Offer for Berger not serious

August 31, 2017 by

Minority shareholders in the Jamaican based Berger Paints have been made an offer to purchase the 104,990,171 ordinary shares that are not owned by the Trinidad based, Ansa McAl group.
The offer is priced at $10.88 per share, well below the price the stock has been trading at for most of 2017 and ever since the company posted strong increased nine months results in early February, re-enforced by earnings of $1.47 per shares for the full year to March, from a 15 percent increase in revenue. With an 11 percent increase in the first quarter to June this year to $23.4 million even as sales declined due to what the company says to inadequate cement supplies.
According to the offer document, from February 12 and March 11 this year, 659,600 units were traded between $10.99 and $13.56. A total of 834,100 units were traded from March 12 to April 11 at $11.41 to $14.49, thereafter until August 11, the trading range was $13.01 to a high of $23.90 with more than 2 million shares trading. In trading in the early morning session on Thursday 65,035 units were sold down to $13.

Berger Paints traded at a 52 weeks’ high of $23.50 earlier this year.

The offer document states that if the group gets 80 percent or more of issued shares, then they will apply to the Jamaica Stock Exchange to have the shares delisted. That of course is an unlikely development at the current offer price. More than 64 million shares or 30 percent of the issued shares are owned by savvy investors comprising 6 shareholders who are unlikely to accept such a low offer. Any success must have the consent of the majority of these holders.
Local stocks are trading at an average of more than 13 times 2017 earnings and that would place a value of Berger shares at $19 to $22 per share. Going forward, with economic activities picking up, profits should rise even more than at the current levels and would put the value of the stock at a higher level than the above range.

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

JSE surge to a new record on Wednesday

August 30, 2017 by

The main market of the Jamaica Stock Exchange claimed another record at the close of trading on Wednesday. The All Jamaica Composite Index advanced 1,319.06 points to a record close of 280,810.12 and the JSE Market Index gained 1,201.81 points to a record 255,849.82.
Trading in the US dollar market was moderate but the index rose 1.37 points to end at 178.89 as trading resulted in one security changing hands and accounted for 60,480 units valued at US$14,039.
The main market crossed over a resistance level at 273,000 points on the all Jamaica Composite index recently and have its eyes focused on 290,000, the next level to take out before the market enters open waters that seem to have no resistance level, going back to the late 1980s which suggest a major bull run ahead, supported by low interest rates, increasing profits and a growing economy.
At the close of trading on Wednesday, 23 securities changed hands in the main market and ended with 4,844,593 units valued at $284,429,479 changing hands compared to 3,871,868 units valued at $124,392,766 at the close on Tuesday. The total of all trades in both markets was to J$286,276,435 with NCB Financial Group trading over 3 million shares valued at $264 million. At the close market, leading to 7 stocks advancing and 10 declining in both markets.
IC bid-offer Indicator| At the end of trading in the main and US dollar markets, the Investor’s Choice bid-offer

NCB Financial Group traded 3m shares on Wednesday worth $264m.

indicator reading shows 2 stocks with bids higher than their last selling prices and 3 with lower offers.
The main market ended trading with an average of 210,634 units valued at $12,366,499 for each security traded compared to an average of 143,403 units valued at $4,607,139. The average volume and value for the month to date ended at $184,581 units with an average value of $4,435,127 compared with an average of 183,210 units with an average value of $4,017,686 on the previous trading day. The average volume and value for July ended at 160,668 units with an average value of $2,691,438.

