MPC Caribbean Clean Energy (MPCL) stock traded at a record $275 on the Jamaica Stock Exchange on Monday as investors position to take advantage of a rights issue of 22,848,320 class B shares to be offered by the company.
The listed shares were priced at J$130 or US$1 when it came to the market in late 2018. The proposed new shares will be by way of a renounceable issue at J$140 to Jamaican shareholders and US$1 per share for shareholders in Trinidad and Tobago with a record date of November 8 as the Company seeks to raise the equivalent of US$22,848,320 from its shareholders.
The company went to the market in November 2018 to sell up to 50 million shares but the take up fell well short with the capital with just 11.25 million units with Jamaican taking up over 77 percent of the issue and Caribbean Clean Energy Feeder Ltd taking up 18.4 percent.
MPCL has 34.4 percent interest in the Paradise Park project that comprises a 50 MWP solar PV plant in Westmoreland in Jamaica that comprises a total investment of approximately US$64 million.
The second seed asset Tilawind is a 21 MW onshore wind farm based in Costa Rica in which MPC effectively holds 50 percent with the other half owned by ANSA McAL Group a Trinidad and Tobago group the total investment in that operation is approximately US$50 million. The wind park has been in operation since March 2015.
According to the company, a further 14 projects have been prioritized and form the indicative deal pipeline for the Investment Company. These require a total investment estimated at US$499 million to deliver up to 314 MW of new renewable energy capacity. The listed company invests in MPC Caribbean Clean Energy LLC who in turn invest directly the operating projects.
The company posted earnings for the nine months to September that reverses the positives number in the June Quarter. The results released are confusing, lacks transparency and will not help the company in raising the desired capital.
According to management, they have investments in two power-generating operations, with both in operation for the September quarter and generated share in profits of associated companies of $56,788. With just one-quarter of operation before from one location, they enjoyed a share in the profit of associate of $145 million in that quarter. The management report states that production at the Costa Rican operation generated 9.4 percent more energy than in the prior year. The numbers just do not seem to add up and management did not provide an explanation as to the reason why in their quarterly report. While the company is reporting total share of profit of $205,858 and a loss of $45,749 for the nine months period, the results from operations look vastly worse. The company reported a loss of $109,523 for the September quarter but advertising cost of $87,020 was the major cause of the big loss.
Regardless of what has been achieved to date, the performance is well off from the projections in the prospectus with a projected income of US$1.39 million and profit of $1.25 million for 2019 and projected revenues of US$2.94 million in 2020 with a profit of US$2.76 million.