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Cover Story : The Battle for Control of Salada Foods

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16 years ago

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A deal that left more questions than answers

What did Donovan Lewis, Chairman of Three Bears see in Salada Foods that nobody else saw? How about a pre-tax profit of JA$482,906,847.38

The latter part of 2008 saw Christopher Berry, Chairman of Mayberry Investments and Donovan Lewis, Chairman of Three Bears in a one sided battle for control of Salada Foods. What did they see and know that other players in the market didn’t?

On the 15th July 2008, the announcement on the Jamaica Stock Exchange (JSE) website was that “Salada Proposed A Stock Split”. Salada Foods Jamaica Ltd advised that at a meeting of the company’s Board of Directors to be held on July 22, 2008, the directors would be considering a split of the company’s share.

On the 25th of July in 2008, the following was posted on the JSE website “Stock Split-Salada Foods.”

“The Board of Directors of Salada Foods Limited has advised that the Directors have decided on the following matters at its meeting held on July 22, 2008:
a. To increase the number of authorized shares in the company from ten million four hundred thousand to five hundred million ordinary shares of no par value by the creation of four hundred and eighty nine million six hundred thousand new shares of no par value.
b. From the new shares created the company will issue nine new ordinary shares for every one ordinary share currently held by each member of the company.
c. To call an Extraordinary General meeting of the shareholders’ to be held on August 28, 2008, at 3 p.m., at the Hilton Kingston Hotel to put forward the above stated Ordinary resolutions and
d. To put forward at the meeting Special resolution for the adoption of Articles of Incorporation of the company and cancel the existing Articles and Memorandum in substitution therefore. “
There was no indication from this report what the intention of this move might be; was it to increase the company’s share capital to fund projected growth and expansion, or was it designed to raise funds to pay down expensive debt?.

At the time, the company’s stock was trading between JA$130 and JA$135 per unit having started the year at JA$44 and would go as high as JA$150 before the end of the year on very low trading volumes (see table below). It could therefore be assumed that the stock split was designed to allow the shares to trade in smaller denominations thus attracting more investors. But was this the real value of the stock? Or was this the result of rampant speculation driving the price up?

SALADA MONTHLY
TRADING VOLUMES 2008
Jan 1,899,214
Feb 90,822
Mar 67,615
Apr 14,014
May 29,386
Jun 850
Jul 3,620
Aug 1,149
Sept 1,235
Oct 1,175
Nov 30,150
Dec 94,500

Did the volume of stock trades warrant this kind of move in the stock price? One could hardly take these low levels of trades as a serious bid to wrestle and secure control. Still, more unanswered questions.

What did Salada have to offer?

For the financial period ending September 30th 2008, Salada posted revenues of $393.8M an increase of $51.1M or 14.9% over 2007. Profit before tax was $114.0M compared to $102.6 for the corresponding period in 2007. Net profit attributable to shareholders was $75.3M compared to $68.2M. Earnings per share (EPS) was $7.25 compared to $6.56.

“I can’t think of anything special or specific at the time that would warrant a stock price war and battle for control of Salada foods, other than a good brand name and reasonable good export growth prospects I don’t see much else”, according to one financial analyst when asked the question. That also seemed to be the perspective of a number of other industry watchers. So what really was it? What did Chris Berry and Donovan Lewis, the two players battling for control, see and know that other players in the market didn’t know and could not see? Was this much ado about nothing or was there really something there? Could it be that there was collusion to drive the stock price up?

One senior business executive suggested that Mayberry’s attempt to secure control by offering $32.50 per share for 51 per cent of the coffee company’s near 10.4 million issued shares was not realistic, as Donovan Lewis controlled just over 60 per cent of Salada, and was not likely to sell to Mayberry to give them the desired control.

So, when Mayberry announced a hostile bid for Salada Foods, at $32.50 per share for 51 per cent of the coffee company’s near 10.4 million issued ordinary shares, investors started to take notice. The offer opened on August 30th and closed September 28th last year. At the time, there were 10,388,320 Salada shares outstanding, which would put Mayberry’s cash offer at approximately J$172.2 million.

The Mayberry bid rivalled that of the August 17th 2008 Donovan Lewis-controlled Three Bears’ offer of $25.82 per share for the remaining 39.77 percent of ordinary stock units in Salada. Mayberry said its cash offer had long-term benefits for the company, including profitability growth potential.

There was, as would be expected, varying views by analysts on the offers. According to one published view, “The move to acquire a 51 per cent shareholding in Salada might be an attempt by Mayberry to prevent Three Bears from increasing its shareholding in Salada by as much as 80 per cent and subsequently delisting the company”. However published statements attributed to Donovan Lewis confirmed that he had no intentions of delisting the company, and was only responding to take-over rules triggered by his current holdings. Others felt it could diversify Mayberry’s business and boost Salada’s share price.

Three Bears, which is based in the British Virgin Islands, surpassed the 50 per cent threshold to trigger a mandatory take-over bid when Lewis or companies controlled by him acquired Three Bears from the Caribbean Investment Fund (CIF) at the end of 2006.

The deal gave Three Bears 2,052,000 ordinary stock units in Salada. Lewis, through Three Bears, subsequently purchased a further 2,018,981, ordinary Salada stock units from the CIF. The combined acquisitions gave Three Bears 60.23 per cent ownership of Salada.