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

Juniors inched higher on Monday

August 28, 2017 by

Trading on the Junior Market of the Jamaica Stock Exchange ended on Monday with 20 securities changing hands, 9 advanced, 9 declined and 2 traded firm as 1,303,888 units valued at $6,225,235 changed hands compared to 3,210,758 units valued at $13,020,965 on Friday.
Trading ended with an average of 65,194 units for an average of $311,262 in contrast to 145,944 units for an average of $591,862 on Friday. The average volume and value for the month to date amounts to 258,319 units valued at $1,591,093 compared to 269,679 units valued at $1,666,377 previously. In contrast, July closed with average of “NULL” units at “NULL” for each security traded.
Trading ended with the market sentiments looking mixed for Friday activity as 5 stocks ended with bids higher than their last selling prices and 2 with lower offers.
At the close of the market, stocks trading and their last traded price are: Access Financial finished trading 75 cents higher at $47 with 25,302 shares, AMG Packaging concluded trading with a loss of 3 cents to $3.45 with 25,441 stock units, Caribbean Cream ended 60 cents higher at $6.50 with 15,100 shares, Caribbean Producers finished trading with a loss of 15 cents, at $3.65 with 35,300 shares, Consolidated Bakeries settled with a loss of 29 cents, at $2.01 with 750 stock units, Dolphin Cove closed 10 cents higher at $17.50 with 1,475 stocks, Express Catering finished trading with a loss of 49 cents, at $4 with 38,177 stock units, Honey Bun settled with a loss of 70 cents, at $4.80 with 2,000 shares, Jamaican Teas settled 10 cents higher at $5 with 20,000 units, Jetcon Corporation closed 21 cents higher at $5.21 with 50,890 shares, KLE Group settled 25 cents higher at $3 with 50,323 units, Knutsford Express finished trading with a loss of 44 cents, at $14.06 with 2,200 units, Lasco Distributors closed at $7 with 40,685 stocks, Lasco Financial completed trading with a loss of 20 cents, at $3.80 with 11,350 shares, Lasco Manufacturing traded 1 cents higher at $4.60 with 25,677 units, Main Event settled at $4.50 with 100,745 units, Medical Disposables settled 50 cents higher at $5.50 with 5,200 stocks, Stationery and Office settled 10 cents higher at $4.10 with 796,273 shares, tTech closed with a loss of 95 cents, at $6.05 with 7,000 stocks and Derrimon Trading closed with a loss of 10 cents, at $2 with 50,000 shares.

Filed Under: Feature Stories, JSE Junior Market, Stock Market Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , ,

Watch impact of interest rate cut

August 28, 2017 by

Lower interest rates make real assets more valuable than before, as such the biggest change to stocks this coming week may well be guided by the recent cut in interest rates, with Treasury bill rates falling and the Bank of Jamaica cutting its overnight rate by 25 basis points.
At the close of last week, Caribbean Cream closed at $6.20 and helped to return it to the TOP 10 list, replacing Lasco Financial with its price rising to $4 from $3.40.
There were no other change to the two listings at the close of the week, even as the main market of the Jamaica Stock Exchange closed to week at record new high. For the coming week the cut in interest rates by Bank of Jamaica as well as a fall in the most recent Treasury rates could well positively impact prices.
The average PE ratio for the Junior Market Top stocks is at 7.5 and the PE for the main market TOP 10, ends the week at 7.3. The average PE for the overall main market trades at 13.6 and 13.3 for Junior Market, based on 2017 estimated earnings.
At the close of the week, IC Insider.com’s TOP 10 stocks now trade at an average discount of 44 percent to the average of the market for Junior Market Top stocks and it remains at 46 percent for the main market.

Filed Under: Buy Rated, Stock Market, Stocks to watch Tagged With: , , , , , , , , , ,

JMMB pretax profit up 16%

August 22, 2017 by

JMMB Group profits up 16% before tax to June.

