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JSE: Prices recover but moderate trading

June 19, 2013 by IC Insider.com

Wednesday, 19th June 2013 | The local market recovered some of the losses it suffered yesterday which flowed mainly from crosses that Mayberry did for a number of stocks. In today’s trading, National Commercial Bank traded 2.976 million units at a value of $61.1 million of which Mayberry crossed $2.8 million for in house purposes at a value for $57.5 million.

Advances positive | Trading elsewhere was moderate with just a total 4.19 million shares trading at a value of $71.6 million. The advance decline ratio moved back into the positive once more with 12 stocks advancing in price versus 7 that declined.

The all Jamaica index climbed by 343.29 points to close at 90,039.73, the market main index closed at 88,000.81 up 194.99 points and the junior market was down 6.89 points in closing at 746.83.

Main Market | Jamaica Producers gained $2.65 to close at $20.70 as just 2,000 of its shares traded. Grace traded 3,000 shares as the stock closed at $59 and was up $1.50. Barita Investments lost 50 cents to close at a 52 weeks low of $2.50 as just 4,000 shares traded.

Juniors down | Six stocks traded in the junior market with 3 increasing in price and 2 falling. Blue Power moved up 14 cents to close at $9 but the bulk of the stock changed hands at $10.15 and the bid was at $9.10 at the end of trading, which suggests more price gains ahead. This activity comes on the heels of the announcement of results, which showed a 121 percent jump in profits for the year ended April. Lasco Distributors closed down 75 cents at $13 as 58,306 of the company’s shares traded. Lasco Manufacturing gained 25 cents to close at $14 as 15,144 of its shares traded. Caribbean Producers lost 20 cents while trading 47,175 units to close at $2 but the offer price was at $1.75 at the close with 134,822 units on offer.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 6 stocks were higher, with 3 stocks that had offers lower than their last selling price. The Indicator points to more market gains ahead but gains could be moderate as the market awaits new information for it to continue the rally that started in April.

Barbados raising BDS$150M

June 19, 2013 by IC Insider.com

The Government of Barbados has announced the issue of two bonds, one a debenture and the other Treasury notes to raise BDS$150 million in total, starting on the 24^th June.

The debenture which will open on Monday, June 24, 2013 and will be issued at par with a fixed interest rate of 6 7/8% per annum payable on June 30 and December 31 of each year and is targeted to raise BDS$100 million.

The Treasury Notes targets BDS$50 million and will be issued at par with a fixed interest rate of 4 1/8% payable on June 30 and December 31 of each year. The Treasury Notes will be repayable at par on June 30, 2015.

The interest due on both instruments to Pensioners 60 years and over residing in Barbados will not be subject to withholding tax. Non-residents seeking tax exemption must satisfy the Commissioner of Inland Revenue of their status before exemption is granted. However, for all persons resident in the island, the interest from these Debentures will be taxed separately from other income at a rate not exceeding 12½%. These Debentures will be repayable at par on June 30, 2024. The issue will remain opened until the Central Bank advises that it has been fully subscribed.

Filed Under: Economy Tagged With: Barbados, Economy, TBills

Inflation up in May

June 19, 2013 by IC Insider.com

Inflation for May as measured by the All Jamaica ‘All Divisions’ Consumer Price Index increased by 0.5 percent, a 0.1 percentage point increase over the 0.4 percent increase recorded for April 2013, this according to a release from the Statistical Institute of Jamaica (Statin).

The CPI movement was influenced by a 0.8 percent increase in prices for ‘Food and Non-Alcoholic Beverages’, the heaviest weighted division in the computation of the Index. The main contributor to the division’s inflation was an increase of 1.3 percent in the index for ‘Vegetables and Starchy Foods’. ‘Transport’, the second heaviest weighted division, recorded a decline, moving down by 0.2 percent. This was primarily because of lower prices for ‘Fuels and Lubricants for Personal Transport Equipment’, particularly petrol, Statin said. The third heaviest weighted division of the CPI, ‘Housing, Water, Electricity, Gas and Other Fuels’, recorded an increase of 0.7 percent. The upward movement in the index for May 2013 resulted in a calendar year-to-date movement of 3.7 percent.

