Valuation Report - JMMB Group Trinidad & Tobago · IN ANY FORM WHATSOEVER. JMMBITT is a member of...

Company Facts

Symbol: MASSY

Target Price: $61.14

Sector: Conglomerates

Market Cap.: $5,962,310,373.00

Issued Capital: 97,742,793

Financial Year End:

30 September

Valuation Report

January 2020 Charles Piralli Investment Analyst [email protected]

MASSY Holdings LTD (MASSY)

PLEASE SEE IMPORTANT DISCLOSURES & COPYRIGHT INFRINGEMENT IN THE APPENDIX

Overvalued Fairly valued Undervalued

TT$64.20 TT$58.08 The Massy Group, which has been in operation since 1923, is

a diversified regional conglomerate with operations

throughout the Caribbean basin, Colombia and South Florida.

The Group’s main segments are automotive and industrial

equipment, retail and distribution, energy, financial services

and ICT.

0

100,000

200,000

300,000

400,000

500,000

44

46

48

50

52

54

56

58

60

62

MASSY Price & Volume [2019]

Volume Traded ClosingQuote

3.97

1.36 0.92 0.68

4.98

0.080

2

4

6

Revenue by Country ($B)

Automotive & Industrial Equipment

Energy & Industrial

GasesITC

Other

Integrated Retail

Financial services

REVENUE BY SEGMENT

22%

10%

Peer Comparison

P/E P/B Revenue Growth

EPS Growth

Dividend Yield

MASSY 10.7 1.06 0.4% 8.3% 3.67%

AMCL 17.9 1.30 3.6% 2.3% 3.00%

GKC 15.6 1.50 4.3% 5.5% 1.71%

55%

2

All information contained herein is obtained by JMMB® Investment Research from sources believed by it to be accurate and reliable. All opinions and estimates constitute the Analyst’s judgment as of the date of the report. However, neither its accuracy and completeness NOR THE OPINIONS BASED THEREON ARE GUARANTEED. As such NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS OR COMPLETENESS OF THIS REPORT IS GIVEN OR MADE BY JMMB® IN ANY FORM WHATSOEVER. JMMBITT is a member of the JMMB Group and a registered broker dealer with TTSEC.

Valuation Report

Company Overview & History

In 1932, Neal Engineering, led by Harry Neal, and

Massy Limited, led by Charles Massy, merged to create

Neal & Massy Engineering Company Limited. By the

early 1950s, Neal & Massy was involved mainly in

importing machinery and engineering services. By this

time, the well-established tractor department offered

industrial equipment like cranes and compressors, while

the electrical and engineering departments supplied

service and smaller items. In 1958, the company went

public and expansion continued.

The Group started business in Guyana in 1968 when its

subsidiary, Associated Industries Limited, was

incorporated. In 1988, the Group’s four companies in

Guyana were Associated Industries, Demerara Oxygen,

Transportation Services and Demerara Property

Investments. NM Services Limited was created during

the re-structuring of the company in 2000. Today, Neal

& Massy Limited is the holding company for the Guyana

Group, which comprises 6 companies: the original

Associated Industries Limited, CCS Guyana Limited;

Demerara Oxygen Company Limited; Geddes Grant

Guyana Limited; NM Services Limited and Securicor

Limited.

The late 70s marked the beginnings of Neal & Massy’s

IT and Communications business unit with the formation

of Complete Computer Systems (CCS). Other Neal &

Massy companies in the Eastern Caribbean included the

equipment company in the French West Indies

Table of Content Cover page…………………..….……1

Company Overview & History……..2 Business Model…………..………..…4 Financial Analysis……………………8 Valuation Report……………………12

Discounted Cash Flow….....12 Simple P/E Insights……..…13 Dividend Discount Model....13

Risk Factors………………..…….…13 Limitations………………………..…14 Recommendation………..…………14 Appendix...……………..……………16

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Valuation Report

called Tirmarc; Plantrac (an equivalent of Tracmac), and Liquid Carbonic (Barbados). Copy

Services Limited in Antigua; Office Services in Grenada and seven companies in Guyana reported

through Neal & Massy Barbados. In the early 90s, Neal & Massy acquired the Geddes Grant Group

that owned a number of companies across the region, including Brinks Barbados – a security firm.