JMMB Group posted a 16 percent increase in pretax profit, for the June 2017 quarter over 2016, but increased taxation left shareholders with a much smaller 4 percent increase to $617 million, as taxes climbed from $264 million to $381 million.
Net revenues jumped 19.4 percent to $4.1 billion from $3.44 billion in 2016, operating expenses rose even faster at 20.5 percent to $3.1 billion. Net interest income improved noticeably, moving from $1.55 to $1.9 billion as interest income grew to $1.96 billion, from $3.62 billion and cost fell modestly to $2.04 billion. Gains from securities trading rose to $1.54 billion from $1.1 billion but with revaluation of the Jamaican dollar, the group earned $238 million in the quarter, down from $443 million as the group also benefited from one off gains in 2016.
The Jamaican operations contributed 23 percent to growth in operating revenues, putting it at 75 percent of overall group revenues while Trinidad with its economic challenges, remained flat with just a one percent increase and Dominican Republic generated an increase of 18 percent.
Growth in managing pension funds, unit trust and money market funds, with assets under management moving from $89.5 billion in June 2016 to $114.75 billion helped in moving fee income up from $298 million to $364 million over the same period.
The group gained commercial banking license approval in Jamaica, in the September quarter, started to convert some branches to accommodate the new thrust and were also preparing for the roll out of their pension fund management in the Dominican Republic.
Total assets grew from $252 billion to $268 billion between March this year and June, shareholders’ equity moved from $25.9 billion to $26.8 billion including $2 billion in investment revaluation reserves at June this year, lending was almost static at $48 billion versus $47 at March. Investment in resale agreements stood at $173.8 billion versus March’s $172.5 billion. Customers’ deposits rose to $50.87 billion from $49 billion in March, while securities sold under repurchase agreements stood at $169.5 billion, up from $156.6 billion as of March, representing a fairly significant increase of $14 billion in just one quarter.
On Monday, JMMB Group closed at $21.50 on the Jamaica Stock Exchange and TT$1.20 (J$22.80) in Trinidad on Monday. IC Insider.com projects earnings of $3 for 2017 up from $2.03 as of March this year, putting the PE at 7 times the March 2018 earnings. The stock continues to be IC Insider.com BUY RATED.

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

JMMB could continue higher

August 20, 2017 by

JMMB Group traded at a 52 weeks’ closing high od $21.45.

Based on the trading activity for the past few days there seems to be increased interest in JMMB Group shares with a sharply declining supply being offered after the company released its first quarter results and announced that they have commenced commercial banking operations in Jamaica.
On Friday the price closed at $21.50 with 782,460 shares traded, after it traded at $23 in the morning session as supply totally dried up at one stage when only a small volume was on offer at $29, the first this has happened in a long time. At the close less than 240,000 units were offered for sales, with most quoted at $22.50. The group reported pretax profit rising to $995 million from $857 million in 2016 but profit after tax just inched up to $613 million from $590 in 2016.
Cable and Wireless came in for buying but sellers were just as interest in selling, in the end supply on the market has been shrinking. The stock could well see side-ways movement during the week, don’t be surprised if the price moves up as supplies around last week’s closing price recedes. NCB Financial Group has seen the price in Trinidad coming close to the Jamaican price on Friday, with demand still strong in that market and no stock on offer. The closing bid in TTSE suggests upward price movement can be expected. Supply in Jamaica is not great, it’s just that buyers are taking their time to acquire and could well be trying to hold out until close to the release of the full year’s results in early November. There was spirited buying of Barita Investments on Thursday gone, with 163,100 units being snapped up aggressively. There was no follow through of such aggression on Friday. It is anyone’s guess where this one will go, in the days ahead, but it is worth watching. Berger Paints pulled back to $14 during the week, with no announcement from its new parent company about the minority holdings. Ansa McAl announced that they would be making a submission about the 20 percent minority holdings in the Trinidad sister company, with no comments about the operations in Jamaica.

Consolidated Bakeries (Purity) stock could fall during coming week.

There is a fair bit of swing in the price of Stationery and Office Supplies with selling coming in during the week, but with buying more subdued than before. Investors can probably expect the price to swing between $4 and $5 for a while. The price could even falling into the $3 to $4 range depending on how fast sellers want to exit. At least that is what the bids and offers suggest, unless there are some increased buying in the week ahead.
Jamaican Teas after reporting nine months results with increased earnings per share over 2016, traded as high as $5.30 during the day but closed at $5 as increased interest was visible for the stock, suggesting that the price could rise further. Jetcon Corporation continues to attract buying interest after posting doubling of profits for the first six months of 2017 and traded as high as $5.70 before pulling back to $5.50 at the close on Friday, with bids to buy in line with the closing price. Paramount Trading came in for some buying with the price recovering from its fall to $2.50 recently after the company stated that they were I the process of constructing the Lubricant plant with operations to commence later this year. Currently supply below $4 is scanty.
Consolidated Bakeries reported a loss in its June quarter leading to a fall in the stock price. Selling continues with more than 660,000 units on offer at $2.15 and weak bids. Further decline is to be expected.

