JSE: NDX impact overcome as market climbs

June 13, 2013 by

Thursday, 13th June 2013 | Mayberry bought 2,475 million shares of Jamaica Money Market Brokers (JMMB) for clients and Scotia Investment bought 1 million units for in house purposes today as 3.7 million units of JMMB changed hands valuing $31.8 million. The selling broker was JMMB mostly on behalf of clients. Carreras recorded a big trade worth $11.58 million as the stock traded 199,246 units and closed down at $59. NCB jumped to $22 at the close, up $2.50 with 242,000 shares trading at a value of $5.18 million. Grace Kennedy fell $0.75 to close at $58.25.

Index Climbs | The all Jamaica Index closed up 1,277.32 points and ended at 91,209.76 points, this means that the market is at its highest since the first week of January this year and has recovered all of the negative impact that the NDX did to the market index in February. The main market index closed up 725.54 points and closed at 88,639.94.

Bull2_150X150The Investor’s Choice bid-offer market sentiment indicator, points to more market gains ahead and this is backed up by technical indicators which suggest that the main market seems to be on track heading to 103,000 on the all Jamaica Index. The market seems to have broken out decisively from the 85,000 level. The 103,000 mark is the next major point of resistance followed thereafter by 115,000.

Juniors Down| Buy before results and sell after has been a pattern of the junior market from inception and it seems to be following that role again as prices of some stocks seem to have stalled or fallen back a bit as some profit taking takes place. The Junior Market index fell nearly 17 points to close at 732.81.

In today’s trading NCB, which climbed $2.50, would have had a telling impact on the index movement. However, this impact was tempered by a fall in Scotia Investments, off $1.

Advances positive | The advance decline ratio remains positive with 14 stocks advancing and 7 declining, on a day when 8 million shares changed hands with a value of $55 million. At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 11 stocks were higher with 4 stocks having offers that were lower than their last selling price.

JSEIndicesJun13

Filed Under: JSE Main Market, Stock Market Tagged With: , , ,

Palace’s $22m 3rd Qtr hit

June 13, 2013 by

While many local companies suffered from the negative effects of reduced profit due to costs associated with the write off of unrealised capital gains on government bonds, Palace had a totally different experience. Net results for the March quarter fell sharply to a loss of $22 million from a profit of $2.65 million in 2012. Nevertheless, thanks to a strong first half, the company reported a $8.2 million loss compared to a profit of $5.3 million earned for the nine months of the previous year.

Operating cost fell by $16 million or 10 percent for the quarter while administrative cost was up 11 percent to $34 million but it was the slide in income that was noticeable and probably worrying. Admittedly, the March quarter is usually the worse quarter the company faces. But it is the sharpness of the drop that is surprising. In the 2012 quarter, Palace generated income of $193.5 million, this fell 21 percent or a whopping $41 million to $152.3 million.

Interestingly, the 2013 revenue performance is only 8 percent better than the 2011 quarterly income even as inflation would have affected cost and the price for goods and services sold by Palace would have gone up since 2011. The fall off in 2013 comes against the background of the company introducing a new product, the showing of live operas on screen and an encore season of opera’s best in the summer. Without them, revenues would have been lower. Year to March, the company recorded revenues of $584.7 million that is lower than the $599.5 million generated up to March 2012.

PalaceAmusement3Data on the individual cinemas indicates that the sharp fall in revenues was across all locations except Palace Cineplex. Carib revenues fell $13 million, Cineplex was up $1 million, Palace Multiplex in Montego Bay dropped $13 million and Odeon in Mandeville fell by $4 million. The falloff in the two rural cinemas was far worse than for Carib, in relation to the income for the 2012 March quarter.

The picture up to the December results suggested that 2012/13 would have been by far the company’s best year, but the poor third quarter results have changed the outlook for full year’s profits completely, as it will be nigh impossible to overcome the negative impact of the loss made in the latest quarter.  ICInsider understands that the fall in revenues is due primarily to a shift in a particular brand of film which would normally be shown in the March quarter but will be shown in the June quarter.

In spite of the quarterly loss, Palace had cash funds of $60 million at the end of March, while current assets exceed current liabilities by $36 million. Loans amount to $42 million with equity of $271 million.

Photo via: www.PalaceAmusement.com

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

TTSE: WITCO another all time high

June 13, 2013 by

Thursday, 13th June 2013 | The West Indian Tobacco Company enjoyed the day’s largest gain, increasing $0.49 to end the day at $112.50, yet another all time high as the stock trades at a high PE ratio of 26 times earnings. The stock is still attractive from an income point of view with a yield of 3.4 percent compared with Treasury Bill rates in Trinidad of less than a percent. All indications are that this stock is still going higher. Scotiabank fell 29 cents to end the day at $69.71 as only 820 shares traded.

