Blog Page — Page 1449

Honey Bun growth slows to a crawl

August 6, 2013 by IC Insider.com

The year 2013 is the year of the snake in the Chinese’ calendar and the crawling pace that the snake normally exhibits is pretty much what’s happening to Honey Bun, a Junior Market listed company. Increased sales and profit which in slowed down in the first quarter of this year, has slowed even further in the latest quarter to June. Revenues crawled along at just 5 percent over the 2012 quarter compared to 20 percent in the Easter-boosted March quarter. Even then, the March quarter growth was slower than the near 32 percent growth for the first 3 months of the financial year.

Revenues were $161 million in the June 2013 quarter up from $154 million in 2012 and profit was only $2.3 million down from $7.5 million in 2012. For the year to date, sales are $540 million, up 17.9 percent from $458 million in the prior year. Profit on the other hand is flat at $40.8 million versus $41 million in 2012.

Gross profit in the latest quarter actually fell by $2.5 million compared to 2012, but year-to-date gross profit is up 9 percent while administrative expenses are up even more by 16 percent to $125 million. The increase to June clouds what has been taking place earlier. There was one-third jump in administrative and other expenses to $41.6 million, up from $31.3 million a year ago.

The company generated $189.6 million in sales in the March quarter up from $160 million in 2012 and for the six months $381.5 million versus $305.8 in the prior year.

Management attributed the reduced margin to rising prices for flour and other inputs, which could not be passed on to consumers at the same pace as the cost hikes. For the March quarter, management stated that sales improvement was as a result of increased sales to new markets and exports, which increased by over 150 percent, year over year for the 3 months.

Healthy finances | The company continues in a healthy financial state with working capital at a ratio of 3 to 1 inclusive of cash and investments amounting to $75 million. This cash is up from $24 million at the end of September last year. Receivables grew at the end of the quarter to $61 million compared to $43 million in 2012.

Equity was $297 million and loan borrowing at a low of $24 million at the end of June. The stock last traded at $4 each but could well decline somewhat with these results. This year’s earnings at the end of June was 43 cents. The September quarter’s results are difficult to predict as it is the worse quarter of the year for the company. As such, the EPS at year end in September is likely to be lower than for the nine months based on past years’ numbers.

Related post | Honey Bun not so sweet in Q1

Filed Under: Company News, Company Results Tagged With: Honey Bun, JSE Company

Non-traditional exports narrow trade deficit

August 6, 2013 by IC Insider.com

Jamaica’s trade deficit narrowed for the first 4 months of this year by US$80 million as non-traditional exports jump by US$32 million to exceed traditional exports as traditional exports fell during the period and imports dropped. The overall traded deficit fell to US$1,522 million, down from US$1,602 million in 2012.

Domestic Exports | For the year to April, non-traditional exports increased by US$32 million or 12.4 percent to reach US$294 million. Its contribution to total domestic exports increased from 44.1 per cent in the January to April 2012 period to 50.7 per cent in the 2013 period, while traditional domestic exports fell to US$287 million by 13.6 percent or US$45 million when compared to the same period in 2012. The fall of traditional exports was impacted largely by the decline in “Mining and Quarrying” and “Manufacture”. Total export of goods is valued at US$605 million and is down from US$611 million in the 2012 period, a decrease of $6.6 million. The Jamaica Free Zone accounted for US$92 million of total exports during the 2013 period.

Imports | The country imported goods valued at US$2,127 million during the period, a decrease of US$87 million or 3.9 percent. The value of imports, for all but three commodity groups declined. “Mineral Fuels, etcetera” despite its decline, had the largest share of imports representing 34.5 percent valued at US$733 million, “Machinery and Transport Equipment” valued at US$280 million, declined from the US$294 million recorded in 2012 by US$13 million or 4.5 per cent. “Manufactured Goods” valued at US$175 million also decreased, moving downwards by US$27 million or 13.2 per cent.

Caricom| Imports from CARICOM for the first four months of 2013, fell by US$99 million or 28.4 per cent compared with 2012 and accounts for 11.7 percent of total imports with a value of US$249 million compared to US$347 million recorded for the 2012 period. “Mineral Fuels, etcetera” decreased during the 2013 review period, by US$111 million or 42.7 per cent and was valued at US149 million. Other notable commodity groups imported from the region included “Food”, valued at US$60 million, “Beverages and Tobacco” US$14 million, “Chemicals”, US$10 million, and “Manufactured Goods”, US$8 million.