Filed Under: Stock Market, Stocks to watch Tagged With: , , , , , , , , , , , , ,

Profits surge at Kingston Wharves

August 20, 2017 by

Revenues at Kingston Wharves jumped 19 percent or $467 million over the corresponding period in 2016 to $2.9 billion for the six months to June 2017 and 22 percent for the June quarter to $1.55 billion.
The strong revenue growth resulted in profit before taxation climbing 32 percent from $650 million in 2016 to $857 million for the half year and an even more impressive 40 percent in the quarter, to $454 million. Net profit attributable to shareholders increased 34 percent, moving by $187 million to $742 million over the comparable period in 2016 for the six months and a strong 46 percent in the latest quarter, to $414 million. The results produced earnings per stock unit of 29 cents for the quarter and 52 cents for the half year.
The strong quarterly performance comes against the background of a sharp fall in other operating income from $105 million to just $17 million, partially offset by finance costs declining to $31 million from $67 million in 2016 June quarter.
The Terminal Operations Division delivered revenues of $2.3 billion, a 19 percent increase over the corresponding period in 2016. Divisional operating profits increased by 50 percent from $485 million to $727 million. The key drivers include growth in container handling, motor units and break bulk operations amongst other areas. “Total revenues earned in the Logistics and Ancillary division amounted to $676 million, with operating profits totaling $192 million, an increase of 15 percent and 6 percent respectively, over the corresponding period in 2016 due primarily to continuous expansion of KWL’s service offering and a widening of its customer base, as well as improved operational efficiencies gained through increased use of technology to manage the warehousing operations and security services,” the chairman Jeffrey Hall, the company’s chairman reported to shareholders.
Administrative expenses rose much faster than revenues at 30 percent for the quarter, to $290 million and 18 percent for the six months to $543 million.
The Group’s balance sheet reflects short term investments and cash of $3.1 billion, shareholders’ equity of $19 billion and borrowed funds amounting to $2.4 billion.
The growth for the half year has been very strong suggesting that IC Insider.com’s forecast of $1.13 for the full year is on track and may even be exceeded if the second quarter pace of growth continues. The stock traded at on the Jamaica Stock Exchange on Friday gone at $30, resulting in one of the highest valued stock on the market at a PE of 27 times current year’s earnings. If the growth continues at the current pace into 2018 then the current value would be acceptable as the valuation would fall under 20 times 2018 earnings.
Kingston Wharves will shortly launch new logistics facilities for the warehousing of general cargo, and the storage of bulk and automotive cargo for domestic and transshipment markets and have already had acceptance from potential customers. The location of this is slated for lands adjacent to the Tinson Pen airport in Kingston.

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

Kingston Wharves pumps up JP profits

August 20, 2017 by

Jamaica Producers current HQ.

Jamaica Producers made improvement in its operations, with strong gains in operating profit, helped by the consolidation of Kingston Wharves (KW), but importantly, gains from its other core business.
The company reported profit attributable to shareholders of $158 million for the second quarter and $251 million for the half year to June, 2017.
The results flowed from revenues of $7.4 billion up from $4.6 billion in 2016 for the half year and $4 billion for the quarter, up from $2.4 billion in 2016. In 2016 the group’s share of KW was treated as an associate as such the revenues for 2016 does not include that for wharf as is the case in 2017.
Closer look at the numbers, shows that while profit jumped sharply, the subsidiary Kingston Wharves accounted for $485 million of the $546 million profit generated from operations in the June quarter and $918 million of the $981 million generated for the half year. Revenues from KW amounts to $1.55 billion for the quarter and $2.94 billion for the six months, less than 40 percent of JP group’s revenues.
The numbers suggest there is much work to be done, to knock Producers as the group is called, into shape. Relocation of the head office from rented property to an existing property owned by them and serving other group companies and the consolidation of the Tortuga Rum Cake operations in Kingston with modern equipment and other changes, will help to improve profitability of the core business.
The results for 2017 translate to 14 cents per share for the quarter and 22 cents for the half year and should end around 50 cents for the year. With a stock price of $13.75 the market value is a very rich 29 times earnings against a market average of just over 13. The stock which traded as high as $22 earlier this year has been slowly correcting and seems headed lower as investors get a clearer picture of the likely full year’s earnings.
The group’s main activities are port terminal operations, logistics, the cultivation, marketing and distribution of fresh produce, food and juice manufacturing, land management and the holding of investments.

