Another down day for JSE – Friday

The Jamaica Stock Exchange main market closed lower on Friday with JSE All Jamaican Composite Index falling by 795.98 points to 453,102.99 and the JSE Index declined by 723.33 points to 412,740.30.
At the close market activity, the main and US markets had 38 securities traded, compared to 32 on Thursday leading to 12 advancing, 14 declining and 1 closing unchanged.
Trading closed with 2,765,705 units valued $90,660,891 changing hands, compared to 1,977,854 units for $90,864,188 trading on Thursday and the JSE All Jamaican Composite Index lost 1,047.74 points to close 453,898.97 and the JSE Index declined by 952.11 points to end at 413,463.63.
Trading ended with an average of 81,344 units valued at an average of $2,666,497 for each security traded. In contrast to 59,935 units for an average of $2,753,460 on Thursday. The average volume and value for the month to date amounts to 130,615 units valued at $11,557,578 and previously, 137,805 units valued at $13,039,425. Trading for April resulted in an average of 157,923 shares at $3,718,919, for each security traded.
Barita Investments led trading with 549,795 shares accounting for 20 percent of total main market volume, followed by Sagicor Group with 440,087 shares, and 16 percent of the day’s trades and Pulse Investments closed with 281,094 shares for 10 percent of volume traded.
IC bid-offer Indicator|The Investor’s Choice bid-offer indicator ended with the reading showing 3 stocks ending with bids higher than their last selling prices and 2 closing with lower offers.
In main market activity, Barita Investments rose $1.50 and closed at $44.50, with 549,795 shares, Caribbean Cement fell 50 cents to finish at $80, with 43,369 shares changing hands, Eppley gained 98 cents and settled at $12.98, with 205 shares trading, Grace Kennedy gained 30 cents and ended trading of 30,704 shares at $61.10. Jamaica Producers gained 50 cents in trading 1,592 shares to close at $24. PanJam Investment concluded trading of 11,623 shares and lost $1 to end at $90, Scotia Group  traded 109,267 units after rising 69 cents in closing at $50.99, Supreme Ventures  finished with a rise of $2 to close at a 52 weeks’ high of at $33, with 70,840 shares. Sygnus Credit Investments lost 40 cents to close at $12 with an exchange of 53,679 shares and Wisynco Group ended trading of 269,465 shares with a rise of 35 cents to end at $14.90.
Trading in the US dollar market ended with 53,175 units valued at over US$5,496, with JMMB Group  6% preference share concluded trading 490 units at $1.05,  Proven Investments closed trading with 950 units in closing at 23.99 US cents and Sygnus Credit Investments  lost 1 cent and completed trading of 51,736 shares at 9 US cents. The JSE USD Equities Index rose 0.66 points to close at 182.22.

Jamaica Producer’s appetite for acquisitions

Jamaica Producers sale of 30 percent of JP Snacks Caribbean, for  $720 million add to the group’s cash pile for the Group bringing it to just over $6 billion.
The total amount of financial resources provide good ammunition to undertake a sizeable acquisition, locally or overseas.
In an exclusive interview with Jamaica Producers’ Managing director, Jeffrey Hall, IC gleaned that the group has a number of plans under its belt. Hall stated that all their businesses are doing well, but The Group is looking growth opportunities in infrastructure and Manufacturing. The low cost of and abundance of local capital is opening up possibilities for local businesses not seen for a long time, Hall stated. However, the group is not about to take on just about any business.
Tortuga International Holdings Company 62 percent subsidiary of Jamaica Producers is one such acquisition the group did a few years ago. The company manufactures the rum cake for sale with the main target being the overseas residents. The company produces rum cake in Jamaica for all the markets except Cayman suffered a fall in revenues in 2018. Tortuga International had revenues of $879 million in 2018, down from $907 million in 2017, according to the group’s audited accounts. Hall attributes the decline to the effects that hurricanes in the region on tourism traffic to some countries within the region.
“Tortuga will launch Mamajuana Rum Cake in the Dominican Republic in the second quarter of 2019 and Vanilla Rum Cake un Mexico in the third quarter of the year Hall told IC  
Producers delivered $816 million profit for shareholders of the group up from $662 million in 2017 from a 21 percent increase in revenues to $19.6 billion compared to $16.2 billion in 2017, at the same time gross profit rose below the increase in revenues at 16.4 percent. Segment results show JP Foods and Drinks division revenues rising 29 percent to $11.3 billion from $8.8 billion in 2017 and delivered segment profit that rose 36 percent to $378 million while the logistic segment comprising mainly Kingston Wharves grew revenues 11 percent to $8.3 billion for a 26 percent rise in profit $2.7 billion.