Total exports to CARICOM for the January to April 2013 period was valued at US$21 million, representing a decline of US$2 million or 8.8 per cent. Domestic exports to CARICOM decreased to US$17.8 million and accounted for 3.1 percent. Re-export for the period decreased and was valued at US$3.2 million, a fall of US$0.6 million or 16.2 per cent.

For the first four months of 2013, Jamaica incurred a trade deficit with her CARICOM partners of US$227.8 million when compared to the US$324.4 million recorded for the first four months of 2012.

USA deficit big drop | During the month of April 2013, the United States of America (USA) remained Jamaica’s main trading partner with imports worth US$744 million and total exports of US$322.9 million. Jamaica’s trade deficit with USA was US$421.5 million, compared to US$565.5 million in the January to April 2012 period.

The trade gap narrowed by US$96.6 million or 29.8 per cent, due mainly to lower imports of “Mineral Fuels, etcetera”.

Filed Under: Economy Tagged With: Economy, GOJ

TTSE: Witco drops 95 cents

August 6, 2013 by IC Insider.com

Tuesday, 6th August 2013 | West Indian Tobacco Company traded 27,743 shares valued at $3,247,318 as the stock lost 95 cents to close at $117.05. The stock which is one of the highest on the Trinidad market at nearly 27 times this year’s estimated earnings may be considered pricey and most likely will see a decline in profits due to the sharp 30 percent drop in cigarette sales in Jamaica since it supplies the bulk of cigarettes to Carreras. The stock may be fully priced at these levels.

Overall, there was trading in 12 securities of which 4 advanced, 4 declined and 4 traded firm as the market recorded a volume of 361,037 shares valued at $18.68 million. ANSA Mcal saw 208,344 shares changing hands for a value of $13,808,135, followed by Sagicor Financial Corporation with a volume of 32,516 shares for $227,612 as the price increased by 10 cents to end the day at $7.00. Point Lisas Industrial Port Development Corporation contributed 32,003 shares with a value of $120,742, while Clico Investment Fund posted a volume of 3,600 shares valued at $77,472, the stock advanced by a cent to end at $21.52.

National Enterprises traded 20,300 units firm at $16 and Jamaica Money Market traded 22,662 units at 44 cents.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer indicator shows that the bid for 1 stock, Trinidad Cement, was higher and 1 stock had the offer lower than the last selling price.

Filed Under: Stock Market, TTSE Market Tagged With: Daily Trading, Trading Activity, TTSE

FX: Monday big for FX

August 5, 2013 by IC Insider.com

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Monday, 5th August 2013 | Monday was a big day in the forex market with the equivalent of US$55 million being purchased and US$48.7 million being sold. The actual amount of US currency traded was $48.98 million with $45.2 million sold. The buying rate inched up by 13 cents to $101.16 and the selling rate slipped by 4 cents to settle at $101.81. Authorised dealers bought the US dollar at 60 cents more at $102.80 but the lowest buying rate rose by $3.08 to $80.69. The high for selling declined by $2.67 to close at $104.54 but the lowest rate for selling remained unchanged at $83.67.

The Canadian dollar rates for buying and selling fell as buying rate cost 25 cents less than the price on Friday at $96.07 and selling was 34 cents less at $97.61. The highest buying rate fell 40 cents to $99 while the highest selling rate declined by $1.44 to $101.44 and the lowest buying rate increased by $1.53 to $79.18 and the lowest selling rate was down by $1.22 to $94.70.

The average rates for the Pound rose by $2.16 for buying the currency which closed at $153.73 and the sell rate rose by 89 cents to $156.06.

Filed Under: FX Market, Stock Market Tagged With: Daily Trading, FX Market, Trading Activity

JSE: Easy does it

August 5, 2013 by IC Insider.com

Monday, 5th August, 2013 | The JSE market closed today with stocks of 27 companies traded resulting in a volume of 2.8 million shares valued at just $17 million. There were 6 stocks advancing and 7 declining as all the indices with price changes lost value moderately, in what seems to be a holiday mode market. Price changes were low with only Carreras with a 50 cent gain to $51.11 being the most pronounced movement as 44,487 units of that stock traded, valued at $2.28 million.

