Home' Trinidad and Tobago Guardian : November 8th 2015 Contents NOVEMBER 8 • 2015 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
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After it was founded in 1875,
HL Horsford was incorpo-
rated in 1912 and then
became a public company
The company is involved in retail, service
and manufacturing businesses and has traded
profitably since its incorporation. Its actively
trading subsidiaries are Ocean Cold Storage
(St Kitts) Ltd, SL Horsford Finance, SL Hors-
ford Nevis Ltd and SL Horsford Shipping Ltd.
With all the current interest concerning
potential brewery acquisitions in both Bar-
bados and Jamaica, readers should be aware
that Horsford s owns 20.1 per cent of Carib
Brewery (St Kitts and Nevis) Ltd; the majority
52.43 per cent of the brewery s shares are
held by ANSA McAL Ltd.
Let us review its operations for its last
fiscal period ending on September 2014 along
with some comments for the nine months
ended June 2015.
Changes in financial position
Total assets advanced to EC$170.8 million
(about TT$410 million) from 2013 s EC$162.4
million, or by 5.2 per cent.
Current assets rose to EC$48.3 million from
EC$44.2 million. Major components, current
accounts receivables and inventories, both
registered higher values. The former closed
at EC$11.6 million from the earlier period s
EC$10.9 million while the latter moved from
EC$32.6 million to EC$36 million as at Sep-
All three components of inventory rose.
Merchandise values advanced to EC$28.9
million from EC$27.2 million; stock on hire
rose to EC$3.7 million from EC$2.5 million
while goods in transit ended at EC$3.3 million
(2013: EC$2.5 million).
Total long-term assets ended at EC$122.5
million from the previous year s EC$118.2
The largest component, property, plant
and equipment was marginally higher at
EC$98.7 million from EC$97.8 million.
Non-current accounts receivable jumped
from EC$8.4 million to EC$11.8 million.
Investments in associated companies were
steady at EC$11.4 million for both periods;
of some note was the swing in the share of
net income less dividends from a negative
EC$849,000 in 2013 to a positive EC$179,000
in 2014. This movement helped mitigate the
EC$1.2 million decline in equity.
Total liabilities rose by 9.5 per cent to
EC$51.2 million from EC$46.8 million.
Current liabilities increased to EC$35.1 mil-
lion from EC$31.5 million. The largest com-
ponent, loans and bank overdrafts, advanced
to EC$23.5 million from EC$22.1 million.
Notably, the overdraft component declined
to EC$2.3 million from EC$5 million.
Accounts payable and accruals rose from
EC$8.8 million to EC$9.9 million. This
increase was mostly attributable to trade
payables, which advanced to EC$6.3 million
from EC$4.9 million; sundry payables and
accruals fell to EC$3.6 million from EC$3.8
In line with its higher profitability, provision
for taxation rose to EC$1.7 million from
EC$0.6 million. Long-term loan balances
closed at EC$9.8 million from the previous
level of EC$9.6 million.
Its deferred tax liability advanced to EC$6.4
million from EC$5.8 million.
Total equity rose to EC$119.6 million from
EC$115.6 million with share capital of EC$30.1
million being stable for both periods.
Total reserves closed at EC$89.4 million
from 2013 s EC$85.5 million. Within this cat-
egory, retained earnings advanced to EC$50.4
million from EC$46.3 million. Here, the major
movements were total comprehensive income
of EC$7.7 million, which was reduced by div-
idends of EC$3.6 million.
With 30,148,430 shares outstanding, each
share had a book value of EC$3.97 (September
Revenues and profit
Stronger economic growth in both St Kitts
and Nevis helped fuel sales growth of 18.53
per cent. This measure advanced to EC$143.2
million from EC$120.8 million.
The cost of sales, however, climbed by 19.6
per cent, moving from EC$92.7 million to
EC$110.9 million. This restrained gross profit
growth to 15 per cent as it registered at
EC$32.3 million from the previous year s
Other income advanced to EC$8.36 million
from EC$7.97 million. The major component
was interest, which declined by 8.1 per cent
to EC$3 million from the previous year s
EC$3.27 million. In line with a more buoyant
economy, car rental income improved to
EC$1.55 million from EC$1.38 million. Also
benefitting was shipping income, which
jumped by 39.4 per cent to EC$1.37 million
from the previous level of EC$980,000.
These changes brought total income to
EC$40.68 million from EC$36.1 million,
reflecting a 12.7 per cent improvement.
