Barita’ financials speak eloquently

Financial statements don’t lie; they provide a window into the stewardship of companies for good or bad. There are good management and not so good ones and the financial reports tend to separate the good from the bad. In this regard, investors need to be assured that both interim and audited results are informative and can be trusted.

Barita eyeing expansion

Unfortunately, the stock exchange relies on the ICAJ to set standards for companies to report, but these fall short of what investors need to make a proper assessment in investing. The matter of reporting on the performance of companies to show gross profits separately from pretax profit is an area that is inconsistently applied. Some companies show direct cost and gross profit so investors can see the level of contribution made before selling marketing and administrative cost.
This publication finds Barita’s financials quite up to acceptable levels with disclosures, so why are investors questioning management’s stewardship?
Directors of Barita Investments met on July 14 and are recommending raising additional capital by the Company to be voted on at an extraordinary meeting set for August 3.
The announcement coming after the third such capital raise, with the last being September last year that raised $13.54 billion. The announcement has set off a mini storm within the financial community, with questions raised about the company and what is happening there.

Jason Chambers

Some investors marvel at the approach the directors are taking to fund capital needs. Worse they are asking the question, where has the money raised in public offers gone?
Cornerstone acquired 75 percent of the company in 2019 and set an aggressive dividend policy of 80 percent of net distributable profits. Since they acquired control of the company, profit retained exceeded the total profit reported for the last few years under the former management. But those funds are inadequate to fund the company’s expansion needs, fueled by growth in some critical areas of the Jamaican economy and soon regionally.
In commenting on Barita’s investment activity over the period from its September 2020 Additional Public Offering (“APO”) to March 2021, Jason Chambers, Chief Investment Officer of Cornerstone, said that the Company has “focused on allocating capital across high conviction, value-oriented opportunities.” He cited the marked expansion in credit and investment assets, acquisition of a twenty percent stake in Derrimon Trading Company costing north of J$2 billion as examples of the results of Barita’s year to date investment activity. We have materially expanded capital to our Investment Banking business line. In line with previous guidance, we have also originated and/or acquired significant investment assets, which will eventually form the basis of the launch of new and innovative investment products and structures. We have commenced investing in our footprint expansion and technological overhaul, which we expect will require staged investments over the next several quarters”, Chambers stated.
He cited the doubling of Barita’s 6-month profits to March 2020 as being a by-product of the Company’s ability to deploy the capital it raised in the APO efficiently and profitably. We, therefore, see certain aspects of our business as appropriately funded by long term capital to reduce the risks presented by asset-liability mismatches. This has served us very well, particularly most recently during the height of the market fall-out related to the COVID-19 pandemic last year when Barita maintained healthy liquidity, said Chambers.
Barita Investments was a sleepy little conservatively run investment bank whose directors focused on maintaining the status quo rather than taking advantage of the vast opportunities in the market.

Shareholders at Barita Investments AGM.

The company has gone about raising equity capital, not debt capital, so they don’t have to worry about repayment. They can also vary the aggressive dividend policy, even though that could affect the share valuation.
The argument by investors is reminiscent of two cases. One is the pile of negative comments Access IPO received when going public, back in 2010, by persons who were not adequately informed to be commenting on the issue.  In late 2016, a leading brokerage house concluded their assessment of Barita Investments as follows, “we expect just a marginal increase in year on year net profit. Given this expectation, we estimate BIL shares to be valued at approximately $2.35 by applying the market average P/E to the estimated EPS. Therefore at a current market price of $3.10, we are recommending a SELL on BIL.” At that time, ICInsdier.com placed a BUY RATING on the stock and it occupied the number 2 spot on the main market BUY RATED list.
The rationale by ICInsoder.com, while reported profit was down to $207 million from $242 million in 2015, total comprehensive income, the better measure of profitability was $691 million or $1.55 per share, compared to $201 million, a huge increase. In 2017, traditional profit slipped to $172 million after an impairment on investments charge of $81 million, total comprehensive income ended at $492 or $1.10 per share. For 2018, reported profit jumped to $374 million and total comprehensive income moved to $736 million or $1.65 per share. The lesson, if investors look only at traditional profits, they could miss big gains.
Profit after tax rose from $509 million to $1.04 billion in the March quarter and from $1 billion in the half year ended March 2020 to $2.06 billion in 2021, helped by the improved equity base.
Revenues nearly doubled for the quarter to $2.05 billion from $1.13 billion in 2020 and from $2.26 billion last year to $4.05 billion in 2021.
Total assets are now $79 billion, up from $49 billion at the end of the year ago and $71 billion at the end of September last year. Shareholders’ equity climbed from $14.4 billion in March 2020 to $28.7 billion in 2021. When the majority shares were acquired, total assets were just $17 billion and shareholders’ equity a mere $3 billion. Pledged assets jumped from $21.5 billion in March 2020 to $47 billion in the latest quarter, while loan receivables increased from $1.1 billion to $7.3 billion.

