Home' Trinidad and Tobago Guardian : March 10th 2016 Contents MARCH 10 • 2016 www.guardian.co.tt BUSINESS GUARDIAN
NEWS • BG7
Shareholders of Sagicor
Financial Corporation (SFC)
are expected to vote on
whether the financial serv-
ices company should relocate
its registered office from
Barbados to an investment grade location
at this year s annual general meeting (AGM)
in May, SFC group president and CEO,
Dodridge Miller, disclosed on Tuesday.
At the AGM, the Sagicor board expects
to make a single recommendation to share-
holders on the relocation, Miller said.
In a story first reported in the Business
Guardian in January 2015, Miller disclosed
that the board of Sagicor---the holding com-
pany for the pan-Caribbean group---had
approved a recommendation from the man-
agement to prepare a plan to relocate, called
redomicile, its registered office from Bar-
bados to an investment-grade jurisdiction.
SFC s decision to relocate its registered
office was triggered by the December 2014
downgrade of Barbados by Standard and
Poor s (S&P), which led to the rating agency
downgrading Sagicor entities.
The downgrading of SFC s credit rating
increases the interest rate that the company
must pay when it accesses money on the
international capital market.
For example, Sagicor issued a seven-year,
US$320 million bond at 8.875 per cent in
August 2015. That bond was at a substan-
tially higher rate than the ten-year US$150
million, 7.5 per cent May 2006 bond that
it partly refinanced.
T&T is one of at least five countries that
is being considered as the proposed location
of SFC s registered office. The others are
the United States, Luxembourg, United King-
dom and Ireland. In its 2014 annual report,
Sagicor disclosed that 51.33 per cent of the
company s outstanding shares are held by
companies and individuals resident in T&T.
Responding to questions from the Business
Guardian last week, Miller said the company
is at the final stage of its evaluation and
expects to make a recommendation to its
shareholders at its upcoming AGM in May
The SFC president said the final decision
to relocate rests with the Sagicor sharehold-
ers, who are expected to vote on the matter
when they attend at the AGM. He said the
question that "may be placed" before the
shareholders is likely to be in the form of
a "Yes/No" vote as in: Do you agree to re-
domicile SFC from Barbados to Country A."
Miller also said: "Subject to one final
piece of tax advice, we are ready to make
a single recommendation to our sharehold-
Asked whether it is possible that the out-
come of the process could be a decision to
maintain domicile in Barbados---as was the
case of global bank HSBC, which decided
to maintain its domicile in London---Miller
said: "The drivers of the decision for the
two companies are somewhat different.
HSBC, as I understood it, was concerned
with the possibility of a changing regulatory
and taxation environment in London. That
concern has since abated.
"Sagicor, on the other hand, is concerned
fundamentally with the declining credit rat-
ing of its current domicile Barbados. We do
not expect any dramatic improvement in
this rating over the medium term. Our rec-
ommendation to re-domicile is not likely
Sagicor had originally said that the process
of arriving at a recommendation would have
been completed by the end of 2015.
Explaining this delay, Miller said that the
relocation of a corporate head office "is an
unusual event for a Caribbean company and
it therefore took the company, regulators,
tax authorities and tax advisers a bit longer
to consider all of the relevant implications."
Sagicor, which was previously named Bar-
bados Mutual, has been domiciled in Bar-
bados since 1840.
Sagicor shareholders to vote
on redomicile at May AGM
Caribbean Airlines Ltd (CAL)
is reporting an increase of
1.43 per cent in visitor
arrivals between the period
January 25 and February 15,
2016. In a statement, the
airline said for 2016 it operated 840 inter-
national flights and brought more than
71,000 visitors to T&T for Carnival. This
can be compared to 2015 when the airline
brought 70,000 visitors.
Extra capacity was added to the New
York and Jamaica routes because, "these
are traditionally high volume routes" the
airline said. Adding that the increased
capacity did not result in increased expen-
diture as these additional services, the air-
line said were budgeted for.
Dionne Ligoure, head of corporate com-
munications, said Carnival is one of the
busiest time of year for CAL and the airline
was satisfied with the performance. For
that period the airline used social media
as a form of connecting with its customers
as they were invited to upload their photo
on the airline s social media. Passengers
who shared their photo on social media for
a time period were entered in a competition
to win 15,000 frequent flyer miles.
Ligoure, who was also outlining how the
company planned to cope in 2016 and a
contracting economy, said the airline
reached more than 275,000 people inter-
nationally through social media but "the
choice of media would depend on the target
audience and the destination. Social media
is a growing channel but traditional adver-
tising also has a solid place in CAL s pro-
Looking at the airline s external environ-
ment, Ligoure said CAL, like other airlines,
has benefitted from declining oil prices but,
"lower oil prices are a double-edged sword,
since reduced prices also hurt those
economies heavily tied to petroleum. Coun-
tries and areas such as Texas, western Cana-
da, Nigeria and Norway are all seeing their
GDP being negatively impacted and T&T
is no exception. Also, we ve seen a decline
in the travel spend of those firms and people
tied to the petroleum sector."
And, as many companies examine their
operations during a recession to determine
what aspect can be improved, CAL stated
that in February it improved its upgrade of
its reservations and airport check-in system
The first phase started in December 2015
and now that the upgrade is completed, it
will assist in improving customer service
for the airline such as: faster and easier
Web check-in, simpler ways to buy tickets,
real-time information on reservations and
flight changes and self-serve, user-friendly
airport kiosks at Caribbean s destinations.
Asked how has the airline been impacted
by the decline in aviation fuel costs, she
said within the industry the decline rep-
resents both an opportunity and a threat
to most airlines.
"For CAL, the decline has supported
other cost-savings initiatives being at the
company. We have also been proactive in
better engaging with our customers so that
our service and schedules are more in line
with their needs."
CAL s financial performance has improved
in 2015 compared to 2014.
"Caribbean Airlines remains focused on
improving efficiency and reducing costs.
What we can say, at this time, is that there
was a significant improvement in 2015 over
the 2014 financial performance. Our
finances for 2015 are currently being audited
and finalised and must first be shared with
our corporation sole before any disclosure
is made to the public. We will be delighted
to share the information at that time."
She added that, for 2016, the airline
would be focused on improving the cus-
"We have started a programme of product
improvement and 2016 will be a significant
transformation year. The transformation
has already begun, with the introduction
of Amadeus. We have also upgraded our
passenger revenue accounting (PRA) system.
The new PRA will give Caribbean Airlines
the ability to better manage the control,
reporting, use and accounting of tickets,
miscellaneous charge orders, refunds, ancil-
lary revenue and other related financial
"We have engaged in a green field sched-
uling review with the primary objective of
improving aircraft utilisation. The first
result of this review has been servicing the
same routes and frequencies with less air-
craft thus improving our aircraft utilisation.
A second review is currently underway."
CAL sees 1.43% increase in Carnival arrivals
Airline: 2016 is a transformation year
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