Main market trades of note | The all Jamaica Index shed 68 points and the JSE market index dropped 38.72 points. Jamaica Money Market Brokers traded just over 100,000 shares to close at $8.20, a gain of 11 cents on the day. Sagicor Life traded over 72,000 shares and lost 15 cents as it closed at $8.85. Scotia Group traded 266,649 units closing at $21.12 with a value of $5.64 million. Seprod traded 87,200 units valued at $1.285 million as the stock closed at $14.75 the same as on Friday. Mayberry Investments chipped in with 287,609 units at $2.60, accounting for $748,000.

Caribbean Cement cemented the gains over the last few weeks as the company reported a profit in the June quarter and investors cheered the results by bidding the stock up to $1.12 at the end of trading but bought all that was available at $1 and 99 cents. The stock closed up 10 cents on a volume of 471,000 units.

Junior market | Trading took place in the shares of 9 companies as the index shed 5 points. Honey Bun which traded 10,100 at $4 reported results to the June quarter which was flat with the nine months for 2012 but the results for the quarter showed a 4 percent sales increase but that was inadequate to prevent a reduction in profits which declined from $7.5 million to $2.34 million in the quarter. The stock has no bid at the end of trading.

KLE Group dropped 20 cents to trade at an all-time low of $1.80 but only 4,000 shares changed hands. Lasco Distributors traded 279,350 units and closed down 2 cents to $1.48, Lasco Financial traded 184,737 shares to end up 5 cents more than the opening price to close at $1.55 while Lasco Manufacturing traded 110,160 units and dropped 8 cents to close at $1.52 after trading as high as $1.60.

Eppley shares that were listed last week still have not traded and have no bids or offers at the close of trading.

Proven Investment Preference shares traded 532,000 units valued at $5.09 valued at $2.7 million while there was a small volume traded in the ordinary shares.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 7 stocks were higher with 2 stocks having offers lower than their last selling price.

Filed Under: JSE Main Market, Stock Market Tagged With: Daily Trading, JSE Company, Trading Activity

Barita, Lasco Financial get thumbs up

August 5, 2013 by IC Insider.com

Monday, 5th August 2013 | Two weeks into the earnings season and quarterly reports continue to flow in. How will the markets respond? Our ‘Stocks to Watch’ list gives clues for some of the market action expected this week.

Buy Rated Stock | New to our Buy Rated list are Barita Investments and Lasco Financial, which brings the number to 5 companies that have received a ‘two thumbs-up’ based on our review of their 2nd quarter results.

Other companies that reported results and solidified their position on our Buy Rated list are Access Financial and Lasco Manufacturing.

Better than a broker’s ‘buy’ recommendation, IC Insider has no vested interest in any stock transaction or conflict of interest. Our research is backed by published reports of the company’s performance and insights of future earnings that can be found at ICInsider.com. The final decision to buy, or not, is your personal choice.

To find published reports for a Buy Rated stock on IC Insider, please use category ‘Buy Rated’ under Company News or enter the company name, in full or part at ‘Search IC Insider’.

Image courtesy of ImageryMajestic/FreeDigitalPhotos.net

Filed Under: Company News, FX Market, JSE Main Market, Stock Market, Stocks to watch, TTSE Market Tagged With: JSE Company, Trading Activity, TTSE

TTSE: Agostini’s at 52 weeks high

August 5, 2013 by IC Insider.com

Monday, 5th August, 2013 | Trading on the Trinidad & Tobago Stock Exchange on Monday was subdued with 11 securities trading of which 2 advanced, 3 declined and 6 traded firm as just 708,913 units changed hands valued at $2.33 million.

Interest continued to be displayed in Trinidad Cement (TCL) with a volume of 503,031 shares changing hands for a value of $759,577 as the stock closed at $1.51. The price remained steady at Friday’s last traded price but the bid was higher at the close at $1.52 suggesting further gains ahead. The TCL Group released results on Friday showing a continuation of the return to profitability that was evidenced in the first quarter. Profit due to shareholders of TCL was placed at $46 million and $73 million year to date. While there are some one off cost and income that ought to be adjusted for to arrive at ongoing income, it would still mean a decent profit in the quarter and year to date.

