Junior Market rallies Wednesday

Stocks mostly rose in trading on the Junior Market of the Jamaica Stock Exchange on Wednesday, with the volume of stocks traded declining 12 percent less and the value modestly more than on Tuesday with 39 securities trading, down from 41 on Tuesday, with 18 rising, 13 declining and eight closing unchanged.
A total of 6,446,267 shares were exchanged for $26,873,467 versus 7,315,888 units at $25,872,080 on Tuesday.
Trading averaged 165,289 shares at $689,063 compared to 178,436 units at $631,026 on Tuesday with the month to date, average of 172,027 units at $659,319. October ended with an average of 264,407 units at $832,036.
JFP Ltd led trading with 1.31 million shares for 20.4 percent of total volume followed by Dolla Financial with 747,702 units for 11.6 percent of the day’s trade and Dolphin Cove with 668,279 units for 10.4 percent market share.
At the close, the Junior Market Index increased 30.65 points to settle at 4,090.73.
The PE Ratio, a measure of computing appropriate stock values, averages 12.8. The PE ratios of Junior Market stocks incorporate ICInsider.com projected earnings for companies with financial year end that falls between November this year and August 2023. Investor’s Choice bid-offer indicator shows five stocks ended with bids higher than their last selling prices and three with lower offers.
At the close, AMG Packaging increased 30 cents to $3.48 while exchanging 9,516 shares, Blue Power fell 11 cents to $2.99 with investors transferring 15,284 stock units, Consolidated Bakeries rallied 44 cents to end at $2.99 as 50,197 units passed through the market. Dolphin Cove rose $1.52 to close at $15.50 as investors exchanged 668,279 stocks, following news that the company could be buying Mystic Mountains operations that enjoyed years of profitable operation. Everything Fresh climbed 16 cents in closing at $1.78 after trading 11,025 stocks, Fontana dropped 31 cents to $8.79, with 118,115 units changing hands. Fosrich gained 12 cents in closing at $4.57 after an exchange of 511,772 shares, Honey Bun declined 44 cents to close at $6.75 in trading 20,165 stock units, Indies Pharma popped 14 cents in ending at $2.94 after 62,708 units changed hands. Iron Rock Insurance advanced 44 cents to end at $2.74 with the swapping of five shares, Jamaican Teas shed 18 cents in ending at $2.58 with a transfer of 262,250 stock units, Knutsford Express rallied 65 cents to end at $9.45, with 302 stocks crossing the exchange. Lasco Distributors lost 14 cents in closing at a 52 weeks’ low of $2.66 after a transfer of 97,782 stocks, Lasco Financial dipped 14 cents to close at $2.70 with an exchange of 44,875 shares, Lumber Depot popped 19 cents to $2.70 in trading 304,239 stock units and Stationery and Office Supplies dropped $1.07 in closing at $15.06 after investors exchanged 23,000 units.
Prices of securities trading are those for the last transaction of each stock unless otherwise stated.

Mystic Mountain $500m Pref shares

In July, Mystic Mountain issued $500 million in 10.50 percent preference shares in a private placement. So how do they look financially? IC Insider got hold of some data to help investors understand what the operation is looking like. The funds raised are expected to cut borrowing cost, provide working capital and allow for expansion.

The company intends to apply to the Jamaica Stock Exchange for the listing of all of the Preference Shares by way of introduction and to make such application six months or as soon as conveniently possible after the closing of the Offer.

The company operates an attraction facility in Ocho Rios, Jamaica catering to all, but relying a great deal on foreign visitors to the island.

Information from the company states that “The Rainforest Sky Explorer is a chairlift ride which takes riders from the entrance to the heart of the action, 700 feet higher. The journey takes approximately 15 minutes each way and covers approximately 1.3 miles, giving riders superb views of the rainforest, the beautiful Caribbean Sea on the north coast of Jamaica and educational pictorial displays featuring Jamaican Olympian athletes that are set up at the top of the route.

Mystic MountainCHARTRFA is a British Virgin Islands registered corporation that, through its Hong Kong wholly owned subsidiary, is the majority owner of five ecotourism parks, two in Costa Rica, one with a management agreement in Mexico, one in St. Lucia, and Mystic Mountain in Jamaica. RFA owns 54.9 percent of Mystic Mountain. The remaining 45.1 percent is owned by Mike Drakulich, Norma Clarke and John Dalton. Additionally, the Company is planning to build a sixth park in St. Maarten and is in advanced negotiations to develop a seventh park in Rio de Janeiro.”

Profitability | Net profit for September 2012 amounted to US$1.186 million up from US$1,018 million in 2011 with profits being made in the last four years, the period that the company disclosed results for. Financial performance for 2nd quarter ended March this year and March 2012 showed operating revenues up to US$2.20 million, a US$179,000, or 7.5 percent decline compared to 2012. Direct operating expenses totalled US$940,000 in the quarter, a 10.4 percent or US$48,000 increase over the 2012 quarter. Administrative expense increased marginally by 3 percent from US$441,000 in the second quarter 2012 to US$455,000 this year. Finance costs fell from US$56,000 to US$40,000 in the second quarter this year compared to the similar period in 2012. Net Income declined by 34 percent or US$299,000 to US$580,000 in the quarter.

Revenues for the 2012 fiscal year amounted to US$7.146 million, an increase of 16 percent or $1 million over 2011 primarily as a result of an increase in visitors over the year. The compounded average growth rate (CAGR) for the 4 year period is 9 percent. Direct operating cost of US$2.40 million increased by 25 percent or US$500,000 compared to 2011, resulting in a gross profit of US$4.75 million for a 12 percent improvement over the previous year.

Operating expenses of US$3.36 million increased by 12 percent or US$358,000 relative to 2011, primarily as a result of increases in general operating expenses such as repair and maintenance and office expenses. Gross profit margin declined from 67 percent in 2011 to 66 percent in 2012. In 2009 gross profit margin was 74 percent.

Finance costs of US$205 thousand declined by US$27 thousand or by 12 percent relative to 2011 of US$232 thousand. Finance cost was reduced from a high of US$611 thousand in 2009.  Mystic has reduced its total borrowings from US$4.824 million to US$2.454 million in 2012 by paying down loans resulting in reduced interest cost.

Liquidity | As at September 30, 2012, the company had a current ratio of 1.05. This represents an increase of 22 percent of the liquidity position relative to 2011, in which the current ratio stood at 0.86. The level of equity to debt which was 110 percent in 2011 improved sharply to 160 percent in 2012.

The company’s working capital has been negative for the three years to 2012 and just went into the black in 2012.