Carib Cement wipes off losses

Caribbean Cement delivers record profit in Q1.

Profit at Jamaica’s sole producers of cement soared 234 percent in the quarter to March, to $1.1 billion from just $347 million in 2018 and wiped out the years of losses and plunging it into a surplus of $124 million.
The improved profit grew out of sales that rose a mere 2.5 percent to $4.45 billion from $4.34 billion and reduction in certain cost. The results places the company in a position to be able to commence the payment of dividends that seems likely this year.
Improvement in gross profit margin, was significant and may have resulted in profit margin climbing to 66 percent from 56 percent in the 2018, excluding depreciation cost. Input cost fell with the cessation of imported cement, being a part of the cost mix.
Depreciation cost rose 210 percent, to $391 million resulting from the acquisition of Kiln 5 and Mill 5, previously leased from Trinidad Cement. Employee related cost rose just 2 percent to $554 million. Administrative expenses dropped 73 percent to $300 million from $1.1 billion in 2018, a direct result of termination of the kilns. Marketing and sales expenses declined by 7 percent to $169 million. Finance cost climbed in the quarter by 756 percent to $169 million.

CCC Silo

Earnings per share came out at $1.33 for the quarter. IC is forecasting earnings of $7 per share for 2019, based on sales increasing faster than in the first quarter. On the low end, the forecast is for earnings not less than $6 per share. At the latest price of $64 for the stock, the PE would 10.6 on the high side and 9.2 times at the lower end. It is worth noting that tax losses amounted to $1.6 billion at the end of 2018. Half of taxable profit can be set off against the tax losses, in any year assessment. The effect is a lowering of the amount of taxes to be charged against profit for the year, as the company did not book deferred tax assets for these losses in the past.
Gross cash flow brought in $1.8 billion, but after making loan payment of $1 billion and making some other payments cash at bank on hand, declined to $303 million from $421 million at the end of December last year. Shareholders’ equity stands at $7.5 billion with borrowings at $10.3 billion, down from $11.39 billion at the end of December. Repayment of preference share will consume $822 million in 2019 with $3 billion, payable annually, to September 2026.

Dropped income & increased cost hit NCB

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NCB reports lower profit for 2019 

A fall of $2.3 billion in foreign exchange and investment gains at NCB Financial Group (NCB) was the major factor for a fall in profit in 2019 March quarter to $5 billion from $6.4 billion in the similar period in 2018.
Revenues decline, was not the only area affecting the group’s second quarter performance as a $600 million jump in credit impairment losses and increased depreciation and amortization charge of $430 million, added even more pressure to the results.
For the six months to March, the group reports a net profit of $12.4 billion, down from $13.96 billion in 2018. The 2018 results include a gain of $4.4 billion related to the acquisition of Bermuda based Clarien Group. The amount is partially negated by a gain of $3.3 billion arising from disposal of an associated company JMMB Group, with the amount reflected in the 2019 results. Excluding the one-off transactions the results would have been $9.2 billion for the current period compared to $9.4 billion for the prior year. According to NCB, “we have made significant investments to improve our card system infrastructure, as well as to upgrade our ABM network and core banking system, to enhance and improve overall customer experience.”
Segment results were mostly positive with Retail and SME Banking climbing a healthy 25 percent, Payment Services up 20 percent, Corporate Banking jumping a huge 60 percent but Treasury and Corresponding banking was modestly down by just $12 million. Wealth & Investment banking slipped 18 percent but Life Insurance and Pensions jumped 41 percent while General Insurance leaped 155 percent and other fell 152 percent, for a loss $124 million.
The Group’s most critical area of loans and advances, grew 15 percent over 2018, to end at $384 billion, net of provision for credit losses. GHrowth in loans helped to drive net interest income up by 21 percent from $8.36 billion to $10.15 billion in the second quarter, over the similar period in 2018 and for the six months, a rise of 26 percent to $20 million from $15.9 billion. Non-performing loans amounted to $17.7 billion as at March 2019, up from $15 billion at March 2018 and represents 4.5 percent of the gross loans.
Earnings per share $2.04 for the second quarter and $5.07 for the half year. The group declared a dividend of 90 cents payable on May 27. NCB closed trading at $145 on Thursday on the Jamaica Stock Exchange and at TT$8.25 or J$165 on the Trinidad and Tobago Stock Exchange.

