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Massy Holdings delivers blowout quarter

Trinidadian firm to cross-list on Jamaica Stock Exchange

BY DAVID ROSE
Observer business writer

Wednesday, May 12, 2021

Despite challenges being experienced across all of its operating markets arising from the COVID-19 restrictions which lead to a three per cent fall in revenue to TT$2.86 billion, Massy Holdings Limited (MHL) posted a 47 per cent increase in profit attributable to shareholders of TT$120 million ($2.67 billion) for the period ending March 2021.

The regional conglomerate, which operates in integrated retail, motors and machines and gas products sectors, managed to eke out a 25 per cent increase in operating profit of TT$173.35 million as it navigated the reduced expenditure in its home market of Trinidad and Tobago and other parts of the Caribbean. Its motors and machines segment performed commendably as revenue grew by nine per cent due to the strength of its Columbian market space.

The report stated that, “Challenges with low volumes of bulk LPG sales in Jamaica arising from little activity at hotels and restaurants and low volumes of nitrogen sales in Trinidad arising from declining activity in the petrochemical sector of the economy constrained the Gas Products portfolio to a modest four per cent improvement in revenue in Q2 year to date in the 2021 financial year versus prior year.”

Its integrated retail portfolio was the main segment which reported a five per cent decline in revenue and was noted to have been impacted by lower consumer spending which was evident in the Q2 2020. As a result of expense control arising from independence through its various portfolios, Massy's consolidated net profit rose by 30 per cent to TT$125.88 million with earnings per share at TT$1.22 versus TT$0.84 in Q1 2020. Net profit attributable to shareholders for the nine months remains up by 25 per cent at TT$293.48 million.

Total assets for Massy declined by three per cent to TT $12.67 billion ($28.17 billion) largely due to a five per cent fall in other assets which ended the period at TT $5.05 billion. Total liabilities dropped by 12 per cent to TT$6.18 billion while equity attributable to shareholders increased by nine per cent to TT$6.49 billion. Massy declared a dividend of TT$0.55 which totals TT$54.9 million ($1.2 billion) and represents a 10 per cent increase over the prior year. Massy's sale of its 50.5 per cent stake in Robert's Manufacturing to Proven Investments Limited for US $21.5 million should be completed within the quarter.

As seen with Guardian Holdings Limited (GHL) last week, Massy has signalled its intention to list on the Jamaica Stock Exchange (JSE) by cross listing its shares. GHL's debut to the JSE saw it becoming the second largest company by market capitalisation at $208.82 billion. Massy derives seven per cent of its profit before tax in Jamaica.

“Consistent with the company's ongoing support for regional integration, the board of directors made the decision to apply to cross-list shares on the Jamaica Stock Exchange. The board considered the market sophistication and growth opportunities evident in the Jamaican securities market, which has become increasingly more dynamic over the past few years.”

The board stated that it anticipates greater regional and international interest in the Company's shares in a notice to shareholders as required by the Trinidad and Tobago Securities Act.

Massy's listing at its current price of TT$65 ($1,445.05) would make it the most expensive ordinary stock on the JSE by nominal price. This would result in Massy becoming the fourth largest company on the JSE by market capitalisation ahead of Scotia Group Jamaica but just below Sagicor Group Jamaica. Massy recently appointed Bruce Melizan as a director effective as of June 1 following the retirement of William Lucie – Smith. Massy's stock hasn't traded since the announcement of the intention to cross list. It's best bid currently stands at TT$68 and best ask at TT$74.75.

Although Massy hasn't stated who will lead its introduction to the JSE, it should be noted that Patrick Hylton sits on the board of Massy as an independent director following his appointment in February 2012. Hylton is the chairman of GHL and president and CEO of NCB Financial Group Limited. GHL listed on the JSE through NCB Capital Markets Limited which confirmed that its license to operate a brokerage operation in Trinidad and Tobago should be complete before the end of the financial year.

“With increased autonomy provided to the portfolios, the group is unleashing the creativity and ambition of executives and professionals in the group to drive the performance of their portfolios. We are confident in our portfolio teams to overcome this interruption to their growth trajectory in the coming months,” said chairman of Massy Robert Bermudez on the outlook for the business.