carreras is added to the Market Watch list based on IC Insider’s assessment for earnings around $5 per share for the current fiscal year and dividend yield above 10 percent. Trading in the mid $30’s, this stock has a very good chance to head back into the mid $40 range.

Performance tracking | During the past week, a few of the Jamaican stocks made some recovery with JMMB breaking even in Jamaica but has retreated in Trinidad. Access Financial is up 15 percent so far but Lasco Financial and Manufacturing are still off by good margins. The selections in the main market remain mostly under water, but the ideal time to buy may be slipping away as prices seem to be at their bottom. More importantly, there are indicators that a year-end market rally will happen again in December.

While Jamaica has disappointed, the same can’t be said about Trinidad. There are only two losers so far; Guardian Holdings and Scotia Investments. During the past week Neal & Massy, that had declined below the price at the time of selection, has bounced back from its low to be just slightly ahead at the close on Friday.

What seems clear, is that the focus ought to be on longer term performance rather than just short term gains. The Trinidad market performance of slow price movements illustrates this very well. There are also signs in the Jamaican market suggesting the same, the major difference being the Jamaican market is more aggressive with price movements.

Filed Under: Company News, JSE Main Market, Stock Market, TTSE Market Tagged With: Carreras, Jamaican Teas, TTSE

Carreras down but not out

November 22, 2013 by IC Insider.com

Carreras, the dominant cigarette distributor in Jamaica. is reporting lower profit from operations for the September quarter as it did for the June quarter as revenues fell from the 2012 levels even as the company had a price increase earlier this year.

Revenues plummeted by 25 percent for the six months period declining from $5.76 million to $4.4 million and by 16 percent in the second quarter from $2.67 billion in September 2012 quarter to just $2.24 billion; this is a big improvement from the 30 percent decline in the first quarter. The reality is that with a price hike of 17 percent in March, a sharp decline in volume is expected. This has always been the case in the past so there are no reason to think that it would be otherwise this time around. The situation is made worse by the stock piling of cigarettes by the trade in anticipation of the price hike.

Profit after tax was identical in both the June and September quarters at $485 million each; the profit for the six months fell 33 percent excluding the pension refund of approximately $2.5 billion net of tax in 2012. The interesting development is that gross margin improved to more than 100 percent from 90 in the similar period in 2012 and 86.5 for all of the 2013 fiscal year.

The smoking ban which was announced on June 25, immediately impacted the stock price influencing the pull down from $56 to $52.50 on the next day. Although the price recovered to the $55 level shortly thereafter, it slowly drifted to $50 by the end of July, prior to the results being released for the June quarter. The fall in profit seems to have pushed the stock price down to $35 to better equate the value with the lower profit and dividend payment. At the $35 level, it is gaining some support.

The price increase earlier this year had a negative impact on the company’s consumers took a big bite out of sales, far greater than any impact the smoking ban may be having. Sales enjoyed a big jump in the last half of 2012 up to the March this year suggesting that distributors stocked up on the product in anticipation of price increase and stopped stock piling once the price adjustment was implemented.

Expenses rise | While revenues plummeted, expenses have not, with sales & marketing going up by a third to $207 million from $152 million and rising by a smaller 22 percent for the half year to reach $415 million. Administrative expenses, which increased by 15 percent from to $320 million was up 19 percent to $634 million for the six months period.

Tax Recovered | The tax now recoverable that was down to $1.4 billion at June from $1.733 billion at the end of March, is now at $1.17 billion. If the tax authority continues to allow recovery against current liability then the full amount could be recovered before the end of the 2015 fiscal year and most likely be distributed as dividends to shareholders.

Carreras ended up with cash funds of $3.4 billion at the end of September, equity is at $3 billion or $6.30 per share. Current liabilities are at $2.67 billion which includes tax payable of $1.5 billion against current assets of $4.3 billion. There are no borrowed funds incurred to fund operations.

