Home' Trinidad and Tobago Guardian : September 5th 2013 Contents SEPTEMBER 2013 • WEEK ONE www.guardian.co.tt BUSINESS GUARDIAN
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From Page 4
Studying new investments
His vision for NEL in 2013 is to increase its
investments in companies listed on the T&T
Stock Exchange (TTSE) to increase shareholder
"First Citizens initial public offering is one
(of the targeted investments. if Home Mortgage
Bank comes up---and it is an attractive invest-
ment---we ll consider that, then, there are
other investments we are looking at," he said.
Explaining the investment rules which NEL
must abide by, Lue Chee Lip said: "We (NEL)
are majority owned by the Government of
T&T, so if we as a board consider this invest-
ment as attractive and we bring it to the Gov-
ernment, Minister of Finance Larry Howai
can then give me the go ahead to consider it,
then we would consider it. It s a process. We
ask for approval first, once we get the approval,
then we start to do due diligence. Only until
financially it looks attractive, and there is little
risk, then we return to the Minister of Finance
and Cabinet to get the approvals."
He said NEL was an entity which no one
wanted to be the chairman of because "if you
are looking to make money, NEL is not the
vehicle to try to make money out of it.
"It has potential because we handle $500
million a year in income, but we only spend
three as expenses. NEL has always seemed to
be an honest, straightforward government
entity. Nobody could say that NEL can be
blamed for any corrupt or any underhand
According to its unconsolidated financial
statements for 2013, net profit after tax is $497
million, which can be compared to $479.5 mil-
lion reported in 2012. Declaring that NEL s
success comes from having the right leadership,
Lue Chee Lip said he brought his astute entre-
preneurial skills to NEL.
"Before my time, NEL didn t do anything
(in terms of performance). Over the last ten
years, NEL had the same plate and hasn t
grown. They accumulated funds every year,
ten per cent of the dividends, accumulated,
accumulated, when I came in here, I saw that
as great potential. From a business perspective,
how do you take several hundred million dollars
that you have in your kitty and do something
worthwhile for the shareholders and for the
country? That is what we are working on right
Giving details on why NEL is a viable invest-
ment, he said, since its inception, NEL has
paid three to four per cent earnings per share.
"The share price, when I came on board in
March 11, was $11.40; now it is $16. In two
years, you have seen a 40 per cent increase.
You can t get that kind of returns on any kind
of investment. Like any investment, they
always tell you there is risk."
Prior to taking up his role as chairman, the
49-year-old said he was an engineer and
owner/operator of Control Technologies Ltd.
One of the projects his company has been
part of is the laying of telecom systems for
the cross-island pipeline laying project.
"I boast we put up the tallest free-standing
pole in the island."
The T&T Stock Exchange-listed NEL will
hold its annual general meeting at the end of
September and is expected to reveal its plans.
Commenting on the improved reporting
requirements which the TTSE requires, Lue
Chee Lip said: "It just makes our work a little
He said the company has to issue quarterly
Giving his views on the viability of a regional
stock exchange, Lue Chee Lip said it is an
"interesting prospect" for T&T as it opens up
financial markets and capital flows into T&T.
"It opens up that possibility for not only
NEL, but all the other companies on the
exchange. Therefore, we could start appreci-
ating in value, therefore become more valuable
to the holders of these shares.
"I think allowing other individuals or coun-
tries to be able to buy shares; it s only positive.
For NEL it opens up the door to a lot more
because share prices are always based on
demand and supply. If there is a bigger demand
for shares, the price would go up."
Regarding the slow pace of small and medi-
um enterprises listing on the TTSE, he said
entrepreneurs generally do not like to give up
"It s a trade-off between raising funds on
the TTSE versus other ways of raising funds
and giving up control. On top of giving up
control, you have shareholders who are going
to demand certain things. Being your own
boss is something Trinidadians don t like to
give up. That s one of the reasons why we
don t see more of it. But then, how many
companies out there want to share their profit
"Once you go to the stock exchange, it means
you have to share your profits. A lot of the
profitable companies prefer to keep their money
to themselves and have other ways of raising
money. It seems that the SMEs locally have
no need for that, and that s why we have so
much liquidity in the market as well."
Declaring that this Government has "done
more" to stimulate the equity market, he said
there seems to be more interest in individuals
TSTT is one of the companies in NEL.
"It is one of our challenges that we have
to look at: How can we ensure the viability
of TSTT? The management of TSTT has
already alerted us. There are some changes
that need to be made at TSTT that they have
to finalise and bring to us. TSTT, in the short-
term, I see it continues to be a challenge. TSTT
is a valuable company in the economy and
we have to ensure that it remains viable," he
Asked what are the proposed changes to be
made at TSTT, Lue Chee Lip said he didn t
want to divulge any of its strategies.
NEL 2103 after-tax profit:
Kenny Lue Chee Lip, chairman, National Enterprises Ltd.
PHOTO: ROBERTO CODALLO
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