This firm was later converted into Securicor Barbados, currently the largest security firm in

Barbados, and Neal & Massy now owns 49% of the company. In 2008, Neal & Massy acquired

the Barbados Shipping & Trading Company Limited (BS&T) which has positioned the Group as

one of the largest Caribbean corporations in the region.

Neal & Massy Jamaica was formed in 1974 when the company acquired 25% interest in Xerox

(Jamaica). In 1979, Neal & Massy purchased a Bandag re-treading plant in Jamaica and the

company became a significant contributor to the Jamaica Holding. By the late 1980s, Neal &

Massy’s operations in Jamaica included Jamaica Oxygen and Acetylene; Jamaica Carbonics; Hi

Lo (Jamaica) and Trinjam Food Processors. In 1993, all Jamaican operations were consolidated

into a single corporate entity. In 2001, Neal & Massy also acquired H.D. Hopwood and Company

which is the largest distributor of pharmaceuticals in Jamaica and also offers a diverse range of

Fast Moving Consumer Goods (FMCG) to the retail and wholesale trade. Neal & Massy Group

Jamaica was eventually wound down and all the remaining business units were restructured

according to the Trinidad and Tobago Holding Company.

In February 2006, NM Industrial Gas Holdings Limited (NMGH) re-entered the Jamaican market

by jointly acquiring, with its partner Cool Corporation Limited, the LPG and retail businesses of

Shell Company West Indies Limited.

In July 2014, Neal and Massy Group changed its name to Massy as part of a comprehensive

rebranding exercise that unified all subsidiary companies to create a strong, consistent corporate

identity. The rebranding maximised marketing efficacy by powerfully connecting the equity of

strong subsidiary brands with the corporate brand and vice versa.

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Valuation Report

Business Model

MASSY Business Units in each Territory

[Source: MASSY Annual Report 2018]

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Valuation Report

MASSY earns its revenue from a number of business lines. Each business line is spread across

multiple countries and includes:

Integrated Retail [IR] which makes up 55%

of Revenue but only 40.1% of Operating Income

based on FYE 2018 statements. IR is comprised of

MASSY’s Retail Line, which is a traditional food

retailer which offers customers formats such as

supermarkets, super stores, pharmacies, home stores

and discounters. MASSY’s Distribution Line is also

captured under Integrated Retail. This business line

earns approximately 68% of its revenue from

Trinidad & Tobago and Barbados, two countries

which have been experiencing economic difficulty

in recent years with little sign of significant growth

in the near term. In response, MASSY has been

introducing more economical brands and additional

promotions in the core food basket and produce to adapt to the new consumer preferences.

MASSY has also been altering its product mix in stores, offering more non-food, Ready 2 Go and

bulk options which are generally higher margin products. The group has been investing in new

locations across numerous territories, with expansion in Guyana expected to be an especially

potent driver of growth. MASSY has also been leveraging its scale to implement shared services,

merging support functions within countries in order to reduce overheads.

Energy & Industrial Gases [E&IG] which

makes up 9.6% of Revenue but 20.2% of Operating

Income based on FYE 2018 statements. The E&IG

Business Unit comprises of energy services

companies, one oil production operation in

Trinidad and three wholly-owned industrial gas

operations in Jamaica, Trinidad and Guyana. A

50:50 joint venture with Air Products & Chemicals

Inc. in an Air Separation Unit in Pt. Lisas is

tethered to the Atlas Methanol plant providing high

purity Oxygen and Nitrogen to that facility. The

energy services companies consist of a joint

venture with Wood Plc. (Massy Wood Group Ltd.)

