RBTT posts overseas earnings, Grace Kennedy sees increased revenue

RBTT Financial
Holdings Limited

Results for the
Six months ended
September 30, 2003

RBTT Financial Holdings maintained the momentum shown in the first quarter with its performance for the six months ended September 30, 2003.  Profit attributable to shareholders at the half-year totalled 323.3 million, a 40.2 percent improvement over the corresponding amount of $230.6 million achieved in 2002. Net interest income rose 22.9 percent to $715.5 million in 2003 from the $581.9 million recorded in the similar period in 2002.  Other income improved by an even better 47.7 percent in 2003 to $465.2 million, up from the $314.8 million made in 2002. Total net income was up for the half-year by 31.7 percent, standing at $1,180.7 million when compared with $896.8 million made during the same period in 2002.  Non interest expenses increased to $813.8 million in the 2003 period, up 30.1 percent from $625.5 million incurred in 2002.  Operating profit grew by 35.2 percent at the half-year, reaching $366.8 million, while in the corresponding 2002 period, this amount was $271.3 million.  Share of profits of associated companies jumped 126.1 percent to $22.1 million in 2003 from the 2002 six month figure of $9.8 million. 

Profit before taxes was 38.4 percent higher in the six months ended September 30, 2003 at $388.9 million from the similar period in 2002 when this total was $281.1 million.  There was a strong indicator of increased earnings from overseas subsidiaries via a lower effective tax rate at 15.9 percent at the half-year, compared to the 16.7 percent in 2002.  Earnings per share for the six months ended September 30, 2003 was 95 cents, an increase of 39.7 percent over the similar period in 2002 when this amount was 68 cents. The Chairman stated that the Jamaican and Dutch Caribbean operations continued to contribute positively to the Group overall performance.  Revenue from Trinidad and Tobago companies increased 11.5 percent to $775.2 million in the 2003 period from $695.3 million made in the similar period in 2002.  The Other Caribbean Territories doubled the local percentage increase, improving 22.8 percent to $912.3 million in 2003 over the corresponding period in 2002 when the amount was $743.1 million.  The local operations’ contribution to operating profit declined 9.9 percent to $139.8 million in 2003 from the previous half-year figure of $155.2 million. Other Caribbean Territories operating profit increased 95.5 percent to $227.1 million from $116.2 million.  Overall, 62.0 percent of operating profit was earned outside Trinidad and Tobago. An interim dividend of 39 cents will be paid on November 25, 2003 to registered shareholders as at November 12, 2003.  This represents a 39.3 percent increase over the 28 cents paid in respect of the similar period in 2002.  In a subsequent event, RBTT Financial Holdings now owns a 15.7 percent shareholding of Guardian Holdings Limited (GHL).  This is the result of a decision taken to upstream the Group’s investment from the insurance to the Group level.  The Chairman expects the Group’s “strong earnings momentum” to be maintained in the next half.  Therefore based on this sentiment, we are revising our full-year EPS projection upward to $2.30 per share.  At the current price of $32.06, the PE of 13.9 is still attractive, and we recommend this share for all investors. 

Grace Kennedy and Company Limited

Results for the nine months ended September 30, 2003. All results in J’can$.

Revenue for Grace Kennedy and Company (GKC) increased 22.2 percent in the nine months ended September 30, 2003 when compared with the similar period in 2002.  In the 2003 period, revenue totalled J$16.499 billion, while the corresponding 2002 figure was J$13.505 billion.  Operating income rose 47.5 percent in the 2003 period to J$1,111.0 million from the J$753.0 million achieved in 2002. Profit attributable to shareholders was 19.1 percent higher in the 2003 period at J$1,066.6 million from the similar period’s 2002 figure of J$895.6 million. All Divisions recorded satisfactory performances, with Financial Services and Information Services doing the best.  There was some consolidation within the Retail and Trading Division as Rapid and Sheffield, Agro-Grace and Hardware and Lumber have merged.  The new entity is now the largest wholesaler and retailer of hardware, home improvement, and agricultural products in Jamaica. Earnings per share reached J$3.30 in the nine months ended September 30, 2003.  This compares to J$2.77 made in the corresponding period in 2002.  We are maintaining our forecast of TT50 EPS for fiscal 2003, bearing in mind the depreciation of the Jamaican dollar against the US dollar for 2003.    

Capital & Credit Merchant
Bank Limited (CCMB)

Results for the nine months ended September 30, 2003.
All figures quoted in Jamaican Dollars

Gross operating income increased by 63.29 percent to $3.143 billion in 2003 from $1.925 billion in 2002 for the nine months ended September 30, 2003.  Net interest income increased by 4.77 percent to $378.485 million in 2003 from $361.259 million in 2002. Other operating income increased by 144.42 percent to $335.486 million in 2003 from 137.259 million in 2002.  This huge increase was due to an increase in foreign exchange gains of 1077.99 percent from $13.385 million in 2002 to $157.674 million in 2003. Net profit after tax moved up by 45.42 percent from $204.626 million in 2002 to $297.569 million in 2003.  Earnings per share increased by 33.13 percent to $0.54 in 2003 from $0.41 in 2003.