Trinidadian companies are facing challenging times, the recent fall in the price of oil and gas on the world market has not made things any easier, in fact it is likely to make it worse.
Even before the collapse of energy prices profits of Trinidadian companies were pressured with little or just moderate growth. The challenges are not only in energy. Inflation in the twin island state has been running at high levels for some time with the latest figures showing 8 percent at the same time the country’s currency remained stable during the period of high price gains. While a lot of the increase was in the food category, it nevertheless would feed somewhat into general prices. While efficiencies could compensate for the higher prices, it seems unlikely with employment reaching very low levels placing pressure on labour cost as some businesses find it difficult to get persons to employ.
Against this back ground, it is not surprising that of 4 companies reporting for the December quarter, all show virtually profits.
First Citizens Bank could only turn a 2.8 percent growth in assets since December 2013 and 3.5 percent increase in loans into a 2 percent increase in profit after tax of TT$178 million from net revenues that were up to $430 from $428 million in 2013. Assets grew by 6.2 percent over September last year and loans are up 5.2 percent for the same period.
Expenses were flat at $210 million for the quarter. Earnings per share ended at 71 cents. For 2013 fiscal year, the bank earned $2.49. The stock price is now at $35.75 for a PE ratio of 14.
Massy Holdings reported a 20.6 percent jump in revenue but profit after tax rose only 6.5 percent to TT$144, that is well down on the 23 percent in the final fiscal quarter, to September last year.
Jamaica contributed less profits than in 2013 and so did Guyana but Barbados and Eastern Caribbean reported higher profits while T&T was flat and Columbia recorded profit. The business was acquired after the December quarter in 2013.
Segment profit before saw growth in Automotive and Industrial Equipment increasing by 30 percent, Integrated Retail gaining 8.8 percent, Insurance up by 14.8 percent, Energy and Industrial Gases fell 6 percent, Information, Technology and Communications declined 37.6 percent and Other Investments down 14 percent. The largest contributors to revenues and profits are Automotive and Industrial Equipment, Integrated Retail, Energy and Industrial Gases and other investments.
Earnings per share for the quarter amounts to $1.47 versus $1.39 in 2013, for the full year to September 2014, the company reported $5.69. Earnings should end around $6 for 2015. The stock price closed on Friday at $63.64, having peaked at $69.60 last year. The PE of the stock is around 11.
Republic Bank could not turn its 3.7 percent growth in assets into more than a 2 percent increase in after tax profit for the December quarter last year over the prior year even as loans grew by 9 percent over the same period. Net income grew by 4.5 percent to TT$899 million but operating expenses climbed a large 12 percent thus negating the increase in net revenues. The banking group saw a sharp reduction in the tax payable from$118 million to $97 million leaving $297 million for shareholders versus $291 million in 2013. The lower tax rate is partially due to a reduction in pretax profit from $423 million down to $408 million.
Earnings per share for the quarter ended at $1.84 versus $1.80 in the prior year and for the full year to September Republic reported $7.39 per share. The stock peaked at $122.05 last year, and has since retreated to close at $118.59 and looks set to decline some more. The stock carries a PE of 16.
Agostini’s reported profit of TT$27 million for the first quarter to December 2014 from revenues of TT$408 million compared with profit of $27 million from revenues of $378 million in the 2013 period. For the year to September 2014 revenues came in at $1.36 billion resulting on full year’s profit of $80.5 million. Earnings per share for the quart was 46 cents and $1.36 for the full year. The stock last traded at $17.60 at a PE of 13. Agostini’s is involved in pharmaceutical, personal care, food and construction product distribution.