(MWGL) and two service companies in Trinidad

which provide a variety of mechanical, electrical,

instrumentation, insulation and fabric maintenance services, to upstream and downstream oil and

gas, and petrochemical companies in Trinidad. These services companies were consolidated in Q2

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Valuation Report

2019 as part of a restructuring exercise. Massy Energy Colombia S.A.S. which was acquired from

Wood Group PSN, Inc. in 2014 provides operations and maintenance, minor modifications and

other technical services to oil and gas, mining and pipeline companies in Colombia. The E&IG

Business Unit is the vehicle through which the Group’s 10 percent investment in a new 1,000,000

Tons/Year Methanol and Dimethyl Ether plant in La Brea Trinidad is being held. E&IG has been

one of MASSY’s premier growth drivers, with annualized revenue growth over the period FY

2014-2018 of 11% per annum. Going forward, the group intends to continue expansion efforts

throughout the Caribbean basin, with special emphasis on the Columbian and Guyanese markets

which are expected to exhibit strong growth in the coming years.

Automotive & Industrial Equipment [A&IE] which makes up 21.5% of Revenue and

20.1% of Operating Income based on FYE 2018

statements. This Business Unit is mainly

comprised of automotive dealerships in Trinidad

& Tobago and Columbia and a Caterpillar [CAT]

dealership. Several car rental sub-franchises are

the remaining components of the Business Unit.

The downturn in the Trinidad & Tobago

economy has had a detrimental impact to

MASSY’s business units which operate in the

country, with A&IE being no different. The

shortage of forex has necessitated that the local

businesses borrow USD from financial

institutions in order to cover supplier obligations in as timely a manner as possible. The Unit’s

strategy going forward includes additional investment and acquisitions in order to increase market

share in the Columbian market as well as seeking out suitable partners in new territories for rental

sub-franchises.

Financial Services which makes up 5.2% of Revenue but 12.9% of Operating Income based on

FYE 2018 statements. The flagship of the Financial Services Business Unit, Massy United

Insurance Ltd. (MUIL) is among the top five regional Property and Casualty insurance companies

in the Caribbean. The company operates in nineteen territories across the Caribbean through a

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Valuation Report

combination of branch operations and dedicated

agencies and has established a strong reputation

for customer service and responsiveness.

MASSY also operates a Money Services

business, where the primary business activity is

operating agencies for MoneyGram in Guyana

and Trinidad and Tobago and Western Union in

Barbados. On a combined basis, the group is the

largest MoneyGram Agent in the Caribbean

region. The remittance businesses are an

important source of foreign exchange for the

Group in each of the territories in which the

remittance businesses operate. In Trinidad, the

Consumer Finance business primarily provides

motor vehicle loans to customers seeking to

acquire motor vehicles, while in Barbados, the revolving credit business provides credit card

services. Over the past 5 years, the Financial Services Business Unit has been the fastest growing

Unit in the group at 24% per annum, though this rate has slowed in the past 2 years to 9% per

annum.

Information Technology &

Communication which makes up 4.9% of

Revenue but 10.1% of Operating Income

based on FYE 2018 statements. The IT&C

Business Unit provides mainly Information

and Communication Technology [ICT]

product and service solutions for a variety of

industries including the financial, energy,

education, healthcare, commercial, retail,

hospitality and government as well as image

and printing solutions. They operate in

countries such as Columbia and a range of

territories in the English speaking Caribbean,

including Trinidad & Tobago, Guyana,

Barbados, Jamaica and Antigua. The Unit

participates in segments such as e-

transactions, smart devices, Internet of Things (IoT), data analytics, and managed ICT services.

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Valuation Report

Other Investments which makes up 4.1% of

Revenue but 9.7% of Operating Income based on

FYE 2018 statements. The Other Investments Unit

consists of subsidiaries, joint ventures and

investments that are not part of the Group’s core

Business Unit activities. This unit consists of property

companies, which own and operate properties

occupied by Massy entities and third parties and

provide real estate sales and development services.

This unit also contains non-core subsidiaries such as

Roberts Manufacturing Co. Limited and Seawell Air

Services Limited. The unit also holds the Group’s

minority investments in G4S in Trinidad and

Barbados.

