Wigton shares list today

Wigton stock could double soon.

Shares in the highly sought after Wigton Windfarm will start trading today on the Jamaica Stock Exchange when the market opens at 9:30 this morning.
The shares that saw more than 31,000 investors the 11 million units that were on offer was heavily oversubscribed and persons within the financial market expects that it will trade at a premium to the 50 cents offer price. The shares will be restricted to a maximum price rise of 15 cents today or 30 percent of the IPO price, which is the maximum the stock exchange circuit breaker rule permits. If the bid closes at 84 cents at the close of trading then it can trade as high as $1.09 on Friday when the market reopens after the Labour day holiday.
The stock should be very liquid and that may constrain the price movements as speculators take profit early. The PE ratio of the stock is 8.5 times earnings but with many main market stocks priced in the 15 times region Wigton could get to that valuation and sell just under $1.
Mayberry Investments the main broker for the issue stated that the public sector pool was oversubscribed accordingly and all Public Sector workers who applied for less than 15 million shares were fully allocated while investors from the general public, were fully allocated up to 8.5 million shares.

Wigton Windfarm lists next Wednesday

Wigton IPO prospectus is out.

The wait by investors in the latest initial public offer of Wigton Windfarm to Jamaicans to list will soon be over with the shares set to list on the main market of the Jamaican Stock Exchange next week Wednesday.
The JSE in a response to IC Insider.com question today said that they are planning for the listing for next week. Other information has confirmed that the listing ceremony will start at 8:30 on Wednesday.
The government of Jamaica that previously owned all the company through Petroleum Corporation of Jamaica upheld the decision to sell all of the shares. Investors gobbled up all the 11 billion shares at 50 cents each and still wanted more as some 32,000 applications went after the issue making it one of the initial public offers to attract more than 30,000 applicants.
Information gleaned is that the allocation of shares will leave many of the bids with large amount of shares will not see much more than 4 million units being allocated to them.

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 Insider.com 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 Insider.com.  
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.


All Jamaica Index now 455,998

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The main market of the Jamaica Stock Exchange moved further ahead in early trading on Wednesday to record new records.
With more than half an hour before the afternoon session, the market hit 455,998.44 on the All Jamaican Composite Index (AJI) after rising by 2,858.98 points with NCB Financial trading as high as $151.50 and PanJamaican Investment at a record $100 after rising by $10 from Tuesday’s close of $90.
 The JSE Index climbed 2,598.04 points to be in record territory at 415,371.48.
The Junior Market index jumped 31.29 points to sit at 3,046.40 with Fontana trading at $4.49, General Accident at $4.45 and Lasco Manufacturing at $3.50.

NCB pushes AJIndex to record 450K

With less than 5 minutes after opening NCB Financial traded at $150 and helped to push the All Jamaican Composite Index (AJI) of the Jamaica Stock Exchange up by 2,821.75 points to a record 450,573.44.
The JSE Index climbed 2,564.21 points to a record 410,441.63to be well ahead of the record close on Monday.
The Junior Market index is up just 3.57 points to sit at 3,028.79. Also rising were PanJam Investment in trading at $89 and Supreme Ventures trading at $28.45.

Watch Cement and Sagicor

Image courtesy of suphakit73/FreeDigitalPhotos.net

The past week saw stocks prices moving up and down with the announced initial Public offering of Wigton Windfarm, a pattern is likely to continue for a while.
The release of 2019 first quarter results could change the pattern for some stocks, with a few due for release before the end of April. Last week there was increased buying interest in Caribbean Cement, NCB Financial Group and Sagicor Group on Friday with the release of full year results for 2018. Investors should keep an eye on these, Wisynco, RJR, Seprod that remain attractive buys.
The Junior Market is being shaken up following the release of the prospectus for Wigton, as such there are no clear security to watch in this market during the week.

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.

Huge interest in Jamaican stock market

With interest rates now at the lowest on receord in Jamaica and the local stock market now in its fifth year of a bull run, more and more persons are turning to the stock market for investment opportunities.
The increased interest is aptly demonstrated by the more than 1,300 persons who attended the Jamaica Stock Exchange receent staging of the 50th Anniversary Investor Forum. Marlene Street Forrest, Managing Director of the JSE said the record high turnout was historic and affirmation that Jamaicans are warming to the idea of investing in the stock market. “Being the number one performing stock exchange in the world says a lot and this has awakened Jamaicans at home and abroad to the possibilities that exist, when they invest in the market, which has returned over 300 percent over the last five years. This is significant and of course, persons are looking forward to benefit,” she said.
The record turnout comes against a well publized new public share issue by the Government of Jamaica, in the sale of 11 billion shares in Wigton Windfarm, at 50 cents each.
The event was sponsored by Barita Investments, with several of their top managers making presentations, including Vanessa Williams, Manager Mandeville branch and Ferris Jackson, Investment Advisor at Barita’s Kingston Office.