The other divisions that recorded increases were ‘Alcoholic Beverages and Tobacco’ 0.7 percent, ‘Clothing and Footwear’ 0.3 percent, ‘Furnishings Household Equipment and Routine Household Maintenance’ 0.6 percent, ‘Health’ 0.3 percent, ‘Recreation and Culture’ 0.7 percent, ‘Restaurants and Accommodation Services’ 0.3 percent, and ‘Miscellaneous Goods and Services’ 0.4 percent. No movement was recorded for ‘Education and ‘Communication’.

All three regions covered by the survey recorded increases for the period; Greater Kingston Metropolitan Area (GKMA) 0.6 percent, Other Urban Centres (OUC) 0.8 percent and Rural Areas 0.4 percent.

Filed Under: Economy Tagged With: Economy, Statin

FX: Selling overwhelms buying

June 19, 2013 by IC Insider.com

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Tuesday, 18th June 2013 | Trading in the foreign exchange market today was dominated by selling of the currencies but at higher rates than on Monday except for the Canadian dollar which fell by 8 cents. The US dollar cost 45 cents more as the selling rate slipped to $101.61 while the buying rate moved up by 58 cents to $100.87. The pound was sold at 48 cents more than on Monday as it took $159.85 top buy a pound. Authorised dealers bought the pound for 89 cents less than yesterday.

A total of US$31.8 million was purchased and US$69.6 million was sold on the day the BOJ two CDS closed. On the closing date of the last two BOJ CDs there were similar levels of trades.

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

Reports of Insider trades

June 19, 2013 by IC Insider.com

Trades by directors or persons or entities connected with company can be a powerful tool as to what may be taking place in a company. That may not always be the case as it all depends on the reasons for each action.

In the Jamaica, there are some companies that have ‘connected parties’ whose trading in the company stock may tell a story as to what can be expected down the road. For example, Mayberry Investment is one company that buying by insiders usually sends a strong message for future prospects. Jamaica Broilers is another company where insider buying and selling more often than not, sends a good message. We list below recent insider trades. Investors can make of them as they see fit.

JMMB | Jamaica Money Market Brokers Limited advised that a connected party sold a total of 5,000,099 JMMB shares during the period June 10 – 13, 2013. Also a connected party sold a total of 426,500 JMMB shares during the period June 4 – 12, 2013.

Honey Bun | Honey Bun (1982) Limited advised that a Director sold 5,000 Honey Bun shares on June 13, 2013.

Sagicor | Sagicor Life Jamaica Limited (SLJ) has advised that an Executive sold 2,000,000 SLJ shares on June 12, 2013.

PanJam | Pan-Jamaican Investment Trust Limited (PJAM) has advised that a director sold 14,200 PJAM shares on June 14, 2013.

MIL | Mayberry Investments Limited (MIL) advised that a related party purchased 26,400 MIL shares on June 14, 201 and that another trade purchase took place by related parties of 238,853 MIL shares during the period June 10 — 11, 2013 and another purchase of 6,739 MIL shares took place on June 5, 2013.

TCL | Trinidad Cement Limited (TCL) advised that two senior managers purchased 207,365 and 99,000 TCL shares on May 14, 2013 and June 4, 2013 respectively and that a person connected to a senior officer purchased 100,000 TCL shares on June 14, 2013.

JAMT | Jamaican Teas Limited has advised that a party related to a director purchased 18,948 shares during the period May 21, 2013 to June 6, 2013.

PURITY Consolidated Bakeries Jamaica Limited has advised that a Senior Manager purchased 18,300, 000 in the company on May 31, 2013.

