Trinidad: Massy makes $167m in profit in first quarter

By Trinidad Guardian

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(TRINIDAD GUARDIAN) – Massy Hold­ings Ltd has reg­is­tered a $167 mil­lion in prof­it af­ter tax for the first quar­ter (Q1) of the 2020 fi­nan­cial year.

In the com­pa­ny’s fi­nan­cial state­ment, Massy chair­man Robert Bermudez said, “Low­er ef­fec­tive tax rate (aris­ing from Bar­ba­dos tax re­forms in 2019) pro­duced an even high­er in­crease in prof­it af­ter tax (PAT) of 13 per cent to $167 mil­lion.”

The com­pa­ny al­so post­ed third- par­ty rev­enue of $3.27 bil­lion, two per cent above the pri­or year’s Q1 third-par­ty rev­enue.

The group’s prof­it be­fore tax (PBT) of $250 mil­lion was al­so eight per cent high­er than PBT in Q1 pri­or year. The or­gan­i­sa­tion’s earn­ings per share (EPS) saw an in­crease from $1.37 per share in the pri­or year to $1.57 per share in Q1 of FY 2020, which rep­re­sents a 15 per cent in­crease.

Bermudez said, “The group has start­ed to see the ben­e­fits of the new port­fo­lio struc­ture an­nounced in its 2019 an­nu­al re­port and an­nu­al gen­er­al meet­ing. The sig­nif­i­cant growth in most of the group’s port­fo­lios and lines of busi­ness (LoBs) is not a co­in­ci­dence.”

In the com­pa­ny’s 2019 An­nu­al Re­port, CEO Ger­vase Warn­er ex­plained: “Chair­men and LoB chair­men will fo­cus on pri­or­i­ties for their busi­ness­es and will no longer par­tic­i­pate in an ex­ec­u­tive com­mit­tee re­view­ing op­er­a­tions and mak­ing group-wide de­ci­sions for all units.

“Chair­men and their ex­ec­u­tives in port­fo­lios will fo­cus at­ten­tion on the strat­e­gy, risks and op­er­a­tions of their re­spec­tive port­fo­lios to dri­ve stronger en­gage­ment with em­ploy­ees and cus­tomers to pro­duce ex­cep­tion­al fi­nan­cial re­sults.”

The struc­tur­al changes, ac­cord­ing to Warn­er, will “help our busi­ness­es sur­vive and thrive by be­ing bet­ter able to change be­fore a cri­sis forces us to.”

Warn­er added the changes will al­so re­sult in im­proved cash flow for share­hold­ers and more trans­par­ent re­port­ing on the in­dus­try port­fo­lios which will pro­vide a clos­er in­sight for in­vestors on the per­for­mance of the busi­ness­es.

“We be­lieve that more trans­par­ent re­port­ing be­yond what is re­quired by ac­count­ing stan­dards will al­low our share­hold­ers to make bet­ter de­ci­sions on their in­vest­ment in the Massy share,” said Warn­er.

Bermudez added, “The port­fo­lio struc­ture of the group is pro­vid­ing more au­ton­o­my and par­tic­i­pa­tion for ex­ec­u­tives and pro­fes­sion­als in the port­fo­lios to dri­ve the suc­cess of their busi­ness­es as they un­leash their cre­ativ­i­ty and am­bi­tion.

“Ex­ec­u­tives are op­er­at­ing with greater fo­cus and have in­ten­si­fied the time spent with their lead­er­ship teams and staff, fo­cus­ing on strat­e­gy, op­er­a­tions and peo­ple.”

In Q1 of 2020, the com­pa­ny’s PBT growth from the in­te­grat­ed re­tail, mo­tors and ma­chines and gas prod­ucts port­fo­lios were 10 per cent, 15 per cent and 27 per cent re­spec­tive­ly.

How­ev­er, Bermudez not­ed that the adop­tion of IFRS 15 (rev­enue recog­ni­tion) and IFRS 16 (leas­es) had a neg­a­tive im­pact on rev­enue and ex­pens­es for the re­tail busi­ness and re­duced the PBT im­prove­ment for in­te­grat­ed re­tail to four per cent.

He said that the fi­nan­cial ser­vices and the ITC LoBs al­so re­port­ed ex­cel­lent PBT growth of 38 per cent and 37 per cent re­spec­tive­ly. Massy’s port­fo­lios and op­er­at­ing LoBs added $37.6 mil­lion of PBT above Q1 2019.

How­ev­er, the busi­ness lines for strate­gic and oth­er in­vest­ments saw a de­cline of $26.1 mil­lion ow­ing to loss of in­come from di­vest­ed in­ter­ests in se­cu­ri­ty com­pa­nies and a re­duc­tion in prof­it from Massy Wood (as client ac­tiv­i­ty de­clined ver­sus the same pe­ri­od in FY 2019).

Mo­tors and ma­chines and in­te­grat­ed re­tail port­fo­lios gen­er­at­ed strong im­prove­ments of 10 per cent and five per cent re­spec­tive­ly.

The rev­enue growth from dis­tri­b­u­tion com­pa­nies of 10 per cent out­per­formed the two per cent rev­enue im­prove­ment from the re­tail com­pa­nies.

Bermudez not­ed that Massy Stores Trinidad was with­out two stores in Q1 2020, which were op­er­at­ing in Q1 2019, and this re­sult­ed in a loss of ap­prox­i­mate­ly five per cent of its rev­enue in Q1 2020.

“All Massy Stores Rev­enue lines were neg­a­tive­ly af­fect­ed IFRS 15, which re­quires loy­al­ty points to be de­duct­ed from rev­enue (loy­al­ty points were pre­vi­ous­ly booked to cost of sales).”

This article was posted in its entirety as received by This media house does not correct any spelling or grammatical error within press releases and commentaries. The views expressed therein are not necessarily those of, its sponsors or advertisers.

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