100th listed company for Jamaica Stock Exchange

Jamaica Stock Exchange Junior Market will soon have its 46 listed company on its board soon, and the 100 listed company on the overall exchange, with the latest offering to the public set to open on August 12 and comes to market, solidifying and highlighting the change taking place in Jamaica’s economy where a young team of individuals with a bright idea can raise funds in the market with minimal fixed assets.
OneonOne Educational Services comes to market the prospectus states to sell 380 million shares to raise around $359 million net of cost. In reality, the issue is really for 271 million shares if the lenders convert their loans to shares. Only 121.25 million will be available to the bulk of applicants as the rest is earmarked for selected groups including 108.7 million due to investors currently holding convertible loans as such no new funds will be coming from this group of investors resulting in just $279 million in fresh capital being raised before expenses estimated $30 million. The offer will raise the number of issued capital from 1.52 billion shares to 1.9 billion.
The company has a lot in common with the recent listing of EduFocal both being in the education area using technology to deliver the service to customers thus keeping cost low and profit margins high, but it is more slanted currently in serving the corporate sector. The company that started operating in 2015 is highly profitable and benefitted from the lockdown of the economies in the Caribbean region in the aftermath of the discovery of covid-19 that resulted in schools and many businesses being closed or operating at a lower capacity.
The service is a fully remote educational technology which delivers personalized education primarily to enterprises, governments, and individuals across the Caribbean and Latin American region. The company appears to be a provider of technological infrastructure for itself and clients as opposed to be the primary supplier of learning information, as opposed to what the name suggests. In keeping with the change in service offering, the name seems set to be changed from that of educational services to one that is less restrictive in perception.
The founders have been able to win the support of some heavy hitters within the business community, with Michael G. Bernard, former CEO of Carreras holding the position of Chairman, Douglas Orane as the mentor.