MASSY has indicated that in FY 2020 it intends to provide the executives and boards of its IR,

A&IE and E&IG Business Units greater autonomy in order to build capabilities to drive innovation

and effect strategies as they will be able to devote greater focus to their unit. Group Chairman

Robert Bermudez has stated that he expects the increased autonomy will produce greater value

and growth from MASSY’s main businesses. These business units represent the group’s 3 largest

segments by both Revenue and Operating Income.

Financial Analysis

Income Statement

In 2016, Revenue fell 4% owing to the decline in global energy markets and the subsequent effect

on the group’s E&IG Business Unit. Since then, MASSY has exhibited modest growth, albeit at a

slowing rate from FY 2017 to FY 2019. This in spite of declines in the group’s largest segment,

Integrated Retail, recording year on year declines of 1% and 2% before returning to modest growth

of 0.3% in FY 2019. The increases in Revenue are largely attributable to significant growth in the

group’s Automotive, Energy and Financial Services. Financial Services in particular has recorded

annualised growth of 8% over the 3-year period.

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Valuation Report

Operating Income has been volatile over the past 5 years, falling 18% to $740M in 2017 before

rebounding 18% to $874M in 2018. The decline in 2017 was a direct result of costs incurred due

to Hurricanes Matthew, Maria and Irma, as the insurance division was necessitated to buy

additional reinsurance following landfall of 2 of these hurricanes in the space of a week. Most

recently, Operating Income climbed 6% as improvements in the group’s ITC and Other Business

Units offset a reduction in the Financial Services Business Unit due to Hurricane Dorian. It should

be noted that the 22% improvement in ITC during FY 2019 was likely due to the sale of

subsidiaries, namely MASSY Technologies Applied Imaging [Trinidad] Limited in which the

group earned proceeds net of cash in excess of $20 MM. In addition, Chairman Bermudez

highlighted that if not for Hurricane Dorian, Financial Services was in track to record a year on

11,944.8

11,514.111,763.7

11,910.1 11,958.7

8,000.0

8,500.0

9,000.0

9,500.0

10,000.0

10,500.0

11,000.0

11,500.0

12,000.0

12,500.0

Revenue ($MM)

2015 2016 2017 2018 2019

0.0

100.0

200.0

300.0

400.0

500.0

FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Operating Income ($MM)

Automotive & Industrial Equipment Energy & Industrial Gases

ITC Other

Integrated Retail Financial service

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Valuation Report

year increase in Profit Before Tax of 30% for FY 2019.

Operating Margins have varied across the group’s business units. The group’s largest business

units, IR and A&IE have seen their margins diminish due to macroeconomic factors in Trinidad

& Tobago and Barbados. A bright spot has been the Financial Services business unit, which has

recorded year on year improvements in its operating margins, with the exceptions being FY 2017

and FY 2019 due to the impact of the hurricanes mentioned above. It should be noted that in more

recent years, the group has begun realising improved margins across all business units, as strategies

to realise operational efficiencies and divestment of lower margin subsidiaries appears to be

bearing fruit.

Non-Operating Income has been steadily improving year on year, climbing to $4.8M in 2018

following a loss of $24M in 2016. This has been a result of increasing Income from Affiliates,

which includes Massy Wood Group Ltd and Caribbean Industrial Gases Unlimited, which totalled

$29M, $69M and $79M from 2016 to 2018 respectively.

0%

5%

10%

15%

20%

25%

Automotive &Industrial

Equipment

Energy &Industrial

Gases

ITC Other IntegratedRetail

Financialservice

Operating Margin

FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

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Valuation Report

Net Income has exhibited similar volatility to Operating Income, with a significant drop of 25%

in 2017 to $376MM as a result of subpar performance by the group’s Financial Services and E&IG

Business Units, before rebounding 42% to $534MM in 2018 on the back of these same business

units. In FY 2018 and FY 2019, Net Income has been improving as the group’s more profitable

segments such as energy and financial services increased their share of total revenue and drove

improvement in Net Margin in addition to proceeds from sales of subsidiaries mentioned

previously.