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

JSE: Mayberry dominated trading

June 18, 2013 by IC Insider.com

Tuesday, 18th June 2013 | Mayberry Investments crossed 66,553,514 Supreme Ventures shares valued at $193,005,191, which they traded for in house purposes. In the process, they sold a few thousand to the market. The trade was one of many such large transactions that the brokerage company put through the market, helping to swell the level of trading above recent days. Many of the crosses resulted on lower prices as the main indices fell by 635.15 points (0.72%) to close at 87,805.82, the All Jamaican Composite declined by 1,118.19 points (1.23%) to close at 89,696.44 and The Junior Market Index advanced by 9.20 points (1.24%) to close at 753.72.

MIL crosses | There was trading in 31 companies, as 121,374,405 units changed hands valued at $329,186,751. The Mayberry trades dominated the following stocks: Berger Paints which traded 2.62 million units, closing 4 cents down at $2.41, Cable & Wireless 37.46 million units closing off a cent at 17 cents, Caribbean Producers with 4.64 million shares down 15 cents at the closing price of $2.20, Gleaner with 644,000 units down 4 cents to close at $1.16, Montego Bay Ice 132.177 units down 5 cents to close at $17.95, Pan Jamaican investments with 115,846 units valued at 6.11 million as the stock price slipped $4.60 closing at $51, Scotia Investments 227,000 units with the price dropping by $1.50 to close at $26.50. Mayberry crosses also dominated in the junior market with the three Lasco companies in addition to the large block of Caribbean Products.

Other stocks to trade in fairly sizeable volume are Carreras which traded 176,486 units at a value of $10.2 million as the stock lost $1.50 to close at $57, Grace Kennedy, 356,794 units between $57.50 and $60 before closing at $57.50 as investors expended $20.7 million on the company’s shares. Sagicor Life with 631,700 units, Scotia group with 304,000 units as it closed at $21.57 off 3 cents on Mondays last traded price.

Price Changes | Other stocks to record noted price changes include: Blue power closed at an all-time high of $8.86 up 16 cents and closed with a bid of $8.90, Carreras lost $1.50, Desnoes and Geddes lost 20 cents closing at $4.90, Grace shed 50 cents on the day, Lasco Distributors lost 15 cents to close at $13.75 Lasco Manufacturing gained 98 cents in closing at $13.75, NCB gained 80 cents at a $21 close.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 6 stocks were higher, with 4 coming from the junior market and 2 stocks that had offers that were lower than their last selling price.

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

TTSE: It’s WITCO again, up $1

June 18, 2013 by IC Insider.com

Tuesday, 18th June 2013 | With 600 shares traded, West Indian Tobacco marched on to new record again in Tuesday’s trading as the stock jumped $1 to close at $114 on a day when 15 securities traded with 5 advancing, 1 declined and 9 traded firm. Guardian Holdings suffered the day’s sole decline, falling $0.45 to end the day at $16.00.

Trading in the main market resulted in 157,621 shares crossing the floor of the Exchange valued at $2,624,514. National Commercial Bank Jamaica traded 60,781 shares for $73,196. National Flour Mills had 30,000 shares trading for $22,500. ANSA Mcal exchanged 19,254 shares with a value of $1,294,200, while Grace Kennedy added 15,163 shares valued at $61,410 to the trading activity.

Clico Investment Fund was the only active security on the Mutual Fund Market, posting a volume of 95,425 shares valued at $2,147,063.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 6 stocks were higher, with 3 stocks that had offers lower than their last selling price, an improvement over Monday numbers. The Indicator points to continued moderate market gains ahead.

52 weeks high | Three stocks traded at new 52 weeks high with Unilever closing with a bid of $52.34 versus the closing price of $52.32 for 396 shares. The stock had 1,226 units trading on Tuesday, there was no stock on offer at the close. The same is true of One Caribbean Media which hit a new 52 weeks high of $17.30 with 800 shares trading.