Ricardo Allen CEO of One to One

The Company was founded by Ricardo Allen, Rory White, Stephen Barnes and Christopher Rochester, to deliver large-scale personalized education through the utilization of advances in learning technology which employs sophisticated statistical algorithms, the prospectus states. They were later joined by R. Danvers Williams, Michael Bernard, Douglas Orane, John Bailey, Ian Forbes and the C.B. Facey Foundation and Sagicor Group through the Sagicor Sigma Funds.
As the date of this Prospectus, it is the intention of the Company to use the proceeds to further capitalize on the demand for its services across the region and to deliver on key long-term strategic contracts by continuing to invest in software development to meet the demand for their services.
In the past, the company provided contracts that involved one-time income and recurring annual income that have an average contract length of three years – which continued to generate revenues in 2021 along with a new product “Class-room in a Box” to provide offline content to individuals and schools. As of August 2021, 63 percent of the Company’s revenue was gained through these Business to Business contracts, and 37 percent through the Company’s end user consumers business line.
For the financial year 2020, a net profit of $55.4 million was generated compared to a loss of $9.7 million in 2019. The increase in profits the company states was due to new contracts acquired in response to the COVID-19 pandemic by providing services to the education sectors in Jamaica and other Caribbean territories. For 2021 net profit increased 21.75 percent to $67.5 million over 2020. The Company says it was able to negotiate long-term contracts with clients which provide stability in revenues.
Revenues moved from $27.8 million in 2017 to $269 million in 2021 with the latter rising a significant $104 million over the $128.5 million in 2020. Revenues for 2019 ended at $36 million. For the nine months to May this year, revenues rose 24 percent to $194 million over the similar period in 2021, with a profit of $49 million pretax, up from $15 million in 2021.
The company projects revenues to hit $334 million by the end of the financial year to August with pretax profits of $105 million which would equate to earnings per share of 6.9 cents, with profits being free of taxation when listed on the Junior Market. The company states that the projected fourth quarter revenue $140 million includes existing contracts that are scheduled to produce $101 million in revenues over the 3-month period to August 2022 and an additional $39 million in revenues which is expected from the conversion of deals that are within the sales pipeline, from all indication the company seems on track to achieve this target with the fourth quarter appearing to reflect seasonality in revenues.
The earnings work out at a PE ratio of 14.5 just above the market average of 12.9 Based on where recent IPOs are valued investors can look for a price after listing around $1.50 but investors have priced many of them closer to 30 times 2022 earnings in which case a price of $2 is not out of the reckoning.
A highly welcomed feature of the prospectus is the projected income statement that shows figures to the 2025 fiscal year. Looking further ahead, the Company projects to retain $160 million in current contracts and recurring users, representing 37 percent of 2023 projected revenue, which suggests revenues of $433 million and a profit of $141 million for earnings per share of 7.5 cents with a PE of 14.2. For the fiscal year 2025, revenues are projected to reach $662 million, with a profit of $180 million, but the outcome may be vastly different than forecast. The forecast ICInsider.com gathers may be conservative, with junior market IPO candidates in the past enjoying a big jump in business flowing from the publicity associated with the IPO. ICInsider.com expects the IPO will provide a bounce to the company’s business.
Negatives, at the end of May, receivables amounted to $127 million 65 percent of revenues or close to eight months of revenues, which is not good and could lead to a high level of bad debts in the future, there are no comments in the prospectus to explain the high level of debt due, but the audit statements shows very little provision for expected credit loss, suggesting that management and the auditors consider the amounts to be collectable. Information gleaned by this publication suggests that there is an amount of around $60 million of the amount that the payment is differed based on certain conditions being met.
Another negative is amounts due from directors of $22.5 million, which is up from $14.5 million in August 2021 and $8 million in 2020, has increased each year since 2017 when it was at $994,627. The audited financial statements state that the amount “is unsecured, interest free and have no fixed repayment terms.” The income tax law will treat these amounts as liable to taxes as they could be regarded as a distribution, there is no indication of arrangements that are in place to have the amount repaid mentioned in the prospectus.
ICInsider.com does not see the reason for the loans being converted to shares being a part of the IPO rather than for the shares being issued prior to the IPO and therefore reflects a more publicly acceptable picture of the wider public getting a higher percent of the issue than how it is currently presented. All of the above presents a picture to the discerning public, a view of a board with the majority being young and inexperienced and a sign of weakness going forward if not addressed early.
The directors of the company are Michael Bernard, chairman, Ricardo Allen, John Bailey holds a University of South Florida MBA degree in Business Administration, Karen Vaz has a BA degree and is vice president of HR and Information Technology at PanJam Group, Andrew Tyrone Wilson has BSC in Banking and Finance, Mischa McLeod-Hines has an MBA degree and is Vice President Capital Markets – Sagicor Investments and Andrew Dr Carol Granston, Instructional Designer and has served in the field of Education and Training for over thirty years.
The listing of the shares will be within a week from the closing of the issue. The broker for the offer is Sagicor Investments.

Dolla list Wednesday

The shares of Dolla Financial that was the subject of an Initial Public Offering will be listed on the Jamaica Stock Exchange Junior Market on Wednesday morning after increasing the number of shareholders to 14,981  as a result of the IPO.
The stock offered to the market at $1 each was heavily oversubscribed, with investors getting around four percent on average of the shares applied from the Public Pool. This publication expects moderate trading on the opening day with the price set to hit $1.30 but should see pretty spirited trading on Thursday when the price could well exceed the usual 30 percent one day limitation for price movement.
Around 40,000 applicants were received for the issue, of 500 million shares, information gleaned from persons close to the issue. The trading symbol will be Dolla, the same as the name.

Public gets few Dollas for their effort

Public stock issues continue to deliver miniscule amounts to investors, but more so for those who are not accorded preferential status by the offering company.
The latest IPO by Dolla Financial falls well into the above category with the general public getting up to 10,000 shares plus a pro-rata allocation of approximately 2.50 percent of the excess shares for which they applied, this contrast with applicants in the Key Partner Reserve Pool who will receive a full allotment.
At the same time, applicants in the Company Reserve Pool will receive up to the first 8,500,000 shares, plus approximately 2.49 percent of the excess shares which was applied for above the Company Reserve Pool Base Allotment.
Refunds for amounts in excess of the cost of allotment will commence on June 8 and will be made to the broker account provided by applicants.