Balance Sheet

MASSY maintains a good liquidity position, as evidenced by its improvements in Working Capital

year on year since 2016, as well as healthy Current and Quick Ratios, which stand at 1.85X and

1.32X respectively. The company also maintains a significant cash balance, which stood at

$2,073MM as at FYE 2019, a 27% increase over the corresponding figure from 12 months prior.

In addition, the group’s Debt to Debt plus Equity Ratio continues to decline and stands at 27.8%

as at FYE 2019, down from 30.1% as at FYE 2018.

Cash Flow Statement

Cash from Operating Activities has been fairly steady at approximately $1 billion through FY 2015

to FY 2017. In FY 2018 Cash from Operating Activities slipped to $736MM in 2018 as a result of

a reduction in Non-Cash Working Capital, mainly replenishment of inventories which had been

falling over the previous 2 financial years. In FY 2019 Cash from Operating Activities improved

to $806MM as a similar replenishment did not occur.

Cash from Investing Activities was -$534MM in FY 2018, in line with its historical trend

excluding a jump to -$1,055MM which was a result of the group’s increased spending on other

investments, non-controlling interest, associates and joint ventures during FY 2017 which was due

6.53

5.10

3.85

5.325.72

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Earnings Per Share ($)

2015 2016 2017 2018 2019

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Valuation Report

to the acquisition of Automontana Columbia. The acquisition served to double MASSY’s new car

sales in Columbia which now surpasses the corresponding figure for the Trinidad and Tobago unit.

In FY 2019, Cash from Investing Activities was $16.9MM as the group received proceeds from

the sale of subsidiaries, mainly MASSY Security Guyana Inc and MASSY Technology Applied

Imaging [Trinidad] Limited [+$102MM] in addition to increased dividends from associated

companies [+$80MM] and a reduction in financial assets [+$100MM].

In FY 2019, Cash from Financing Activities amounted to -$354MM, as the group only received

$8MM from borrowing as opposed to $176MM the previous year where Cash from Financing

Activities -$178MM, in line with FY 2016. During FY 2017, Cash from Financing Activities was

-$473MM as the company repaid approximately $269MM in debt.

Valuation Report

Five valuation models were utilized to obtain an estimated intrinsic value range for MASSY.

Firstly, a Discounted Free Cash Flow [DCF] model was utilized. Three relative valuation models

were applied, A Simple P/E Forward method which utilized the analyst’s estimate of FYE 2020

EPS, also with a Simple P/E trailing method and a Simple P/B method, all of which utilized the

average multiple over the last 5 years. Lastly, a Dividend Discount Model was utilized.

Discounted Cash Flow [DCF] Model

The discounted cash flow model is based on a detailed analysis and projection of company cash

flows and accompanying financial statements. The basis of this forecast are assumptions made

about the main value drivers for MASSY. We projected EPS to be TT$ 6.19 at the end of financial

year 2020. The key determinants of MASSY’s projected cash flows are key value drivers affecting

the firm’s 1) Revenue 2) Profit Margin 3) Working Capital Spending and 4) Fixed Capital

-2,000.0

-1,500.0

-1,000.0

-500.0

0.0

500.0

1,000.0

1,500.0

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Cash Flow ($MM)Operating Activities Investing Activities Financing Activities

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Valuation Report

Spending. Intrinsic valuation on the FCFE model shows a share price of TT$68.38 vs. a market

price of TT$61.80.

Simple Price/Earnings [PE] Insights

This model is a simple yet powerful measure of value that relies on historical market sentiment of

the growth prospects of the stock. The forward method uses the market implied multiple for

MASSY for the past 5 years and the analyst’s forecast of the firm’s EPS over the next 12 months

to arrive at the firm’s ‘fair value’. The analysis shows that MASSY is Overvalued by $1.64 or

2.6%.

The trailing method uses the same implied multiple and applies it to the firm’s EPS over its 4 most

recent quarters to arrive at the firm’s ‘fair value’. The analysis shows that MASSY is Overvalued

by $5.82 or 9.4%.