Main Market | The main market at the Trinidad & Tobago Stock exchange had a volume of 281,761 shares crossing the floor with a value of $1,652,262. Trinidad Cement saw 154,500 shares changing hands for a value of $147,975. Angostura Holdings traded a volume of 78,009 shares for $702,081. Sagicor Financial Corporation contributed 26,245 shares valued at $165,868. An infrequent trader, the Barbados headquartered First Caribbean International Bank accounted for 9,247 shares valued at $73,051.

Clico Investment Fund posted a volume of 105,940 shares valued at $2,289,349.44 with the price advancing by $0.20 to end at $21.61

Advances positive | The advance decline ratio remains positive with 5 stocks advancing and 1 declining, on a day 14 stocks traded. At the end of trading, the Investor’s Choice bid-offer sentiment indicator shows that bids for 4 stocks were higher with 2 stocks that had offers that were lower than their last selling price which is just mildly bullish.

TTSEJun13

Filed Under: Stock Market, TTSE Market Tagged With: , , ,

JSE: Juniors pick up

June 13, 2013 by

Wednesday, 12th June 2013 | While there were only 5 stocks traded on the junior market yesterday, today’s activity resulted in 11 stocks traded. With the exception of Blue Power that traded at an all time high of $8.65, up 64 cents for the day, as 52,315 units traded, price movement in the junior market was generally moderate. The overall stock market seems to have lost some of the recent sparkle as investors seem to have priced in a fair bit of the improved results of companies or adjusted for the undervaluation of others. The market may just be consolidating for awhile before moving in a major way again. This is worth watching.

Dolphin Cove traded 800,000 units to be the largest trade in the junior market and second largest trade for the day for the overall stock exchange. The stock closed at $8.45, a 52 weeks high. Sagicor Life traded 2,011,745 units as the stock closed at $9.01, having traded between $8.80 and $9.01.

Grace Kennedy traded up $1 to at $59 while trading 23,167 units. Lasco Distributors closed at $13.50 up 50 cents with a volume of 19,297 units trading. Lasco Financial Services lost 29 cents to close at $9.70 on small volume. Carib Cement traded as high as $1 in early trading but closed at $0.90. Consolidated Bakeries traded 58,750 shares at $1.15, in continuation of recovery from the sharp sell off when the company released poor full year results earlier this year. Lasco Manufacturing traded firm at $14.10 with 101,610 units changing hands.

The various market indices inched up a bit except the cross listed and US dollar indices where there was no traded stock. The advance decline ratio remains positive with 11 stocks advancing and 6 declining, on a day when 4.1 million shares changed hands with a value of $34.7 million.

At the end of trading, bids for 8 stocks were higher and no stock had an offer that was lower than their last selling price.

JSEIndicesJun12

Filed Under: JSE Main Market, Stock Market Tagged With: , ,

RJR’s $106M 4th quarter loss

June 12, 2013 by

Things are not good for the media houses these days as economic pressure and the withdrawal of Claro mobile operations from the Jamaican market coupled with a soft economy has cut revenues for this sector. In a tough economy, RJR group suffered a pretax loss of $106 million in the quarter ending in March after writing off $35 million for impairment of the investment in Reggae TV and JNN. This result is a major swing from the similar quarter of 2012 when a profit of $15.6 million was made. Result after tax for the period came out at a loss of $51 million versus a profit of $5.6 million in 2012.

A 5 percent fall in revenue to $446 million from $470 million in the 2012 quarter was one of the major contributors to that big loss in the quarter.

Annual Loss | For the year to March, the loss before taxation came out at $79.5 million and $36.4 after tax, compared to a pretax profit of $146.5 million in 2012 and a net of $87.4 million after taxation of $59 million. The company reported revenues of $1.866 billion for the year, in 2012 revenues were $1.937 billion a decline of 3.7 percent.

RJR_Newslogo150x150Bad debt provision increased from $10.7 million to $30.5 million and special events cost amounted to $186.8 million compared to $90.3 million in the prior year.

While amounts in receivables were kept relatively constant with the previous year’s figures, payables at the end of March climbed to $124 million versus $44 million and the company borrowed $201.5 million. Fixed and intangible assets were purchased amounting to $192 million of which FIFA world cup rights accounts for a large portion.

Decline | The company has suffered a series of set backs over the years. One that is most noticeable is the fall in return on equity from 21 percent in 2000 and 19.7 percent in 2010 to 10.3 percent in 2011, 6.4 percent in 2012 and now a negative return in 2013. Even adjusting for the one-off cost items that are in the 2013 fiscal year, profit would still be inadequate to beat the return on equity of 2012.