Dolla shares could list on Friday

Add your HTML code here...

Trading in the shares of Dolla Financial that offered shares to the public in an initial stock offering that closed on the same day it was opened could be listed on Friday on the Junior Market of the Jamaica Stock Exchange, a source informed ICInsider.com.
Details of the allocation are expected to be released by the close of the Jamaica Stock Exchange on Monday, the source advised.
Some $10 billion is said to have chased after the 500 million shares at $1 each, as such investors will end up, on average, with approximately 5 percent of the amount applied for.
The issue that was very popular closed at 4.30 on Friday, May 27, having been heavily oversubscribed. The shares are expected to more than double, based on the earnings for the first quarter to March this year, with a profit before tax of $66 million, up from $17 million in 2021.
The company reported an audited profit of $129 million after taxation of $38 million for 2021, from revenues of $379 million and ended with shareholders’ equity of $315 billion.
$250 million of the funds raised in the offer, net of the cost of the IPO, will be used in the business to fund loan growth.

Institutions losing out big time in stocks

The Jamaica Stock Exchange Junior Market is growing at more than twice the pace of the Main Market but institutional investors are missing out on the significant superior performance the newer market is delivering, all because institutional investors have not been reading the Junior Market properly, the end results are, pension funds and other investors who utilize institutions to manage their funds have lost out big time on the returns the newer market has provided.
But a host of newer investors are having a whale of a time making good money in the more investor friendly market. These newer investors are mainly interested in Junior Market stocks, two observers disclosed to ICInsider.com. The burst of new investors were attracted to the market by initial public offers of mainly Junior Market stocks, fed on a dose of wildly successful issues that they made great profits from. They are familiar with the market for new issues as they have done extremely well out of them and plan to do so until the situation changes.
In the summer of 2011, just 1,339 applications pumped in $2.4 billion for Caribbean Producers public share issue. Recent issues have attracted over 5,000 applicants, with Spur Tree pulling in excess of 5,000 investors. In 2018 the Fontana IPO attracted 3,406 applications for a total of 982 shares at $2 each. In 2018, Indies Pharma pulled in 2,800 applicants, covering over $1 billion and Wisynco hauled in 7,382 applications totaling $18.8 billion. These are in contrast to the first Junior Market listing Access Financial which struggled to get acceptance at the IPO stage.
A close look at the markets and individual stocks in recent months tends to confirm this view. It is not very surprising then that the Junior Market that has seen a number of new listings in the past three years has attracted sufficient buying interest to send that market up nearly 30 percent last year and up to 33 percent up to recently in 2022, far surpassing Main Market stocks. That performance is not unique to the past two years as the Junior Market outpaced the Main Market in 7 of the last 12 years and delivered more than twice the gains as the Main Market. The Junior Market gained 984 percent from the end of 2010 up to last week with an increase of 119 percent more than the Main Market’s 449 percent.

$10 billion chased Dolla IPO

Some $10 billion is said to have chased after the 500 million shares at $1 each, offered in the Initial Public offer in Dolla Financial from approximately 10,000 applications, ICInsider.com has been advised by persons who would be in a place to know.
This could mean that each applicant may end up with an average of approximately eight percent of which they applied if over 40,000 shares.
The issue that was clearly very popular and oversubscribed closed at 4.30 on Friday, the same day of opening.
The shares are slated for listing on the Junior Market of the Jamaica Stock Exchange and are expected to more than double based on the earnings for the first quarter to March this year, with profit before tax of $66 million up from $17 million in 2021 and the high level of oversubscription.
The company reported an audited profit of $129 million after taxation of $38 million for 2021, from revenues of $379 million and ended with shareholders’ equity of $315 billion.