Simple Price/Book [PB] Insights

Simple P/B multiple, has a similar methodology to the simple P/E. It uses the average P/B multiple

for the past 5 years then determines a fair value by using the current book value per share (BVPS).

The analysis shows that the stock is Overvalued by $0.63 or 1%.

Dividend Discount Model [DDM]

Our DDM assumes MASSY will be able to maintain its 2019 payout ratio and grow its EPS (and

hence dividends) in line with the analyst’s estimates for the firm earnings for the next 5 years and

onwards. Intrinsic valuation on the DDM shows a share price of TT$ 32.02 vs. a market price of

TT$ 61.80.

Risk Factors

Slow economic growth/recovery in Barbados and Trinidad and Tobago, the territories to which

MASSY has the largest exposure could have significant impacts on the group’s revenue and

earnings growth. Reduced disposable income has a material adverse effect on the group’s

Integrated Retail business especially, as evidenced by the negative growth experienced by the

Business Unit over the previous 2 financial years.

Natural Disaster such as hurricanes and flooding are a significant risk for insurance companies

operating in the Property and Casualty insurance space. These risks are especially material for

MASSY as the Caribbean region in which it operates is especially susceptible to natural disasters,

relative to other regions around the globe.

Foreign Exchange shortages have had significant impacts on a number of the group’s Business

Unit, most notably the Automotive & Industrial Equipment Business Unit, as all inventory is

sourced via foreign suppliers that require payment in US Dollars. While there are companies within

the group which are net foreign exchange earners, these earnings are insufficient to finance the net

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Valuation Report

users within the group. As foreign exchange reserves in Trinidad and Tobago continue to be

eroded, the possibility of a currency devaluation is growing increasingly likely. MASSY’s IR and

A&IE business units in Trinidad will be seriously affected if this devaluation were to occur without

accompanying price adjustments, resulting in significant downward pressure on MASSY’s stock

price.

Supplier relationships is crucial to a number of business units within the group. A disruption to

these relationships, with specific emphasis on MASSY’s supplier to its A&IE Business Unit such

as CAT, Hyundia and Nissan would have a significant material impact on the associated business

lines.

Social unrest has been spreading throughout the Latin American region in 2019. In addition to the

persistent hardships in Venezuela, anti-government protests have been escalating in Ecuador, Chile

and most recently in Bolivia, which result in their president resigning and fleeing to Mexico. A

number of these countries share a border with Columbia, which is one of the territories which

MASSY hopes to invest further into in order to drive additional growth in the coming years. A

spill over of unrest from one of the neighbouring countries could severely impact Columbia’s

economic environment and by extension, MASSY’s local business’ performance. Another country

which MASSY views as a potent growth driver in the coming years, Guyana, is also located in

South America and shares a border with Venezuela.

Limitations

Analyst expertise - the analyst has not been following Massy group for an extended period of time.

The group is made of a large number of subsidiaries each with its own risk factors which contribute

to possible errors in the analyst’s assumption for projections.

Model Errors - DDM, FCFE, P/B and both P/E models were created in excel with the most room

for model error in the FCFE model.

Recommendation

Model Intrinsic/Fair Price

Overvalued (Undervalued) by

Weighting

Discounted Cash Flow (FCFE)

$ 68.38 (7.38) 50.0%

Multistage DDM $ 32.02 28.98 10.0%

Simple P/E Forward Valuation

$ 60.16 0.84 20.0%

Simple P/E Trailing Valuation

$ 55.98 5.02 10.0%

Simple P/B Trailing Valuation

$ 61.17 (0.17) 10.0%

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Valuation Report

Weighted average Intrinsic Value

$ 61.14

5% Above Average $ 64.20

5% Below Average $ 58.08

Our models give a range of values from $32.02 to $68.38, each with its own margin of error. The

models have been assigned various weightings as detailed in the table above. A 5% margin of error

was applied to the weighted price to give a fair value range of $58.08 - $64.20. This is compared

to the current market price of $61.80. We recommend MASSY with a MARKETPERFORM

rating.

