Home' Trinidad and Tobago Guardian : April 27th 2014 Contents Buoyed by the robust con-
tribution made by its insur-
ance and financial services
sector and a significant
reduction in its interest
costs, ANSA McAL Ltd
delivered a strong perform-
ance in 2013. Let us look closer at some of
Total assets expanded by 8.2 per cent to
$12.2 billion from the restated 2012 figure of
$11.3 billion. Growth in current assets was
most prominent as the value of this sub-class
increased by 12.1 per cent to $6.27 billion from
the previous year s $5.59 billion. The most
significant change was in the cash and short-
term deposits component, which moved from
the 2012 base of $1.53 billion to last year s $2.15
billion; this represented an increase of almost
40 per cent.
On the other hand, investment securities
declined from $1.37 billion in 2012 to $1.20
billion last year. Significant movements were
noted in the values of equities and government
bonds. The value of the former almost doubled
to $600 million (2012: $316.2 million). In the
case of the latter, the 2013 value contracted
by nearly 72 per cent to $149.5 million from
$530.4 million in 2012.
Also exhibiting a positive trend was the cur-
rent portion of loans and advances. This line
item increased by 10.1 per cent to $608.7 mil-
lion from the previous year s balance of $552.7
The aggregate of non-current assets rose
by 4.3 per cent to $5.96 billion from 2012 s
$5.71 billion. Similar to what was previously
noted with loans and advances, the long-term
portion of this category increased by 11.7 per
cent to $1.36 billion from the previous year s
Another significant increase was recorded
in the value of employee benefit asset, which
advanced 22.5 per cent, or from $689.2 million
as at year-end 2012 to $844.1 million last
December. Primarily, this is the value by which
the fair value of the defined benefit plan assets
exceeds the present value of its future obli-
Under this type of plan, the employer, as
sponsor, assumes all the investment risk and,
consequently, is allowed to include any surplus
from the plan s assets on its books.
Total liabilities increased by 4.4 per cent to
$6.25 billion from 2012 s $5.98 billion. The
non-current portion declined to $2.63 billion
from 2012 s $2.75 billion. Meanwhile, the cur-
rent portion increased by 12 per cent to $3.62
billion from the previous year s $3.23 billion.
The major declines in the values of the non-
current liabilities occurred under "customers
deposits and other funding instruments" and
"medium and long-term notes". In the case
of the former, year-end values moved from
$354.7 million in 2012 to $314.8 million last
With respect to the latter, the figures
declined from $669.1 million in 2012 to $510.9
million last December.
These same descriptive elements were also
responsible for the increase in the values of
current liabilities. Medium and long-term
notes increased from a zero balance in 2012
to $161 million last year-end. Similarly, cus-
tomers deposits and other funding instruments
rose from $2.06 billion as at December 2012
to $2.39 billion last year-end.
Shareholders equity rose by $590.6 million
to close 2013 at $5.29 billion from 2012 s $4.7
billion. The reserves were boosted by the cur-
rent year s profit of $742 million and only
modestly depleted by the payment of dividends
to shareholders of $189.6 million.
Resulting from these changes, the book
value of each share improved to $30.73 from
$27.28 as at December 2012.
Income and profit
Total revenues for 2013 rose by 5.5 per cent
to $6.22 billion from 2012 s $5.89 billion. How-
ever, operating profit rose at a stronger pace
of 13.7 per cent to register at $1.16 billion from
the $1.02 billion earned in 2012.
Helping to fuel this improvement was a sig-
nificant reduction in the impairment on invest-
ment securities and lower administrative and
In the case of the former, the amount fell
from $102.8 million in 2012 to $19 million last
year; this reduction primarily related to its
84.23 per cent owned subsidiary, ANSA Mer-
chant Bank Ltd.
In the case of the latter item, these costs
declined from $683.8 million in 2012 to $626.5
million; this reduction of 8.4 per cent translated
into an annual saving of $57.3 million.
Staff cost increased at a significantly slower
pace than the growth in revenues. At 3.4 per
cent, this component moved from $540 million
in 2012 to $558.5 million last year.
With the reduction (by almost $80 million)
and re-profiling of the company s debt, interest
expenses declined from $97.8 million in 2012
to $47.4 million last year.
In addition, the group s share of the results
from associates and joint ventures increased
to $27.2 million from $19.2 million in 2012.
Despite lower sales, these companies, which
include Trinidad Lands Ltd, delivered higher
profits; this improvement was due to signif-
icantly reduced cost of sales and lower admin-
These changes saw 2013 pre-tax profit reg-
ister at $1.14 billion; this was 20.9 per cent
greater than the $946.1 million recorded for
In 2013, the effective tax rate was 23.6 per
cent, which was higher than the 21.8 per cent
for 2012. In 2012, the tax take of $205.9 million
brought that year s profit down to $740.2 mil-
lion. Last year s tax of $269.5 million reduced
the profit to $874.6 million.
The figure attributable to minority interests
of $132.6 million left $742 million as the amount
attributable to shareholders. This translated
to EPS of $4.31 versus $3.67 for 2012.
ANSA McAL groups its various subsidiaries
under four major headings: manufacturing,
packaging and brewing; automotive, trading
and distribution; insurance and financial serv-
ices; media, services and parent company. The
table above provides some key figures for these
segments for both 2012 and 2013.
Although the automotive, trading and dis-
tribution segment saw its revenues increase
by modest 5.5 per cent to reach $2.55 billion,
their pre-tax profit rose by a strong 15.7 per
cent. This result was probably influenced by
the strong growth in new car sales.
With minimal growth in third party rev-
enues, the insurance and financial services
segment delivered a 130.6 per cent improve-
ment in pre-tax profit. This robust result was
helped by a huge one-off reduction in its pro-
vision for impairment on investment securi-
At the manufacturing, packaging and brew-
ing segment, sales grew by 6.2 per cent. This
division also benefitted from a 95 per cent
reduction in its interests costs. Despite these
positives, pre-tax profits declined to $466
million from $479 million a year earlier.
The group s 56.17 per cent owned subsidiary,
Guardian Media Ltd, produced a 25.8 per cent
increase in its pre-tax profit last year to $58.8
million. However, this robust result was insuf-
ficient to boost the fortunes of the media,
services and parent segment.
Here, sales advanced by 8.2 per cent and
interest costs declined by a helpful $20 million.
Despite these positives, pre-tax profits con-
tracted by 12.1 per cent to $147 million from
the $167 million earned in 2012.
Geographical source of revenues
The majority of the group s revenues was
generated in T&T, which, in 2013, accounted
for 73.4 per cent of the total. Local sales
improved from $4.25 billion in 2012 to $4.57
billion last year, or by 7.3 per cent.
Barbados-based revenues accounted for 18.5
per cent of the total for 2013; in 2012, this
territory accounted for 20.2 per cent of the
group s total revenues. 2013 sales of $1.15 billion
were 3.3 per cent lower than the $1.19 billion
generated in 2012.
Revenues from other countries increased
from $446 million in 2012 to $498 million last
year, representing growth of 11.6 per cent.
This grouping includes sales generated in
Guyana, Jamaica, USA and three other Eastern
EPS and share price
At a recent price of $66.45, AMCL s P/E
multiple is 15.4. Using its current year s div-
idend payment of $1.30, this price reflects a
yield of 1.94 per cent.
From early May to early June 2013, AMCL s
share price was quoted at $67.22. On March
11, 2014, before the 2013 results were released,
the share price was quoted at $66.50 and it
closed on April 23, 2014 at $66.45.
APRIL 27 • 2014 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
STOCKS | SBG15
Strong performance in 2013
ANSA McAL Ltd:
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