This market seems poised to price certain stocks higher as supply for a number of them is low. But not all are likely to participate in upward price movement.

Filed Under: Stock Market, TTSE Market Tagged With: Caribbean Producers (CPJ), Daily Trading, Trading Activity, TTSE

KPREIT a medium term investment

June 18, 2013 by IC Insider.com

Funding an operation with low interest rate foreign currency loans while the home based currency is weak can prove costly, and the way the accounting profession treats the changes in currency movement can mean profit or loss at least in the short term. That is what’s happening to Kingston Properties Real Estate Investment Trust (KPREIT) in the latest results to March this year. Revenue was up 13 percent but profit plummeted to a loss, thanks to a foreign exchange loss of $14.5 million incurred in the quarter. The company recorded a net loss of $7.2 million after a tax credit of $3.56 million, but total group comprehensive income was $15.2 million, an increase of 144.8% versus $6.2 million reported for the quarter ended March, 2012.

Revenues | Revenues climbed to $23.5 million in the 2013 quarter up from $20.8 million in 2012. This reflects primarily rental increase for existing tenants and a stronger rental market for new tenants especially at the Loft II in Miami, the company’s management reported.

Group operating expenses, consisting of direct property expenses and administrative costs, were $14.8 million, versus $10.3 million for the similar period a year ago. Direct property expenses include insurance, property taxes, homeowners’ association (HOA) fees, broker fees and repairs & maintenance. These represented 60.4% of operating expenses for the March 2013 quarter versus 58.4% for the similar period last year. Increase in direct property expenses accounted for approximately $2.9 million of the $4.5 million increase in overall operating expenses. The major contributors were repairs & maintenance, HOA fees and property taxes.

Group finance costs were $19.6 million for the quarter compared with $7.4 million for the similar period in 2012. These amounts include unrealized losses of $14.3 million and $2.5 million respectively, due to foreign currency translation losses resulting from the devaluation of the Jamaican dollar.

Balance Sheet | Significant balance sheet assets are Investment Properties of $850 million at the end of the quarter versus $641.4 million at March, 2012 and cash & cash equivalent of $195 million compared with $185.3 million for the similar period last year.

The primary drivers of the increase in the investment properties were fair value gains of $166.3 million on the Red Hills Road property and positive currency impact of $30.3 million on the Miami residential condominiums. Included in cash and cash equivalent is restricted amounts of $168.1 million.

Total group liabilities were $350.3 million at March, 2013 versus $331.5 million at March 31, 2012. These amounts include current and non-current loans payable at the end of the quarter of $325.1 million and $305.2 respectively. The liabilities are primarily mortgage loans. The devaluation of the Jamaican dollar resulted in an increase in the loans which are quoted in the United States dollar and amounted to US$3.4 million at end of March 2013 versus US$3.6 million at end of March 2012.

Cash flow | Net cash provided by operations was $23.9 million for the quarter versus $22.7 million for the similar period last year. A dividend was paid in the March 2013 quarter amounting to $9.9 million, a 63.1% increase over the $6.1 million paid in the March 2012 quarter.

Long term pay-off | Real estate investment is not a good cash generator at least not in the early stage of the investment. By its very nature, the level of income to be made in the short term will be limited. One strategy the company has is the investment in the apartments in Florida that could be disposed of when that market fully recovers and therefore provide cash flow for distribution or capital for expansion. Investors in the stock are likely to have to wait for a while for a big pay day. Nevertheless the stock provides a option to diversify ones investments.

Filed Under: Company News, Company Results Tagged With: JSE Company, Kingston Properties, KPREIT

Guardian ongoing profits up 29%

June 18, 2013 by IC Insider.com

Guardian Holdings, an insurance group primarily involved with life insurance underwriting, reported after tax profit of US$11 million compared to $15 million earned in the first quarter last year. Last year’s results were bolstered by an exceptional foreign exchange gain of $3 million and this quarter’s outcome was impaired by the loss of $5 million derived from participation in Jamaica’s National Debt exchange (NDX). Excluding these two items, the after tax profits results would have grown 29 percent to $16 million.