Wigton Windfarm’s profit upgraded

Wigton IPO propectus is out.

Net profit for the nine months to December 2018 for Wigton ended at J$730 million compared to $1 billion reported in 2017 before taxation.
IC Insider.com now projects normalized earnings for the 2019 fiscal year between $600-700 million resulting in earnings per share of 6 cents. As earnings for the above periods, include foreign exchange gains and losses. Included in other income is $552 million to December 2018 of foreign exchange gains and in Finance cost, $748 million, in foreign exchange losses. With the company repaying the foreign currency loans, the main source of foreign exchange gains or losses no longer exits, hence the need to normalize results without them.
Based on the updated earnings, with the price of the stock at 50 cents each, the PE ratio is now
8.5, valuing the company at just $5.5 billion. The stock now sits at number 4 on IC Insider.com TOP 10 main market stocks, making it more attractive than the value based on the projection to March this year, included in the public bodies’ document.
Wigton Windfarm IPO out very soon” an article published last week is running at the number one best read article on IC Insider.com and represents a clear sign of the popularity of the issue that opens on April 17.
IC Insider has now updated certain aspect of a second article, Wigton Windfarm IPO prospectus is out, carrying a more detailed look at the offer, and is proving to be quite popular but running well behind the first one currently.The lead broker for the IPO is Mayberry Investments.

Wigton Windfarm IPO prospectus is out

The long awaited prospectus for Wigton Windfarm is now available to the public, with an offer of 11 billion shares priced at 50 cents each. The offer will officially open on April 17 and scheduled to close at 4.30 pm on May 1.   
The company’s net energy output can only be sold to Jamaica Public Services Company, the country sole marketing entity, supplying energy to consumers. According to the government’s public bodies accounting records, the company projects profit of $587 million to the end of March this year, down from $826 million earned in 2018, helped by other income of $637 million versus just $52 million in 2018. The company generated sales revenue of $2.5 billion in 2019 and $2.36 in 2018. The annual growth in profit before finance cost is minimal grew just over 11 percent in 2015 and 2016 and a much slower 7 percent in 2017 and 2018, with a 6 percent decline in 2019.

Wigton IPO propectus is out.

In the nine months to December 2018 sales revenue was $1.95 billion compared to J$1.91 billion in the prior comparable period in 2017. Cost of Sales closed at J$544 million compared to J$535 million in the nine-month period for 2017. Gross Profit ended at J$1.4 billion compared to J$1.38 billion in 2017. Net profit for the nine months to December 2018 ended at J$730 million compared to J$1 billion reported in 2017.
Earnings for these periods, include foreign exchange gains and losses. With the company repaying the foreign currency loans, the main source of foreign exchange gains or losses no longer exits, hence the need to normalize results without them. IC Insider.com projects normalized earnings for the 2019 fiscal year between $600-700 million, resulting in earnings per share of 6 cents.
The company is heavily indebted with $6.3 billion of borrowed funds carrying interest rates of 6.65 percent to 8.4 percent with an average rate of just under 8 percent. Cash funds on hand amounts to $1.4 billion and equity of $2.4 billion. Current assets exclusive cash and payables are minimal. The company had borrowed most of it loans in US dollars, resulted in annual swings in net profit as the

Mayberry Investments is the lead broker.

exchange rate of the Jamaican dollar moved up and down. Loans in US dollars were paid off and the company raised Jamaican dollar funds, in preparation for the initial public offer.
The company’s generating capacity is 63 mega-watts. Wigton I Power Interchange Agreement expires in April 2024 and accounts for up to 20MW, Wigton II Power Purchase Agreement expires, December 2030 to supply up to 18MW and Wigton III Power Purchase Agreement ends in March 2036 for up to 24MW.
The price of the stock results in a PE ratio of just under 8.5, the company would be valued at just under $5.5 billion and sits at number 4 on IC Insider.com top 10 stocks. The big question that should be on investors minds, when will meaningful growth in revenues and profits come to justify holding the shares beyound what may well be an initial bounce.
The company directors are; Oliver Holmes, B.Sc., M.Sc. (Acct.) Non-Executive Chairman, Nigel B. Davy, B.T., J.P. Non-Executive Director, M. Georgia Gibson-Henlin, Q.C., B.A. LL.B. LL.M., F.C.I. Arb. Non-executive Director Hugh Johnson, Non-executive Director Gregory Shirley, B.A., M.B.A. Non-executive Director, Jacqueline Stewart-Lechler, J.P. Non-executive Director.