First Citizens Bank closed at 52 weeks’ high on Wednesday.

The 2020 raise of $13.5 billion was invested in increased loans to third parties amounting to $6 billion, net investment instruments of 13 billion and a 20 percent stake in Derrimon Trading amounting to $2 billion and a reduction in amounts due for payables of $5 billion. When the company meets with its shareholders, what is planned for the new raise will undoubtedly be put on the table. In the early months of 2019, this publication pointed to sources suggesting that the first rights issue should bring in fresh capital that is primarily targeted to fund an acquisition that has Caribbean wide locations and will make a big impact on profitability when fully integrated into the existing structure if the deal goes through. ICInsider.com gathers that the deal which is yet to materialize may not be off the table but may be taking longer than originally thought possible. Any fresh raise could well bring such prospects to the fore in addition to funding normal operations.
When all is said and done, First Citizens Bank in Trinidad, a bank group with total assets of J$1,090 billion, bought shares in last year’s APO and added to it subsequently, a strong seal of approval for the strategy Barita is pursuing. With the financial muscle of First Citizens and the small size of Barita there are areas for cooperation, including partnering to acquire assets or businesses. First Citizens is in talks to acquire Scotia Bank assets in Guyana as the bank pushes its regional expansion plans. Will Barita play a major role in this?

National Gas dips again on TTSE

New high for TCL on Thursday after strong Q3 results.

New high for TCL on Thursday after strong Q3 results.

Trinidad and Tobago NGL slipped in trading on the Trinidad and Tobago Stock Exchange on Thursday and ended with 152,082 shares changing hands for a value of $3,494,878. The bid on the stock continues to retreat as it closed with a bid of $22.76 to buy 77 shares, with 1,152 units on offer at $22.97.
Activity on the Stock Exchange, ended with 10 securities trading with 3 stocks closing higher, 1 declined and 6 remained unchanged as a total of 149,046 units, valued at $$1,812,299 changed hands.
At the close the Composite Index ending with a gain of 0.06 points at 1,147.93, the All T&T Index advanced by 0.13 points to 1,950.97 and the Cross Listed Index remained at 45.24.
Gains| Clico Investment Fund closed 1 cent higher with 8,330 shares to end trading at $22.51, National Flour Mills with 8,078 shares trading, gained 4 cents in closing at $2 and Trinidad Cement closed 1 cent higher at a 52 weeks’ high of $3.41 with 445 shares changing hands.
Firm Trades| First Citizens Bank traded 7,811 shares and closed at $35, TTSE sum 29-10-15Guardian Holdings closed with 20 shares changing hands at $12.80, National Enterprises with 11,402 shares changing hands, closed at $16.50, Republic Bank traded 9,936 shares valued at $ 1,112,832 and closed at $112. Sagicor Financial Corporation closed with 50 shares changing hands at $5.75 and Scotiabank traded 21,041 shares for a value of $1,315,062 and closed at $62.50.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 4 stocks with the bid higher than the last selling price and 4 stocks with offers that were lower.

Trading returns to norm on TTSE

Republic Bank may have bottomed out & seems poised to rise.

Republic Bank may have bottomed out & seems poised to rise.

Trading on the Trinidad & Tobago Stock Exchange returned to lower levels investors have become accustomed to in recent months and cooled from high level enjoyed on Thursday when Republic Bank accounted for $30.56 million and Clico Investment with $11 million of the total value of trading.
On Friday the market ended with 11 securities changing hands of which 1 advanced, 4 declined, 6 traded firm, with a total of 642,830 units, valued at $1,697,215 changing hands. At the close, the Composite Index lost 0.43 points to close at 1,161.52, the All T&T Index fell 0.64 points to 1,969.75 and the Cross Listed Index declined by a mere 0.03 points to end at 46.36.
Gains| Unilever Caribbean traded at a new 52 weeks’ high of $66.39 with just 315 units changing hands.
TTSE sum 26-6-15 Declines| ANSA McAl with 700 shares changing hands fell 25 cents to end at $67.25, First Citizens Bank with 1,575 shares trading closed 1 cent lower at $35.75. Grace Kennedy traded 157,665 shares valued at $551,838 for a loss of 3 cents to end at $3.50 and One Caribbean Media had 1,101 units changing hands and lost 2 cents at $22.40.
Firm Trades| Stocks closing with prices unchanged at the end of trading are, CLICO Investment Fund with 8,200 units valued at $185,320 changing hands at $22.60, JMMB Group closing with 362,964 shares with a value of $165,037 to end at 45 cents. Massy Holdings trading 1,647 shares to close at $64.34, National Flour had 104,708 shares changing hands valued at $214,251, to end at $2.05, Republic Bank ended trading with 1,509 shares valued at $173,535 to close at $115. Republic closed with a bid to purchase 7,686 shares at $115 with an offer to sell 1,754 units at $116, an indication that the decline in price may now be over with some recovery may be on the way with the big trade on Thursday. Scotiabank traded 2,446 shares with a value of $152,264 to close at $62.25.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 3 stocks with the bid higher than their last selling prices and 3 stocks with offers that were lower.