Premium Income | Gross premiums grew 25 percent from $214 million in first quarter 2012 to $268 million in this first quarter. Excluding $12 million generated from a new acquisitions, gross premiums written grew by 20 percent.

Net results from insurance activities improved 52 percent to reach $20 million from $13 million in the previous year’s quarter. New acquisitions contributed $1 million, in line with management’s expectations.

The new Netherlands-based broker, Thoma, contributed $2 million in fee income. Investment income, excluding the loss relating to the NDX, came in at $36 million compared to $37.7 million in 2012 (exceptional foreign exchange gains are included 2012 figures). The new acquisitions resulted in increased operating expenses and finance charges increasing by 21 percent and moving costs from $32 million in 2012 to $38 million in this year’s quarter.

Segment Results | Premiums written in the Life, Health and Pensions business increased by 16 percent over the comparable period. The Property and Casualty segment’s top line was bolstered by the recent acquisition of Globe Insurance, the quarterly results of which were consolidated into the Group’s figures for the first time, and by low-risk fronting arrangements from which fee income was received. Net premiums written, which are premiums after deducting fronting premiums and reinsurance costs, grew $5 million or 17 percent over the comparable quarter.

Operating profit, while still strong at $7 million for the first quarter, declined $2 million from the 2012 figure due to increased claims activity and the one-off effect of this segment’s portion of the NDX.

Integration | The company’s management said, “they have moved diligently with the integration of Globe and West Indies Alliance and are quite pleased with the achievements obtained to date. Thoma has been fully consolidated into our reporting and contributed $0.65 million to after tax profits this quarter. Although it has occurred after the reporting period, I am pleased to reveal that we have now received all necessary regulatory approvals for our acquisition of Royal & Sun Alliance, Antilles (RSA). Details will be given in the report for the ensuing quarter.

“The Asset Management business contributed $1 million in operating profits for the quarter, down from the $2 million earned in the same quarter last year. This decline is attributable to lower fair value gains in this quarter due to the weak investment climate persisting across the territories in which we do business.”

Assets & Equity | Guardian has the size and equity base to expand and grow profits. As of March, total assets amounts to $3.6 billion with shareholder’s equity of $500 million.

Stock outlook | Earnings per share last year came in at US22 cents or TT$1.40, which is fetching a stock price of TT$17 on the Trinidad stock market giving it an historical PE ratio of 12. Investor’s Choice projects US30 cents per share for 2013 putting the PE at just 9. Compare that to West Indian Tobacco with a rich PE of 27 or Republic Bank with 15 times. It would appear that dividend yield is a major force for the PE differential. WITCO yields around 3.30 percent while Treasury bill rates are under one percent. Guardian has a yield of 3.7 percent.

A buy | Guardian is a good long term investment for a stock that is clearly undervalued in a market where price earnings ratio tend to be much higher than the level Guardian is priced at.

Filed Under: Company News, Company Results Tagged With: Guardian Holdings, TTSE

FX: Selling exceed buying by US$4.7M

June 17, 2013 by IC Insider.com

Monday, 17 June 2013 | Authorised dealers purchased less foreign exchange than they sold today at higher prices than on Friday and sold all three major currencies at higher rates as well. While they bought the US dollar for 29 cents more than on Friday, they sold it for only 7.7 cents more than Friday’s rate as the US dollar sold averaging at $101.164. The Canadian dollar was bought for 61.5 cents more and sold for 45 cents more and the Pound sterling was bought for 54 more and sold for 49 more than on Friday.

US$28.16 was purchased and US$34.65 was sold on a day when C$1.4 million was purchased at an average rate of $97.86 and C$1.2 was sold at $99.95, the Pound sterling accounted for £2.24 million at $156.86 and selling took place at $159.78 as £1.87 million was sold.