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

Junior market drops again

August 16, 2017 by

Jamaican Teas CEO, John Mahfood. The company traded 25m shares. on Wednesday.

Trading on the Junior Market of Jamaica Stock Exchange jumped on Wednesday with Jamaican Teas traded over 25 million shares as one large shareholder reorganized a portion of their holding. A total of 22 securities traded, 9 advanced 5 declined and 8 traded firm.
The Junior Market Index declined by 44.92 points to close at 3,112.54. Trading closed with 8 stocks ending with bids higher than their last selling prices and 4 with lower offers. The Market closed with 28,446,953 shares valued at $130,472,160 trading, compared with 2,187,410 shares valued at $12,791,307 on the previous day.
At the close of the market, the volume of stocks changing hands on Wednesday and the last prices they traded at are: Access Financial with 3,630 shares at $46.20, AMG Packaging closing with 4,624 shares at $3.50, CAC 2000 ended 35 cents higher to $7.40 with 46,692 shares, Cargo Handlers gained 30 cents to close at $11 with 1,000 shares, Caribbean Cream closed 80 cents higher at $6.70 with 1,877 shares, Consolidated Bakeries lost 24 cents, to close at $2.26 with 221,280 shares, after the company posted a loss in the June quarter on Lower revenues than in 2016. Derrimon Trading fell 90 cents, to $7 with 800 shares, Dolphin Cove closed at $17.50 with 5,534 shares, Express Catering with a loss of 1 cents, closed at $5.20 with 311,836 shares, General Accident with a loss of 7 cents, closed at $2.60 with 615,796 shares, Honey Bun closed at $5 with 4,500 shares, Jamaican Teas moved 25 cents higher to $4.95 with 25,101,325 shares, Jetcon Corporation climbed 20 cents higher to $5.50 with 43,070 shares, KLE Group closed 10 cents higher at $2.10 with 738,400 shares, Knutsford Express closed at $15 with 5,538 shares, Lasco Distributors rose 15 cents while closing at $6.70 with 576,888 shares, Lasco Financial lost 15 cents, and closed at $3.85 with 20,000 shares, Lasco Manufacturing closed at $4.33 with 71,292 shares, Main Event gained 5 cents to $5 with 3,732 shares, Paramount Trading closed at $2.85 with 64,224 shares, Stationery and Office Supplies traded 604,415 units with the price falling 59 cents to $4.40, and tTech rose 20 cents to $7 with 500 shares.

Filed Under: Feature Stories, JSE Junior Market, Stock Market Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , ,

Huge improvement at Jamaica Producers

August 16, 2017 by

Jamaica Producers at $14.50, currently.

Jamaica Producers made huge improvement in its operations, with strong gains in operating profit, helped by consolidation of Kingston Wharves but more importantly major gains from its other core business.
The company reported profit attributable to shareholders of $158 million for the second quarter to June and $251 million for the half year to June, 2017.
The results flowed from revenues of $7.4 billion up from $4.6 billion in 2016 for the half year and $4 billion for the quarter, up from $2.4 billion in 2016. In 2016 the group’s share of Kingston Wharves was treated as an associate as such the revenues for 2016 does not include that for wharf as is the case in 2017.
The results translate to 14 cents per share for the quarter and 22 cents for the half year and should end around 50 cents for the year. With a stock price of $14.50 the market value is a very rich 29 times earnings.

Filed Under: Company News, Company Results, Street News & Views Tagged With: , ,