Home' Trinidad and Tobago Guardian : September 26th 2013 Contents Part 2
Last week, we started to review
the changes in share prices of
local companies over the five-
year period September 12, 2008,
to September 13, 2013.
Like all living beings, companies change
over time. Most become better, while others
lose their original identity as they morph with
other organisations that can help them perform
to their true potential. Others, those that refuse
to change, eventually die a natural death. We
will now continue with our comparisons and
comments of some other locally listed com-
The Jamaican companies
As we saw last week with GraceKennedy, the
Jamaican-based companies posted negative
share price changes for the period covered.
A share of Jamaica Money Market Brokers
Ltd (JMMB) would have cost you $0.95 on Sep-
tember 12, 2008. To your chagrin, this share
would have been worth only $0.50 on September
13, 2013. This represents a loss in value of 47.4
Hopefully, the company s 2012 acquisition of
Credit and Capital Financial Group (CCFG) and
the locally-based Intercommercial Bank Ltd,
which was recently approved, should help restore
the fortunes of this financial group.
In a similar vein, the National Commercial
Bank of Jamaica Ltd (NCBJ) saw its share price
plummet from the 2012 level of $1.98 to the
mid-September 2013 price of $1.15. Again, we
have a huge price contraction; in this case, it
was $0.83 or 42 per cent over the same time
NCBJ is hoping to complete the acquisition
of Trinidad-based AIC Securities Ltd in the
near future. Because of the persistent risk for
devaluation of the Jamaican dollar, Jamaican
companies are increasingly interested in making
acquisitions of companies that operate in stronger
economies with more stable currencies.
Finally, Scotia Investments Jamaica Ltd (SIJL),
though also experiencing a price contraction,
the pain to investors was more muted. In this
case, the price moved from $2.45 in 2008 to
$2.05. The fall of $0.40 represented a more
restrained 16.3 per cent decline from the 2008
In common with most other Jamaican com-
panies, SIJL suffered from the National Debt
Exchange programme. Recovery from this set-
back could start in the later part of 2013 or early
2014. SIJL is part of the Scotia Group Jamaica
Limited, from which it can draw considerable
financial and technical resources.
Some of the more frequent cries of man-
ufacturers include labour costs, market access
and delays in clearing items from customs.
Larger companies are better able to deal with
these challenges than smaller ones.
The share price of Unilever Caribbean Ltd
(UCL) advanced by a healthy $34.36 to close
in mid-September 2013 at $55.41. This rep-
resents a robust 163 per cent improvement
from its base price in September 2012 of $21.05.
Ably supported by a dynamic and forward
thinking parent, the local company has access
to considerable resources to assist it with mar-
ket penetration, human resources and financial
A similar comment can also be made for
West Indian Tobacco Company Ltd (WITCO).
In this case, its share price accelerated by an
astronomical 281 per cent over the five-year
period as it advanced to $118.00 from its mid-
September 2008 price of $31.03.
An additional factor that helps this company
is that legislation in many countries essentially
bans it from spending on advertising; with
such an addictive product as its mainstay, who
needs to "waste" funds on advertising and
Berger Paints Trinidad Ltd s share price
improved modestly from its September 2008
level of $3.25 to $3.60 on September 13, 2013.
Over the past five years or so, sales have
not improved appreciably. These ranged from
a low of $56 million for the twelve months to
December 2008 to a high of $64.15 million
for the 12 months to March 2013. In 2009,
the company changed its fiscal year from
December to March to coincide with that of
The share price for Flavorite Foods Limited
advanced by 28 per cent to reach $8.22 from
$6.42 five years ago. Against strong compe-
tition, particularly from foreign sources, this
ice cream manufacturer continues to hold its
The company is expanding on two fronts.
In January 2012, it purchased Romike Ltd. In
addition, it holds a franchise for a prominent
premium ice-cream maker.
What more can we say about Trinidad
Cement Ltd? From a lofty share price of $9.25
back in mid-September 2008, shares in this
company can now be had for a modest $1.95.
This represents a contraction of 79 per cent
over this period.
Some of the factors that have contributed
to this share price decline include: weak
demand, occasioned in part by the "global
recession", huge debt and poor timing of its
Jamaican plant expansion. In 2012, it endured
a 92-day labour strike.
Currently, shareholders are opposing its
slate of candidates to serve as directors and
have offered a new team. This matter is expect-
ed to come up for hearing on September 30.
If it is still in existence in its current form,
perhaps, the next five years might be kinder
to this group?