JP sells 30% of JP Snacks to Wisynco

Jamaica Producers former HQ

Jamaica Producers Group and Wisynco Group entered into an agreement that see the transfer 30 percent of the shares in JP Snacks Caribbean (‘JP Snacks’) to Wisynco Group.
JP Snacks Caribbean is a holding company that will own the “JP St. Mary’s” brand and JP’s tropical snack manufacturing operations in which JP will hold the remaining 70 percent of the shares.
“The goal of the partnership is to bring to consumers in Jamaica and internationally, a wide range of innovative Caribbean snacks and tropical foods. Wisynco will bring to the partnership, their expertise in marketing,

Wisynco Group

manufacturing and importantly, their best in class distribution network. The transaction values JP Snacks at $2.4 billion and sees Wisynco investing $720 million for a 30 percent interest, a release from both companies stated.
The release further stated that “the business will seek to strengthen distribution in existing markets in the USA, Canada, the Caribbean, the UK and Central America, in addition to seeking new markets. JP St. Mary’s snacks will continue to be the flagship product line of JP Snacks through its banana, plantain, cassava and breadfruit chips, as well as similar product lines for the Spanish language markets.
Jamaica Producers Group is a Jamaican-owned multinational, with its primary businesses infood and logistics. JP owns and operates the market leading fresh juice manufacturer, supplying

Jamaica Producers to introduce a new line of banana chips.

Holland, Belgium, Scandinavia and other markets in Northern Europe. Through its Tortuga International subsidiary, JP Group operates a Jamaica- based bakery that supplies Tortuga Rum Cake to over 15 countries. JP Group’s logistics interests include Kingston Wharves, the regional multi-purpose port and JP Shipping Services based in the UK. JP also owns JP Farms, Jamaica’s leading banana farm, which is the largest private sector employer in St. Mary, Jamaica.
Wisynco is the maker of WATA, CranWATA, BOOM Energy Drink and BIGGA soft drinks. In addition to its owned brands, Wisynco is the exclusive local bottler for the Coca- Cola Company, as well as third-party beverage brands such as Squeezz and Hawaiian Punch and also distributes portfolios for Red Bull, Tru Juice & Freshhh, Dr. Pepper, Worthy Park Estate, Kellogg’s, General Mills, Nestle and others.

More $$s chased Trinidad stocks – Tuesday

Trinidad & Tobago Stock Exchange Head Quarters

More dollars chased less stocks in trading on the Trinidad & Tobago Stock Exchange on Tuesday with 14 securities changing hands, compared 18 on Monday.
At the close, investors exchanged 218,204 shares at $5,294,306, compared to 372,356 shares at $3,109,288 on Monday. The market closed with 4 stocks rising, 3 declining and 7 remaining unchanged. At the close, 2 securities closed at 52 weeks’ highs and 1 ended at a 52 weeks’ low.
At the market’s close, the Composite Index slipped 0.15 points to 1,331.05. The All T&T Index  rose 0.52 points to 1,767.36, while the Cross Listed Index declined 0.11 points to close at 120.73.
IC bid-offer Indicator|The Investor’s Choice bid-offer ended at stocks with bids higher than their last selling prices and 1 with a lower offer.
At the close of the market, stocks ending with gains| LJ Williams B preference share rose 1 cent to end at a 52 weeks’ high of 90 cents, after exchanging 800 shares, Massy Holdings gained 91 cents and ended at $54, after trading 8,099 shares. Trinidad & Tobago NGL added 10 cents and settled $29.50, with 43,485 units and West Indian Tobacco closed with an increase of 5 cents and completed trading at a 52 weeks’ high of $98.80, with 505 stock units changing hands. 
Stocks closing with losses| Clico Investments lost 3 cents and completed trading at $23, with 78,671 stock units changing hands, Sagicor Financial ended 13 cents lower at $8.66, after exchanging 1,844 shares  and Scotiabank lost 50 cents and closed at a 52 weeks’ low of $62.50, with 16,875 stock units changing hands.
Stocks closing firm| Ansa Merchant Bank ended at $37, after exchanging 2,887 shares, Calypso Macro Index Fund traded 400 shares to close at $14.51, Guardian Holdings settled at $18.50, with 3,612 units changing hands. NCB Financial Group ended exchanging 4,513 shares at $8.25, Republic Financial Holdings closed at $120, after exchanging 1,152 shares, Trinidad Cement exchanged 49,394 shares to close at $2.60 and Unilever Caribbean ended at $26.30, after exchanging 5,967 shares.