Trading remains moderate on TTSE

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TTSEBuilding2_280x150 Trading on the Trinidad Stock Exchange closed with 9 securities changing hands of which 1 advanced, 1 declined and 7 traded firm with a total of 90,027 units, valued at $1,042,001.
At the close of the market, the Composite Index lost 0.17 points to close at 1,159.95, the All T&T Index remained at 1,969.40 and the Cross Listed Index fell 0.05 points to end at 45.99.
Gains| The only stock recording an increase in price at the close is Clico Investment Fund with 29,468 shares trading and advancing by 4 cents to end at $22.55.
Declines| JMMB Group was the sole stock to decline by shedding 1 cent to close at 54 cents with 18,346 shares traded.
Firm Trades| Stocks closing with prices unchanged at the end of trading are, Firstcaribbean International Bank with 10,150 shares changing hands and closed unchanged at $5.03, First Citizens Bank contributed 5,557 shares with a value of $198,941 to close at $35.80. TTSE 25-5-15Guardian Holdings traded 146 shares at $14.20, National Enterprises traded just 13 shares to close at $17.30, Republic Bank traded 200 units to close at $115, while Sagicor Financial Corporation traded 6,297 shares to close at $6.01 and Trinidad Cement with a volume of 19,850 shares traded ended at $2.75.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator shows 4 stocks with the bid higher than their last selling prices and 1 stock with a lower offer.

Moderate trades Friday on TTSE

TTSEBuilding2_280x150 Trading on the Trinidad Stock Exchange closed with 11 securities changing hands of which 2 advanced, 2 declined and 7 traded firm with a total of 60,070 units, valued at $872,353.
At the close of the market, the Composite Index lost 0.13 points to close at 1,160.12, the All T&T Index rose by just 0.06 points to close at 1,969.40 and the Cross Listed Index fell 0.04 points to end at 46.04.
Gains| Stocks increasing in price at the close are, ANSA McAL that traded 300,000 shares on Thursdays had only 1,721 units hanging hands on Friday while gaining 1 cent to $64.05 and Point Lisas Industrial Port Development traded 223 shares and gained 3 cents to end the day at $3.80.
Declines| The stocks declining at the end of trading are, Clico Investment Fund had just 840 shares and declined by 2 cents to end at $22.51 and Scotia Investments lost 5 cents to close at $1.45 with 1,500 shares traded.
TTSE 22-5-15 Firm Trades| Stocks closing with prices unchanged at the end of trading are, Angostura Holdings added 5,785 shares to close at $$13.90, Firstcaribbean International Bank with 30,000 shares changing hands for a value of $150,900, closed unchanged at $5.03, First Citizens Bank contributed 6,893 shares with a value of $246,769 to close at $35.80. National Enterprises traded 154 shares at $17.30, Republic Bank traded 1,923 units to close at $115, while Sagicor Financial Corporation traded 862 shares to close at $6.01 and Trinidad Cement with a volume of 10,169 shares traded ended at $2.75.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 3 stocks with the bid higher than their last selling prices and 2 stocks with offers that were lower.