Carreras cut the quarterly dividend from $150 paid last year to $1 in light of the profit decline.

Outlook | Our forecast is for earnings to hit around $5 per share this current fiscal year, and if so, then the stock would be a reasonable buy around $35, the current price level. With a dividend yield of more than 10 percent before tax, the stock will be an attraction for income seeking investors.

Image courtesy of Scottchan/FreeDigitalPhotos.net

Filed Under: Company News, Company Results Tagged With: Carreras, JSE Company

Will Tessanne boost RJR fortunes?

November 19, 2013 by IC Insider.com

Important RJR update | RJR earnings per share for the six months improved to 4 cents compared with a loss of 6 cents in 2012. IC Insider has revised its forecast of earnings and is now forecasting 20 cents per share for the full year ending March 2013 and around 30 cents for 2014, which suggest that the price of the stock has room for growth from the current level of $1.34. It is quite possible that the group could be a big beneficiary of the popularity of Tessanne Chin’s success on the NBC The Voice with RE TV’s broadcast of the program, especially if Chin goes much further in the competition.

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RJR recently released results for the six months to September, but they have the exclusive rights to the telecast of the NBC The Voice program that features Tessanne Chin and is being telecast locally on RETV. Could she give the stalled bottom line a real kick in the butt? The next quarterly figures will shed some light on that.

The economic environment has not been kind for many in the communication sector. We have Cable & Wireless losing market share from high legacy cost, complacency and poor customer service plunging the operations in to huge losses stretching back for a number of years, then there is the staid and age-old Gleaner Company whose main business has not seen a profit for some time as both the state of the local and global economies has conspired against it, pushing up cost without a commensurate level of income.

Then there is RJR who raised capital to invest in a newspaper only to write-off all of it, plus their own old-fashioned management practises in some areas that has seen the once prominent and dominant AM radio loose its dominant market share. They are now fighting amongst the rest try to recoup market share from the new leader, Irie Radio.

Interestingly, all three of these companies were once very dominant in their respective markets but not so any longer. What went wrong and where will they be heading?

The un-audited results showed that RJR recording a profit in the 2nd quarter ended September, 2013 of $13 million and marginally more for the six month a profit of $14.6 million, which is a major turnaround from a loss of $23 million in the 2012 six month period and a small profit of $2.3 million in the 2012 September quarter.

Revenues | Operating revenues were down $21 million for the September quarter to $458 million but was flat for the six months at $899 million. Other Income showed a 63 percent increase for the six months to $52 million and 19 percent increase for the quarter to reach $17.5 million, resulting management said, “from new transmitter site rental income.”

The 2nd quarter performance was driven by a $29 million or 5.9 percent reduction in expenses for the comparative period in 2012 moving from $489 million down to $460 million.

Direct expenses fell $14 million to $212 million for the quarter and but was up $30 million for the six months; selling expenses were marginally down $2.6 million for the quarter and $9 million for the six months while administration expenses fell by $18 million to $84 million and by $21 million for the six month period to reach $183 million. Finance costs rose from $3 million in the six months to $11 million.

Earnings per share | RJR earnings per share for the six months improved to 4 cents compared to a loss of 6 cents in 2012, IC Insider is forecasting 13 cents for the full year ending March 2013 and around 20 cents for 2014, which suggests that the current price of the stock is fully valued at $1.30. It is quite possible that the Group could be a big beneficiary of the popularity of Tessanne Chin’s success on the NBC The Voice and could be a big boost for RETV. Management has also mentioned a new project that should be on stream before the end of the fiscal year but no details have been given.

At the end of September, there was $84 million invested in FIFA rights to broadcast and televise World Cup matches in Jamaica; $446 million of receivables or nearly one quarter’s revenues; cash funds of $230 million and payables of $223 million. Shareholders’ equity stood at $1.2 billion and long term loans increased by $226 million.

Photo courtesy www.nbc.com/the-voice/

Filed Under: Company News, Company Results Tagged With: JSE Company, RJR