Readymix (West Indies) Ltd is a 71.1 per
cent owned subsidiary of Trinidad Cement
Ltd. Its other major shareholders are Clico
Insurance with 5.59 per cent ownership and
Republic Bank Ltd with a 12.75 per cent stake.
Most of the comments made about its par-
ent, TCL are generally applicable to Readymix.
Over the five-year period, the share price
declined from $31.60 in mid-September 2008
to $21.99 on September 13, 2013. In comparison
with TCL, RML s price contraction of 30.4
per cent is quite mild. The main reason for
this is that the security is rarely traded; this
is mainly because of its much more concen-
trated ownership structure.
Back in the heyday of 2008, RML recorded
sales of $301 million and profit attributable
to shareholders of $35.2 million. On that basis,
a final dividend to shareholders of $0.20 was
paid in June 2009. Since then, sales and profit
have been elusive. In 2012, Sales reached $136.5
million and there was a loss attributable to
shareholders of $6.5 million.
The price of Angostura Holdings Ltd moved
from its base of $7.49 in mid-September 2008
to close on September 13, 201, at $10. This
represents a gain of 33.5 per cent.
The last five years were very eventful for
this company, which endured 19 months of
suspension on the TTSE from July 13, 2009
to February 13, 2011. This trading blackout
was due to the company s failure to produce
its audited accounts for 2008 and 2009. This
lapse related to the AHL s complex and con-
tentious relationship with its two largest share-
holders, CL Financial and Clico Insurance.
Following the accounting "write-off" of the
debts in question, the auditors signed off, the
results were published and trading in AHL s
In early March 2011, the price dropped to
$5.00 where it stayed for almost one month.
By May 17, 2011 the share price reached $10.00.
For the next two and one-half years or so, the
price fluctuated between $7.70 and $9.50.
In the interim, dividend payments, though
small, have resumed; debts due by Clico Insur-
ance were settled and companies, including
Burns Stewart, have been sold. Also, Euro-
denominated debt has been repaid at a profit.
There are recent signs that the company
has re-focussed on its core business. In the
not too distant future, the outstanding debt
of $984 million due from CL Financial will
be settled, either in cash or assets. There is
also the possibility of partial divestment by
either CL Financial or Clico.
National Flour Mills
Based solely on the price comparisons from
2008 to 2013, National Flour Mills Ltd s share
price hardly budged. For the relevant periods,
NFM moved from $0.81 in 2008 to an ex-
dividend price of $0.75 in mid-September
2013. A dividend of 8 cents is being paid to
shareholders on September 23, 2013.
Over this period, non-government share-
holders have had cause to complain about
apparent government interference in the pricing
of its products.
The company now faces increased compe-
tition from private interests.
Sales peaked in 2008 at $631 million and,
in 2009, came in at $495 million. Since then,
sales have generally held at around the $440
million level. Profits ranged from a high of
$18.4 million in 2010 to a loss of $18.9 million
in 2008. In 2012, NFM recorded a profit of
$13.3 million on sales of $446 million.
This share is regularly traded. Over the five-
year period, it fell to a low of $0.57 on April
16, 2009 and reached its highest point of $1.05
on June 2, 2010.
Over our five-year time-frame, the share
price of Prestige Holdings Ltd accelerated by
a robust 136 per cent. Starting at $4.00 on
September 12, 2008 it closed at $9.40 on Sep-
tember 13, 2013. The share price fell to a low
of $2.75 on February 26, 2009.
PHL extricated itself from unprofitable for-
eign markets, notably The Dominican Republic.
Soon afterwards, it bought Mainstream Foods
Ltd, the franchise holder for Subway Restau-
The simultaneous announcement of these
two major events on December 2, 2011, was
sufficient to initially lift the share price to
$7.00. Since then, PHL s share price has main-
tained its upward trajectory.
In order to finance the Subway purchase,
PHL borrowed $65 million at 7.5 per cent
interest from its parent company, Victor E
Mouttet Ltd. To bridge the $110 million pur-
chase price, it secured a vendor loan of $45
In June 2013, using a new $140 million bond
that has a fixed coupon of 6.25 per cent, it
was able to repay the $45 million vendor debt
to Mainstream Foods Limited, pre-pay higher
cost bonds and settle some short-term financ-
Next week, we will conclude our review
of share price movements on the local stock
exchange over the last five years.
SEPTEMBER 2013 • WEEK FOUR www.guardian.co.tt BUSINESS GUARDIAN
STOCKS | BG15
A five-year review: (2008--2013)
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