RJR recovered from a stunning loss of $129 million in 2009 to record a profit of $222 million in 2010, so it could recover again. However, there are some differences. In 2010, revenues rose by nearly 21 percent on top of a 7 percent in the two previous years. This time around revenues are down in a soft market for advertising as revenues were flat in 2011, declined in 2012 and again in 2013. This is not a market where revenues can be easily raised to dramatically turn around profits. On the positive side, there are some costs in 2013 that should not recur in 2014. Depreciation charge is $109 million, which is not a cash item, so even if it were to continue to make a small loss it can continue to operate for a long time until it recovers as cash flow can be positive.

FIFA rights | The company paid $83.55 million for the exclusive right to transmit FIFA football matches in Jamaica between 2015 to 2022 which means that it will be some time before this investment pays off.

The company’s stock trades at $1.37 and it is difficult to see how this stock will be able to justify a higher price with these results, but more importantly, how will the company grow revenues or cut cost to restore reasonable profitability.

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

JSE: Attention switched to main market

June 12, 2013 by

Tuesday, 11th June 2013 | Only 5 stocks traded in the junior market today with AMG Packaging closing up 22 cents at $4.40 while trading 24,937 units. Lasco Distributors closed at $13 off 74 cents for the day as it traded 14.900 units. General Accident traded 149,954 units at $1.92 and Lasco Manufacturing was flat for the day in trading 28,750 units at $14.

In the main market, Grace Kennedy traded 1.17 million units between $58 and $58.75 before closing at $58, down $1. Jamaica Money Market Brokers traded 706,000 units between $8.65 and $8.75 but closed at $8.65. Sagicor Life saw 319,000 shares swapping hands at $9 down 43 cents for Monday. Proven preference shares traded 1.336 million units at $5.09, National Commercial Bank closed up 30 cents at $19.50 at the close as 70,310 shares traded. Pan Jam rose 40 cents to close at $55.50. Seprod gained 39 cents to reach $15 at the close. Carreras traded 95,696 units while closing at $59 after loosing $1, the stock closed with its offer at $58.95. D&G had trading in 93,941 units at the closing price of $4.95 and at the end of trading there were 365,955 units with a bid at the closing price of $4.95.

In the end 4,502,486 shares traded for a value of $94.58 million as 23 stocks changed hands as 9 stocks registered price gains and 8 recorded declines. At the end of the day, bids for 2 stocks were higher and 5 stocks had offers that were lower than their last selling price

All the indices except the US dollar index where there was no trades and the junior market that slipped less than a point recorded moderate increases on the day.

JSEIndicesJun11

Filed Under: JSE Main Market, Stock Market Tagged With: , ,

Cable & Wireless email moves to Google

June 11, 2013 by

Cable & Wireless (C&WJ) has announced that they are going to use Google to host cwjamaica.com email and portal services in the future. According to a message to their subscribers the company says “this is a very exciting change, as it will enable us to provide you with latest email technology through Google’s dynamic suite of communication applications.”

The company said that they expect the Google migration to be implemented within the next two months and that email addresses will not change and that the change will not impact virtual domain customers nor will it impact any aspect of their Internet connection.

“In preparation for this move, a change to your email password may be required. Once the mail services have been transitioned to Google, your email password will need to be at least eight characters. This change is necessary to be compatible with Google’s security requirements, if your password is already least eight characters, you will not need to make any change. If not, you will need to change the password before July 8th, 2013 to avoid any possible downtime during the move to Google.” the release from the company said.

The move is likely to make it easier for the company’s customers to send and receive emails, especially when overseas. Presently, when overseas, email access is through the company’s webmail service which is not user friendly.

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

$2B slide in landline revenues sinks C&WJ

June 11, 2013 by

Cable & Wireless (C&WJ) revenues from landlines slipped $2 billion in the year ending March 2013 which helped push the company’s operating income into a loss before an exceptional charge of $2.75 billion relating mostly to reduction in staffing. A $670 million increase in mobile revenues could not prevent a slide of $1 billion in overall revenues which came in at $19.1 billion versus $20.4 billion in the previous year. In spite of the fall in revenue, a $1.5 billion drop in out payments made to other carriers offset by $500 million increase in other cost of sales resulted in gross profit slipping by just $340 million.

New rates | Last year June, when it announced radically new low rates, “the company indicated that it hoped the “game-changing” Talk EZ plan will double its market share from 18 per cent to 36 per cent within three years. It currently has 400,000 pre-paid customers and 50,000 subscribers, according to a Jamaica Observer report. The initial up take of the service last year suggested that they were on target to achieving that target with 250,000 new subscribers by the end of December but by March this year the numbers melted down to a 16 percent net increase or just under 100,000.