Ansa Mcal TT$20M trade dominates

Ansa-Mcal-group_logo280x150 Trading on the Trinidad Stock Exchange closed with 9 securities changing hands of which 4 advanced, only 2 declined and 3 traded firm with a total of 619,796 units, valued at $21,385,138.
At the close of the market, the Composite Index rose 0.76 points to close at 1,160.25, the All T&T Index fell 0.08 points to close at 1,969.34 and the Cross Listed Index increased by 0.22 points to end at 46.08.
Gains| Stocks increasing in price at the close are, ANSA McAL closing with 300,000 shares changing hands for a value of $20,112,000, the price gained 2 cents to $64.04, National Commercial Bank gaining 3 cents to end at a new 52 weeks’ high of $1.68 after trading 2,000 shares. Sagicor Financial Corporation traded 1,000 shares to close with a gain of 1 cent at $6.01 and West Indian Tobacco traded 514 shares to close 1 cents higher at $125.28.
Declines|The stocks declining at the end of trading are, Massy Holdings traded 2,362 shares to close with the loss of 1 cent at $64 and Trinidad Cement with a volume of 263,622 shares being traded for $725,128 but lost 2 cents to close at $2.75.
TTSE 21-5-15 Firm Trades| Stocks closing with prices unchanged at the end of trading are, Firstcaribbean International Bank added 10,450 shares to closed unchanged at $5.03, First Citizens Bank traded 2,556 shares to close at $35.80 and Flavorite Foods contributed 37,292 shares with a value of $179,001,to close unchanged at $4.80.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator shows 3 stocks with the bid higher than their last selling prices and 2 stocks with offers that were lower.

Scotiabank jumps to $63 on TTSE

Scotia traded up 49 cents to close at $63 on the TTSE Friday

Scotia traded up 49 cents to close at $63 on the TTSE Friday

Trading on the Trinidad Stock Exchange ended with 11 securities changing hands, 4 advanced, none 2 declined and 7 traded firm, with a total of 374,918 units, valued at $7,339,979.
At the close of the market, the Composite Index advanced by 4.83 points to close at 1,159.62, the All T&T Index added just 2.43 points to close at 1,970.86 and the Cross Listed Index increased by 0.97 points to end at 45.71
Gains| Stocks increasing in price at the close are, Massy Holdings had 5,411 shares changing hands, for a value of $345,492, to end 45 cents higher at $64, National Commercial Bank had 13,787 units changing hands, 15 cents higher at $1.65. Scotiabank contributed 38,143 shares, valued at $2,402,950 and jumped 49 cents to end at $63 and Unilever Caribbean traded 438 units and closed 3 cents up, at a new 52 week high.
Shares declining| Clico Investment Fund ended with 23,987 shares trading, valued at $541,037 but lost 5 cents to end at $22.55 and First Citizens Bank trading 604 shares to close at $35.80, after losing 5 cents.
TTSE 15-5-15 Firm Trades| Stocks closing with prices unchanged at the end of trading are, Guardian Holdings ending with 3,154 shares at $14.20, JMMB Group ended with 1,904 shares trading at 55 cents, National Enterprises traded 1,561 units at $17.30. One Caribbean Media ended with 219 shares changing hands at $22.30, Prestige Holdings closed with 265,096 shares valued at $2,650,980 trading to end at $10. Republic Bank added 10,614 shares valued at $ to close at $115 and Trinidad Cement ended up with 10,000 units at $2.80.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 4 stocks with the bid higher than their last selling prices and 3 with a lower offer.

6 TTSE stocks fall 2 rose Tuesday

NCB is in demand in T&T & traded 750,000 units on Tuesday in that market.

NCB is in demand in T&T & traded 750,000 units on Tuesday in that market.

Trading on the Trinidad Stock Exchange closed with 17 securities changing hands of which 2 advanced, 6 declined and 9 traded firm with a total of 1,125,469 units, valued at $4,040,198.
At the close of the market, the Composite Index fell 0.40 points to close at 1,151.23, the All T&T Index fell by just 1.80 points to 1,964.49 and the Cross Listed Index advanced by 0.13 points to close at 44.31.
Gains| Stocks increasing in price at the close are, First Citizens Bank traded 1,000 shares and closed 2 cents higher at $35.52 and Sagicor Financial Corporation gained 23 cents to end the at $6.25 with 2,000 shares.
Declines| Stocks declining at the end of trading are, Clico Investment Fund trading 73,790 shares valued at $1,660,278 to end at $22.50, with a 1 cent loss. Guardian Holdings trading 9,782 shares while falling by 27 cents to $14.20, National Enterprises in closing at a new 52 weeks’ low with 2,811 closed at $17.33, Republic Bank trading 825 shares while losing 1 cent, to close at $116. Scotia Investments fell 7 cents to close at $1.46 while trading 23,262 shares and Trinidad Cement lost 5 cents while contributing 113,491 shares with a value of $273,930 to end at $2.40.
TTSE 14-4-15 Firm Trades| Stocks closing with prices unchanged at the end of trading are, ANSA Mcal trading 690 shares at $66.91, Grace Kennedy with 610 shares changing hands and ended at $3.55, JMMB Group traded 13,701 shares at 43 cents, Massy Holdings trading 2,868 shares to close at $63.05. National Commercial Bank had 750,063 shares changing hands for a value of $1,125,094 to end at $1.50, National Flour Mills with 120,703 shares being traded for $181,054 closing at $1.50, One Caribbean Media trading 7,555 shares at $22.30, Prestige Holdings with 2,168 shares ended at $10 and Scotiabank trading 150 units to close at $62.11.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 2 stocks with the bid higher than their last selling prices and 1 stock with the offer that was lower.