Prices of securities trading for the day are those at which the last trade took place.


Profit rises 29% at PanJam

Stephen Facey Chairman & Paul Hanworth Chief Operating Officer

Trading income at PanJam Investment grew a strong 35 percent to $3.26 billion for 2019 while operating expenses rose just 7 percent to $1.7 billion leading to a 66.6 percent increase in operating profit of $1.55 billion, up from $938 million in 2017.
The major contributor to the increase in operating income was a 151 percent increase in investment income to $1 billion, from $423 million in 2017.
Share of results of associated companies contributed $4.7 billion to profit, compared with $3.9 billion in 2017. After taxation of $311 million and finance cost of $624 million, profit ended at $5.3 billion for an increase of 29 percent. Earnings per share rose to $5.06 for the year.
The group saw growth in profit from Sagicor Group and Downing Street Fund 11 and V but suffered a loss at Chukka Caribbean with revenues falling from $4 billion to $3 billion. New Castle saw a reduction in profit even with an increase in revenues while Caribe Hospitality saw profit rising from $242 million to $271 million of which their share is 32 percent.
PanJam holds equity investments worth $6.8 billion up from $2.4 billion at the end of 2017. The value of investment properties moved from $7.9 billion in 2017 to $8.4 billion and investments in associated companies total $26.3 billion. Total assets at the end of the year was $45.9 billion up from $39.4 billion in 2017. The group borrowed $10.6 billion at the end of 2018, up from $7.5 billion in 2017 and has equity of $34 billion.
PanJam is in the process of upgrading the Oceana building in downtown Kingston to a combination of hotel and residential units slated for sale. There also plans for a business hotel in Montego Freeport in Montego Bay.
The group stocks trades at $81 on the Jamaica Stock Exchange at a PE of 12.5 times 2019 estimated earnings of $6.50 and a net book value of $32. PanJam is a stock Investors should consider holding in the long term portfolio to benefit from growth to flow from expansion in the investment field and real estate holdings.

Sagicor’s good profit poor presentation

Jamaica Sagicor Group reports increased 2018 profits.

Financial statements are meant to be understood by users. As most readers are not likely to be trained in accounting, the statements should be prepared in a manner for the average user to understand.
The latest audited financial statement put out by the Sagicor Group and audited by PriceWaterhhouseCoopers includes a profit statement that is a picture of confusion and extremely difficult to understand, that is just not good enough and it should be revamped, for greater clarity. It is just not clear how the statement moves from gross premium income through to investment income and then to total income. To determine what is being conveyed, one has to be fully conversant with computing of income statements and need to decipher what each line item really is and what set of figures relate to what item.
The group recorded total income of $70.7 billion up from $69.7 billion in 2017. The major operation areas generated less income that in 2017. Insurance generated $9.8 billion in 2018 compared to $41 billion in 2017 while investment income fell to $24.3 billion versus $26.7 billion in the previous year. Expenses moved from $55.9 billion in 2017 to just $54 billion in the latest period to December 2018. The reduction resulted from a big decline in movement in actuarial liabilities from $10.7 billion in 2017 to just $2.3 billion in 2018.

Reading the statement one has to guess whether the total cost is that of operating profit or expenses, as there is no caption to clarify. The report then ends up with profit before tax of $18 billion, up from $15 billion in 2017, but readers have to search to determine how the amount, was arrived at. After taxation charge of $4.2 billion versus $$2.9 billion in 2017, the group reported net profit of $13.9 billion against $12 billion in 2017. Earnings per share ended at $3.65 but was boosted by gains of $1.5 billion arising from consolidation of Sagicor Real Estate Fund.
At year-end, shareholders’ equity rose to $74.3 billion from $68.5 billion at the end of 2017 while total assets jumped to $394 billion from $352 billion.