Dolla IPO oversubscribed and closed

The Initial Public offer of shares in Dolla Financial was oversubscribed and closed at 4.30 on Friday, the same day that the issue opened.
The issue comprised 500 million shares of $1 each with the shares slated for listing on the Junior Market of the Jamaica Stock Exchange. A very popular issue that is expected to be heavily oversubscribed, with the stock expected to more than double based on the earnings for the first quarter to March this year, with profit before tax of $66 million up from $17 million in 2021.
When listed it will bring the total Junior Market listings to 46, with three listings for the year to date and the total number of ordinary shares to be listed on that market to 50, with one failure and three migrating to the Main Market.

$1 for Dolla IPO

The latest IPO for a Junior Market listing is now out, with Dolla Financial Services, a company that is involved in the business of short term lending, with is set to sell 500 million Ordinary Shares at $1 each to the public, with the offer including  250 million newly issued Ordinary shares and the sale of 250 million existing Ordinary Shares by the Selling shareholders.
The 2021 financial statements show a total income of $395 million and a profit of $168 million before tax. Currently, the number of issued shares is 2.25 billion units, with earnings per share of 7 cents per share. Results for March 2022 show revenues of $141 million compared to $64 million in 2021, with a profit of $66 million, up from $17 million in 2021. For the full year earnings should hit the $300 million mark with earnings per share of 20 cents per share with a PE ratio of 5, compared to 13 for the overall Junior Market.
The Company intends to use the anticipated proceeds of the invitation of $250 million to expand its loan portfolio regionally through acquisitions and organic growth and strengthen its capital base. It currently operates eight branches in Jamaica and one in Guyana and has an equity base of $373 million, the issue if successful will take equity to just over $600 million.
The issue opens on May 27, 2022. Victoria Mutual Wealth Management, the receiving agent for the purposes of the Invitation.

JFP IPO pulls in 5,062 shareholders

Following a successful initial public offer of 280 million shares that were offered to the public to raise $280 million by JFP Limited a décor and furniture manufacturing company, amassed a total of 5,062 shareholders following the public issue.
The company was listed on the Junior Market of the Jamaica Stock Exchange and Monday brought the total listings on the market to 44, the number of listed companies to 43 and the listing of companies on the exchange to 97 companies.
“The JFP could not be listed without the work of its founder Stephen Sirgany and the staff of JFP, who worked tirelessly to ensure that the Company is what it is today and to achieve the status of being listed on the Board of the Exchange,” Metry Seaga, Chief Executive Officer stated in his address at the listing ceremony.
“I want to encourage SMEs to stay the course, overcome the hurdles and you will be able to achieve great results, such as listing on the Board of the Exchange,” JFP’s CEO advised.
“The markets have been busy creating millionaires and we are happy that the Jamaica Stock Exchange could have provided the facilities for persons in Jamaica to create wealth. Companies are creating wealth through JSE’s facilities. Jamaicans don’t have to sit on the sideline and watch these companies create wealth, but they can now share in the whole process”, Ryan Strachan, VP Investor Relations at GK Capital Management Limited, the Lead Broker, stated in addressing the audience.
The stock that was issued at $1 each traded on Thursday morning at $1.91 for a gain of 91 percent over the issue price.

Edufocal lists on Tuesday

Trading of shares in EduFocal that offered 129,689,219 ordinary shares to the public on March 3, will commence on Tuesday as the company shares will be listed on the Jamaica Stock Exchange Junior Market on that day and will bring the total listings on the market to 45.
The offer was oversubscribed, with Key Strategic Partners in this reserved pool will receive all their predetermined amount.
Applicants who applied for more than their predetermined amount will receive a pro-rata allocation of approximately 59.67 percent of the excess shares for which they applied, with any excess transferred to the General Public Pool.
All applicants from the General Public received 10,000 shares and approximately 16.57 percent of the excess shares.
Although the offer was handily oversubscribed, ICInsider.com gathers there were applications that came in after the close just after the issue opened and closed minutes after opening so there is added demand that should provide a bounce for the stock.