Total expenses rose to EC$32.4 million
from EC$31.5 million. The largest component,
administrative expenses, advanced to EC$21.6
million from EC$21.2 million.
Within this grouping, two major swings
accounted for the bulk of the change. First,
there was a welcome fall in utilities costs,
which registered at EC$2.27 million from
EC$2.97 million. On the other hand, employ-
ment costs rose by almost EC$1 million to
EC$15.6 million from EC$14.6 million; this
increase was implemented to compensate
employees for the 2013 freeze in wages and
These changes resulted in net income of
EC$8.26 million, reflecting a robust 81.4 per
cent improvement over the 2013 result of
The share of results from associated com-
panies slipped to EC$3.69 million from
EC$3.91 million. Later, we will delve more
into those results.
These movements allowed Horsford s to
report pre-tax income of EC$11.95 million
versus EC$8.46 million previously. At the
after-tax level, the 2014 result was EC$7.7
million compared with EC$5.46 million for
the previous year.
These results translated into EPS of
EC$0.26 versus EC$0.18 for 2013.
The durable goods segment includes the
sale of building materials, furniture and appli-
ances. This segment registered sales growth
of 10.3 per cent and pre-tax profit improve-
ment of 50 per cent.
The automotive business includes the sales
and servicing of cars and rentals of same.
This segment saw its sales expand by 47 per
cent while pre-tax income exploded by 109
Consumable goods include the sale of food
and gas. Here, sales improved by 17.1 per cent
while pre-tax income rose by a robust 113
The associated companies
Horsford s three associated companies are
Carib Brewery (SKN) Ltd (20.1 per cent), St.
Kitts Masonry Products Ltd (50 per cent) and
St. Kitts Development Ltd (30 per cent). The
latter develops housing sites on 200 acres of
land at Half Moon Bay, St Kitts.
The two combined St Kitts companies
delivered 2014 revenues of EC$22.1 million
(2013: EC$26.2 million) while profits declined
to EC$3 million from EC$5.1 million. Divi-
dends from these sources fell to EC$1.28 mil-
lion from the previous year s EC$2.2 million.
Carib Brewery s sales advanced to EC$38
million from EC$30.9 million, reflecting
growth of 22.7 per cent. In addition, profits
expanded by 32.3 per cent to EC$8.22 million
from EC$6.21 million. Dividends received
from Carib for both periods were stable at
EC$1.485 million. (The peculiarities of group
reporting seem to restrict ANSA McAL share-
holders from having access to similar detailed
information about Carib Brewery s operations
here in Trinidad.)
Nine months report to June 2015
Sales for this period grew by 12.2 per cent
to EC$115.4 million from EC$102.9 million.
The gross profit margin improved to 21.3 per
cent from 20.7 per cent. This allowed Hors-
ford s to report gross margin of EC$24.55
million from EC$21.24 million.
Other income rose by 2.9 per cent to
EC$11.28 million from EC$10.96 million.
Consequently, gross revenue registered at
EC$35.8 million from last period s EC$32.2
million, representing growth of 11.3 per cent.
Total expenses increased by 6.1 per cent
to EC$26.7 million from EC$25.1 million.
Notably, building and insurance expenses fell
by 2.23 per cent to EC$3.58 million from last
year s EC$3.66 million. On the other hand
and consistent with the reasons given earlier,
employment costs rose by 8.1 per cent to
EC$12.8 million from EC$11.9 million. In
addition, selling expenses increased by 9.5
per cent to EC$3.8 million from EC$3.48
These changes allowed Horsford s to report
pre-tax income of EC$9.14 million; this rep-
resented an increase of 29.5 per cent over
the EC$7.06 million earned for the compar-
ative 2014 period.
During the period, its furniture and appli-
ance showroom was remodelled as an "Ashley
Furniture Home Store"; this exercise cost
EC$850,000. In addition, EC$600,000 was
spent at Valu Mart Supermarket to install
additional solar panels and pave the car park.
Chairman W Anthony Kelsick, is confident
that, as the local economy continues to do
well, Horsford s profitability will benefit from
Share price and dividends
The total dividend for fiscal 2014 was
Although there have been intermittent
trades on the Eastern Caribbean Stock
Exchange, Horsford s (Symbol: SLH) share
price has remained stable at EC$1.80 for at
least two years.
At that price, the dividend of EC$0.15 pro-
vides investors with a yield of 8.33 per cent.
Strong economic growth fuels higher
profits at St Kitts & Nevis' SL Horsford
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