Prestige Holdings saw 100,000 shares being traded for $935,000, while National Flour Mills had 70,000 shares with a value of $49,000 but ended up falling 5 cents to close at 70 cents. Sagicor Financial Corporation added 11,500 shares valued at $79,350. Agostini’s traded 4,304 units at $17 increasing by 33 cents to end the day at $17.00, a new 52 weeks high. Clico Investment Fund posted a volume of 6,600 shares valued at $141,964 and advanced by a cent to end at $21.51.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 3 stocks were higher and 1 stock had the offer lower than their last selling price.

Filed Under: Stock Market, TTSE Market Tagged With: Daily Trading, Trading Activity, TTSE

Cement profit surge – not so fast

August 5, 2013 by IC Insider.com

Caribbean Cement Company is reporting a major change in fortunes in the latest quarter ending June from a loss of $497 million in the first quarter to a profit of $359 million in the June quarter. For the six months to June, the Group is reporting loss of $137 million, compared to a loss of $1,204 million in the corresponding period of 2012.

The loss of $137 million is after charging $701 million of non-cash foreign exchange losses compared to $136 million of foreign exchange losses for 2012. In the June quarter, Forex loss is $252 million but interest cost fell by $62 million and is down $60 million for the year to June. The bright light is not all that it appears to be at first sight as the results benefited from the write back of $591 million of withholding taxes on interest that was due to the parent company which have been reversed. The write back results from the restructuring of the parent company debt into preference shares.

Management states that, “We note that even before the write back of the withholding taxes, operating profit for the second quarter had improved over the prior quarter from $98 million to $153 million. This improvement is principally as a result of increased revenue from the 3% price adjustment in the domestic market in April and a doubling of export sales volumes in the second quarter, due primarily to our entry into the very vibrant Panama market.”

The numbers are saying that excluding extraordinary charges or income and assuming business is maintained at least at the current levels then a small profit should be eked out quarterly. The preference shares which are redeemable are effectively participating shares and are entitled to receive the same amount of dividend per share as the ordinary shares. There will only be a total of 115 million preference shares to 851 million ordinary shares.

Sales | Revenues for the quarter is up to $3 billion from $2.4 billion last year and $2.68 billion in the 2013 first quarter. Local sales in tonnes was the same as the first quarter but exports grew to 68,000 versus 33,000 in the first quarter. Local tonnage is up year to date by 20,000 tonnes but exports are below last year six months by 34,000 tonnes. Last year the local company exported cement to Trinidad as the plant there was under strike.

The restructuring of US$75 million of debt due to Trinidad Cement, contributed shareholder’s equity moving from negative $2.939 billion at the beginning of 2013 to positive $4,501 million at the end of June. The restructuring of the debt was completed with the conversion of US$37 million to preference shares, in accordance with the approval given by the shareholders at the Annual General Meeting, and with TCL making a capital contribution of US$38 million to defray the balance.

Caribbean Cement’s management stated that “they experienced operational gains through significant improvements in our plant efficiency, in particular specific energy consumption, following expenditure of approximately US$5 million in capital maintenance and upgrade works earlier in the year. As a result of the improved performance, we have been able to meet our debt obligations over the last six months. With the restructuring of the intra-group debt, the threat of foreign exchange translation losses has been significantly mitigated. We expect to maintain the improvement in export sales and grow these even further as we enter new markets in South America. While we do not foresee any meaningful growth in the domestic market, with careful cost management and the expected growth in export earnings, we expect to maintain these favourable results over the rest of this year”.

The June results is pointing to earnings per ordinary share of around 40 cents for a twelve month period. With these results, the stock which has risen from a low this year of 60 cents to a $1 recently, could enjoy further gains in the period ahead.

Related posts | Carib Cement profit mired in concrete

Filed Under: Company News, Company Results Tagged With: Caribbean Cement, JSE Company

Grace’s profit up 41% in June quarter

August 5, 2013 by IC Insider.com

Thanks to good pick up in other income and increased segment profit from the food division, GraceKennedy’s profit before tax was pushed up by 53 percent to $1.19 billion and 41 percent after tax of $703 million in the second quarter of the year to June.