4 TTSE stocks rose 3 fell Tuesday

Trading on the Trinidad Stock Exchange with 16 securities changing hands of which 4 advanced, 3 declined and 9 traded firm with a total of 252,342 units, valued at $2,209,695.
At the close of the market, the Composite Index rose 1.11 points to close at 1,153.78, the All T&T Index gained 1.97 points to close at 1,978.60 and the Cross Listed Index increased by a mere 0.03 points to end at 43.10.
TTSE 17-3-15 Gains| Stocks increasing in price at the close are, First Citizens Bank trading 2.981 shares to close with a gain of 2 cents at $35.26, Guardian Holdings with 71,200 shares changing hands, for a value of $1,037,220, gained 59 cents to end at a new 52 weeks’ high, of $14.65. Sagicor Financial Corporation trading 490 shares to close with a gain of 4 cents at $5.20, Trinidad Cement with a volume of 51,480 shares traded for $136,422, closed with a gain of 15 cents to end at $2.65.
Declines| The stocks declining at the end of trading are, Agostini’s contributing 283 shares with the price closing 2 cents lower at $17.38, Angostura Holdings added 27,500 shares valued at $398,750 falling 39 cents to close at $14.50 and Scotiabank with 130 shares trading closed down a cent at $62.
Firm Trades| Stocks closing with prices unchanged at the end of trading are, Clico Investment Fund trading 4,681 shares valued at $105,374 to end at $22.50, Flavorite Foods trading 18,607 shares at $4.80, Grace Kennedy trading 1,453 units at $3.59, Jamaica Money Market Brokers while contributing 50,000 shares, closed unchanged at 43 cents. Massy Holdings traded 502 shares to close at $63.37, National Enterprises saw trading in just 11,315 shares valued at $196,297 to close at $17.35, Prestige Holdings traded 1,453 shares to close at $9.91, Scotia Investments traded 10,000 shares in closing at $1.50, and West Indian Tobacco trading 303 units and closed at $125.04.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 6 stocks with the bid higher than their last selling prices and 4 with offers that were lower.

Winners hard to find on TTSE

NCB closed at a new 52 weeks' high on the TTSE on Friday

NCB closed at a new 52 weeks’ high on the TTSE on Friday

With interest rates on the rise and profits under pressure in the twin island state of Trinidad and Tobago, is proving difficult to find winners these days on the Trinidad Stock Exchange. In trading on Friday the market closed with 11 securities changing hands of which 1 advanced, 2 declined and 8 traded firm with a total of 537,112 units, valued at $7,799,050.
At the close of the market, the Composite Index rose 3.05 points to close at 1,149.41, the All T&T Index fell by 0.12 points to close at 1,974.63 and the Cross Listed Index increased by 0.83 points to end at 42.47.
Gains| Stocks increasing in price at the close are, National Commercial Bank increased 12 cents to end at a 52 weeks’ high of $1.35 the equivalent of J$24.37 while it closed at $23.50 on the Jamaica Stock Exchange. The stock closed with a bid of $1.35 to buy 171,500 shares with no stock on offer. In Jamaica there are only 4 offers totalling 109,000 units between $25.50 and $33.
Declines| The stocks declining at the end of trading are, Clico Investment Fund traded with 28,280 shares valued at $636,542 and declined by 4 cents to end at $22.50 and First Citizens Bank contributed 40,141 shares with a value of $1,423,400, and closed 3 cents down at $35.46.
TTSE 6-3-15
Firm Trades| Stocks closing with prices unchanged at the end of trading are, Grace Kennedy traded 28,548 shares to close at $3.60, Jamaica Money Market Brokers with a volume of 82,734 shares at 43 cents, National Enterprises 173 shares to close at $17.40, National Flour Mills 1,500 shares traded at $1.55. One Caribbean Media had 12,224 shares changing hands at $23.95, Point Lisas Industrial Port Development traded 4,557 shares to close at $3.50, Republic Bank added 32,120 shares valued at $3,796,795 to close at $118.21, Sagicor Financial Corporation with 286,835 shares changing hands for a value of $1,462,909 at $5.10.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 2 stocks with the bid higher than their last selling prices and 3 stocks with offers that were lower.