3 + 3 TTSE stocks rise & fall – Monday

Trinidad & Tobago Stock Exchange Head Quarters

Trading on the Trinidad & Tobago Stock Exchange ended with 3 stocks rising, 3 declining and 6 remaining unchanged as the volume and value of trades dropped sharply from that of Friday.
Trading ended with 12 securities changing hands, against 16 on Friday with investors exchanging 81,849 shares at a value of $1,592,860, compared to 582,066 shares for $13,484,840 on Friday.
At the market’s close, Composite Index lost 1.50 points to 1,329.22. The All T&T Index rose 3.16 points to 1,767.94, while the Cross Listed Index rose 0.03 points to close at 120.14.
IC bid-offer Indicator|The Investor’s Choice bid-offer ended at stocks with bids higher than their last selling prices and 3 with lower offers.
At the close of the market, stocks ending with gains| First Citizens concluded trading of 2,271 shares after rising 50 cents to $36.50, Prestige Holdings added 19 cents and completed trading at $7.81, with 500 units changing hands and Sagicor Financial increased 5 cents and ended at $8.70, after exchanging 289 shares.
Stocks closing with losses| Massy Holdings fell 25 cents and closed at $53.05, after exchanging 900 shares, Trinidad & Tobago NGL lost 1 cent and completed trading 8,701 units at $29.49 and West Indian Tobacco shed $1.75 and ended at $97, with 64 stock units changing hands.
Stocks closing firm| Angostura Holdings ended at $16, with 1,050 stock units changing hands, Clico Investments ended at $23, after exchanging 44,666 units, JMMB Group ended at $1.76, in exchanging 15,532 shares, Scotiabank traded 931 stock units at $63. Trinidad Cement settled at $2.60 with 5,000 shares changing hands and Unilever Caribbean concluded market activity at $26.30, after exchanging 1,945 shares.

Prices of securities trading for the day are those at which the last trade took place.

Up to $50m loan to buy Wigton shares

NCB Capital Markets will be providing investors up $50m in margin funding to assit with buying of Wigton’s shares in the IPO.

Investors in Wigton Windfarm initial public offer of shares will be able to access up $50 million in loan financing from NCB Capital Markets (NCBCM) to fund up to 50 percent of the purchase, NCBCM’s CEO Steven Gooden informed IC
The Wigton IPO, is generating lots of interest, amongst Jamaicans, residing locally and overseas and should pull in around $6 billion before expenses for the sellers, PetroJam. It will be one of the larger issues, to hit the Jamaican capital market.
In addition to providing margin funding to assist in purchasing the new IPO issue, NCBCM online portal, dubbed ‘GoIPO’ and created in conjunction with the Jamaica Central Securities Depository , will be available for their investors to use in making application for the shares. The application will allow investors with accounts at NCBCM, to easily fill out application forms as the system will automatically populate the form with the other information for persons with login access codes.
The GoIPO was born out of the major challenges that NCB encountered when they brokered the Wisynco IPO.
Investors with login codes can use them to access NCB system and access accounts that will fund the application. The system will be show the Wigton IPO application from which the appropriate application form is to be fill out. The required information will be the sum being invested. The system will compute the number of shares being applied for and the applicant will identify the account that the funds will come from.

Wigton IPO with propectus expected in a day or two.

Persons having no login code will have go online and fill in name, JSCD account number and TRN and enter the sum they are investing and method of payment as well as upload a photo ID to go with the application.
The new system will eliminate the need to visit a locations to deliver applications and significantly reduce errors associated with manual processing.
Of the GoIPO solution, platform is encrypted, providing security and confidentiality to users, who can access the digital portal once they have a JCSD number. Gooden said, too, that as selling agents of the IPO, NCBCM possesses the largest distribution channel within the broker space and clients who do not wish to apply digitally are encouraged to complete and return their forms to NCBCM locations islandwide.
NCBCM say that investors can apply through the NCB system to apply for shares to go into other brokerage accounts.