This MARKETPERFORM rating is given on the following basis:

MASSY has been divesting a number of businesses in order to allow management to give

greater focus to more profitable business lines. This initiative has likely driven the erosion of

MASSY’s conglomerate discount over the past few years. A conglomerate discount refers to

the tendency for markets to value a diversified group of businesses less than the sum of its

parts.

MASSY’s Financial Services and Energy & Industrial Gases Business Units have been the

fastest growers of all the group’s business units. These units are also among MASSY’s highest

margin business lines, thus driving margin expansion for the group as this growth is expected

to persist in the region in the coming years.

Trinidad and Tobago and Barbados, two of the territories which MASSY has the largest

exposure to have possibly seen out the worst of their economic downturn and are expected to

return to modest growth in calendar 2020. Barbados in particular was recently upgraded 6

notches by Standard & Poor to B- with a stable outlook.

MASSY has been implementing various operational efficiency strategies such as the shared

services among lines of business in order to reduce costs. The improvement in margins across

the board [apart from the exceptional circumstances surrounding Financial Services] can

partially be credited to such initiatives. Going forward MASSY is likely to implement the

recommendations provided by Infosys related to process standardization and automation in the

new FY, further driving expense reduction and EPS growth.

Civil unrest in Venezuela has fuelled mass migration into neighbouring countries such as

Trinidad and Tobago, Columbia and Guyana, with increases in the vicinity of 5% speculated

by governments officials. The inorganic population growth in these countries is expected to

spur additional consumption in these economies, with MASSY’s Integrated Retail Business

Unit to specifically benefit from additional spending from migrants as well as loosening in the

labour market.

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Valuation Report

APPENDIX 1

IMPORTANT DISCLOSURES

Abstract— as a part of our new portfolio strategy we are recommending strict adherence to the

following portfolio allocation definitions/recommendations.

PLEASE NOTE THAT NO INDIVIDUAL ASSET IN YOUR PORTFOLIO SHOULD HAVE

A WEIGHTING GREATER THAN 10% UNLESS OTHERWISE RECOMMENDED BY YOUR

PORTFOLIO MANAGER/ INVESTMENT ADVISOR OR A SPECIFIC JMMB RESEARCH

REPORT. CONSEQUENTLY, THE FOLLOWING DEFINITIONS ARE PROVIDED FOR

CLARITY.

OUTPERFORM - up to 10% of your portfolio

MARKETPERFORM - 5% of your portfolio

UNDERPERFORM - 2.5% to 4.9% of your portfolio

STRONGLY UNDERPERFORM - less than 2.5% of your portfolio

SELL - 0% of your portfolio

COPYRIGHT INFRINGEMENT

“Unless otherwise expressly stated, copyright or similar rights in all material in this research report

(including graphical images) is owned, controlled or licensed by Jamaica Money Market Brokers

Limited or its affiliates (JMMB) and is protected or covered by copyright, trade mark, intellectual

property law and other proprietary rights. No part of this research report or the report in its entirety

may be published, used, reproduced, distributed, displayed or copied for public or private use in

any form including by any mechanical, photographic or electronic process (electronically, digitally

on the Internet or World Wide Web, or over any network, or local area network or otherwise)

without written permission from JMMB.

No part of this research report may be modified or changed or exploited or used in any way for

derivative works, or offered for sale, or used to construct any kind of database or mirrored at any

other location without the express written permission of JMMB.

Thank you for respecting our intellectual property rights.”

APPENDIX 2

Financial Summary

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Valuation Report

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Valuation Report

The investments referred to in this report may not be suitable for you should consult your licensed

investment advisor. Nothing in this report constitutes investment, legal, accounting or tax advice

or a representation that any investment or strategy is suitable to your individual circumstances or

otherwise constitutes a personal recommendation to you.

Valuation Report - JMMB Group Trinidad & Tobago · IN ANY FORM WHATSOEVER. JMMBITT is a member of...

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