More customers | For the September quarter, the company stated that the mobile customer base increased by 20% and that they attracted 100,000 customers within 100 days of launching the new plan. Extrapolating, they started off with 500,000 mobile customers which reached 600,000 by September. In March the company shifted the tax of 50 cents per minute on cell calls to customers which they had absorbed from July last year when it was 40 cents per minute. This shift seems to have resulted in the attrition in new customers. Our estimate is that C&W decision to absorb the cell tax, cost the company about $500 million, a cost that won’t be repeated this year.

cellphone280x150Banking | The company is banking on the recent reduction in termination rate to hand it an advantage, as they retain more of the amount customers spend with them, as they talk more with the new rate for both local and overseas calls to other networks. Down the road they expect that number portability will also present them with another opportunity as mobile users will be freer to switch networks.

Going forward | “Now that we have the new, lower Mobile Termination Rate that will be almost 90 percent less than what it was a year ago, LIME is in a better position to increase subscriber numbers and grow revenues,” management said in an exclusive response to IC Insider.

What seems logical is that persons will be less concerned about what number they are calling once the various rates are close to each other. So the scenario where customers were ring fenced to calling within their network due to the high cost of calling other network will no longer exists, allowing for freer calling and quite likely more time spent talking.

It will also reduce staffing and related costs and have a net benefit as a result of outsourcing the repairs and servicing to Ericsson. The first quarter of the last fiscal year had a lower margin on calls made to other networks as the termination rate came into effect in July 2012. In this year’s first quarter, C&WJ will enjoy a higher margin on cross network calls, helping improve the bottom line.

The savings to come from outsourcing of the field service support and from the absorption of the mobile call tax plus some growth in net cell revenues suggest that the company should be much closer to a profitable position, if not a profit, in the current year from normal operational expenses, assuming they maintain substantially existing business and continue to add mobile customers and get more talk time from existing ones.

Stock outlook | The stock last traded at 16 cents with a bid of 17 cents. The company has a negative net book value and it owes the parent company $28 billion which attracts interest at Treasury bill rates plus 1 percent. Working capital is negative with current assets being less than current liabilities.

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

JSE: Light trading, advancers dominate

June 11, 2013 by

Monday, 10th June 2013 | Probably the most noted features of Monday’s trading was the continued strong positive advance decline ratio which started in the first week in April. At the end of the day, the indication from the bids and offers suggest further gains ahead with bids for 11 stocks being higher and only 1 stock had the offer that was lower than the last selling price.

A total of 3,390,391 shares valued at $22,151,233 traded, on a day when 24 stocks traded with 11 gaining and 4 declined in price continuing a strong advance decline ratio that has been present throughout May and now into June.

Trading was on the light side as only Jamaica Money Market Brokers exceeded the million share mark with 1.5 million units valued at $13 million. Caribbean Creams traded 613,481 units and Caribbean Producers 420,613 units were the other volumes of note.

Price movements were moderate with National Commercial Bank gaining 20 cents to close at $19.20, Sagicor Life closed at $9.43 up 3 cents and Scotia Group up 50 cents to close at $22, having traded as high as $23 during trading.

Access Financial Services reached a new all time high of $8.10 as well as Blue Power which closed at $8.10.

Stocks to watch

  • Access
  • Blue Power
  • Consolidated Bakeries
  • JMMB
  • Sagicor Investments

JSEIndicesJun10

Filed Under: JSE Main Market, Stock Market Tagged With: , ,

JSE: Profit taking took prices down

June 11, 2013 by

Friday, 7th June 2013 | The market indices that had trading activity recorded declines even as the advance decline ratio was one to one, with 8 stocks advancing and 8 declining. But by the end of trading, bids for 8 stocks were higher and 2 stocks had offers that were lower than their last selling price. Trading was much lighter than for most of the week with 3,738,986 units valued at $21.2 million as only 25 companies had stocks trading.

The all Jamaica composite index closed down 498.47 points at 89,195.42 and the main market index closed at 87,495.76 falling 283.14 and the junior market index closed at 747.27 down 2.68 points.

Price movements | Grace lost $1 in closing at $59, less than the bid price in Trinidad, NCB lost $3 to close at $19, similar to the price in Trinidad. JMMB lost 34 cents to close at $8.65 close to the Trinidad closing price, Sagicor Life lost 40 cents and closed at $8.60.

One noticeable trade was Caribbean Creams that traded 948,000 units, the largest volume for the day, between $1.03 and $1.10 all but 21,000 were purchased by Mayberry Investments for their own account.

JSEIndicesJun7

Filed Under: JSE Main Market, Stock Market Tagged With: , ,