In the first quarter, profit after tax was up by just 4 percent and 13.5 percent before tax but the results were negatively affected by the cost associated with the government debt swap. For the year to June, after-tax profit increased by 21 percent over 2012 to $1.39 billion with revenues being up 8 percent to $33.9 billion. The second quarter revenues were up 12 percent to $17.2 billion versus the 4 percent in the first quarter.

In the first quarter, the retail and money transfer divisions did well in growing profits. Banking and investment recorded a loss of more than $200 million while the huge food division only eked out a very small increase over 2012 figures. In the second quarter things looked better all-round except for Insurance which recorded a loss of $100 million compared to a break even position in the first quarter. In the second quarter, the food division contributed $170 million of the increased profit as sales climbed by $1.33 billion compared $470 million in the first quarter. Retailing with just $144 million more sales contributed $74 million more to profits. Banking and investments’ contribution in the second quarter was $229 million, while money transfer contributed $55 million to the increase in profits for the quarter.

In 2012, the first quarter was the highest for revenues than any other quarter, while the profit in the second quarter of 2012 was the lowest. The big jump in profit in the latest quarter is unlikely to repeat at that level for the remaining of the year but earnings seem set to reach between $9.50 and $10 per share for 2013.

Grace is a dominant player within the Jamaican market in its traditional business of food and trading and its focus on overseas markets for expansion and growth is obvious. Any meaningful growth in these two areas in the local market would have to come from growth in the economy, which is not likely to happen for a few years due to fiscal deficit reduction. Grace’s deeper involvement in investing in overseas markets with a physical presence could provide the needed market intelligence to grow by acquisitions and thus speed up the growth rate as well as providing a solid platform for the company to introduce some of its existing products to a wider populace.

Increased lending by banks, or the pace of it, gives a good indication about likely growth in profits. As such the 17 percent annual growth of lending by the group’s commercial bank, First Global, is a good indication that there should be pretty healthy growth in profits going forward, subject to strong control on non-performing loans. Banking, of course, is only one area of the group’s business.

Grace is financially solidly based with equity of $33 billion and total assets of $107 billion at the end of June.

The shares are trading at around 6 times this year’s earnings and sells for just under 60 percent of book value and approximately 30 percent of sales, making it historically cheap but relatively adequately priced. This should be a good medium to long term buy — don’t expect an explosive movement in the stock price unless the entire market were to do the same.

Related posts | Dividends: Carreras cuts, Grace ups | Grace looking up

Filed Under: Company News, Company Results Tagged With: Grace Kennedy, JSE Company

Access growth continues

August 5, 2013 by IC Insider.com

Access Financial Services is reporting another successful quarter but at a slower pace of 22 percent for the June quarter than for the first quarter. For the six months to June, earnings are up a still strong 34 percent to $119.59 million and $89.38 million in the same period last year. First quarter earnings increased 47 percent to $61.5 million from revenues of $173 up $19 million over 2012 first quarter. For the June quarter earnings came in at $58 million from revenues of $197.6 million versus $47.5 million in June 2012 based on revenues of $166.8 million.

Revenues for the year which was up by 13 percent in the first quarter is up 18 percent in the second quarter over 2012 and up 16 percent year to date. In the June quarter, revenues grew by $20 million over that of the March quarter but expense increased by $23 million led by a $11.5 million increase in provision for bad loans which resulted in slightly lower profit for the quarter versus the first quarter.

The results are coming off of a successful 2012 when it clocked up earnings of $238 million from an increase of 47 percent from revenues of $661 million.

The company’s growth is emanating from very strong growth in loans which increased from $643 million in March 2012 to $758 million at the end of March this year and to $776 million at the end of June. The last quarter is the period of greatest demand for loans and therefore the most profitable period.

Access is primarily involved in payroll lending at high interest rates amounting to about 60 percent per annum but they have been moving to more rapidly expand their offering to the small business sector. Investor’s Choice projects $1.37 per share earnings for 2013 and recommends the stock as a good buy.

The company has increased profits in each year and the stock has grown from $18.30 to the equivalent of $90 each (the stock was split into 10 units for each 1 owned and now trades at $9 each). Investors would have received a dividend in each year since the listing amounting to 65 cents based on last year’s earnings, 45 cents for 2011 earnings and 31 cents per share based on 2010 earnings — not bad for those who backed the issue.

Insider Call | Access Financial Services is a IC Insider Buy Rated stock.