Chief Executive Officer of Mayberry, Gary Peart, in published media reports last year was quoted as saying that “his (Mayberry) firm was prepared to offer more than Three Bears as it believes the acquisition of shares in Salada has sound, long-term benefits.”

“We are prepared to offer close to 26 per cent ($6.68) above the Three Bears’ take-over offer because we believe that the acquisition of shares in Salada has sound, long-term benefit. Salada presents the profile and profitability growth potential that we look for in companies to include in our acquisition strategy going forward, though it’s continuing profitability is not a certainty,” Peart also said.

It’s interesting to note that both bids were significantly below Salada’s then market price of $45.

This begged answers to the following questions.

What triggered the stock movement to 45 dollars per share?

Why were the offer prices for the stock below 45, hovering now between JA$26 and JA$32.5 dollars?

What’s the real value of a Salada stock?

And so a bidding war was on for controlling interest in Salada Foods, and as one analyst said, “it could be that Mayberry is banking on the fact that any price below 45 is a good buy and with an expectation that the price may move back up they will be guaranteed a handsome profit on the deal. And with a bidding war now in play with Three Bears, chances are that the prices will begin to move again. So it appears no matter what Mayberry and Three Bears do by virtue of their actions, each may just get the price movement they seek.”


So was the Salada takeover battle an exercise in futility?

“I have over 60 per cent of the shares and I’m not selling. Is he (Chris Berry) really serious?” commented Donovan Lewis, Chairman Three Bears Limited.

The buzz around Salada pushed the stock price to JA$70 per share and in the face of a clear and unequivocal rejection of an offer to buy controlling interest from Donovan Lewis, Chris Berry’s Mayberry Investments was still pushing. The only question to be answered was why?

Given that Donavan Lewis acquired the stock at $25.82 or $161.5m in total value, this represented a whopping $277m gain in less than ten months. Chris Berry did not do too badly either. Mayberry Investments’ 0.3 per cent share holdings made roughly $1.4 million based on the stock price. Investment managers were reported to be saying at the time that the stock price might even climb further to $80.

The Salada Board subsequently announced that Mayberry had served a written notice upon the Company increasing its take-over bid price from J$32.50 per stock unit to J$40.08 per stock unit. The new price valued the Mayberry bid at $212 million. In response, the coffee company called an urgent meeting of its Board of Directors on September 19, 2008 to consider the Mayberry increased offer.

Mayberry’s move was ahead of the Board’s recommendation that shareholders reject the original bid in August of $172 million, or $32.50 per share, to gain fifty-one per cent (51%) of Salada, rivalling the mandatory bid of $25.82 made by controlling shareholder, Donovan Lewis’ Three Bears. The Salada Board said it had undervalued the holdings. At $70 per share, Salada was valued at $727.2 million ($70 times 10,388,330 stock units in issue). At that price, Mayberry’s holding, a negligible 31,250 units or 0.3 per cent of the Company was worth $2.2m; while Three Bears, which owns 60.23 per cent of Salada or 6,256,891 units, was worth $438m.

Not selling

To secure its targeted 51 per cent bid, Mayberry would have to woo Three Bears to sell some of its holdings. Lewis however is reported to have again said that he would not sell neither would he improve his offer, calling the Mayberry offer a futile exercise. “I don’t know what they are trying to do; that doesn’t make sense,” he said. “I have over 60 per cent of the shares and I’m not selling. Is he really serious?”

Mayberry however remained undaunted indicating that it saw value in the stock and that responses to the offer had been fair so far, indicating that the price offer was a result of Mayberry’s re-evaluation of the stock.

Lewis said that even at the new price, Mayberry’s rival offer could not succeed. He said that, “no one at the company had approached him to sell and that the new $40.08 offer was neither worth the time nor the effort.”

However, Peart said Salada is an illiquid stock and that the price could jump significantly either way. He argued that a lot of shareholders had already taken up the offer saying they had been trying to sell their shares for years but could not find buyers.

As 2008 came to a close, Salada stock price reached as high as JA$150 per unit, driven largely by speculations. The Directors of Salada Foods subsequently advised that they would do a stock split and shareholders were to receive a ten to one offer, consistent with the resolutions put forward at the Extraordinary General Meeting.
With the stock price at JA$150 per share, the value of Donovan Lewis’ share holding in the company moved from JA$161,552,925 to JA$644,459,773, a gain of JA$482,906,847. Mayberry’s investments now had a pre-tax profit of JA$2,411,875.
Was this the end game? Your guess is as good as mine.

Additional Sources: Jamaica Gleaner, Jamaica Observer, Jamaica Stock Exchange, Internet sources

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Jamaica Stock Exchange Group Recorded Strong Performance For The Third Quarter

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November 16, 2024

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Third Quarter Performance

• Net Profit after Tax of $194.9m was 255% greater than the prior year comparable quarter.
• Earnings per share of $0.28 cents reflected an increase of 250% compared to the corresponding quarter in 2023.
• The Return on Equity was 7.1% as against 2.3% in 2023 representing an improvement of 208.7%.

Income
Total Income for the JSEG of $746.4m, represents a $232m (45.1%) increase over the corresponding quarter of 2023. The increase in Income is attributed to Cess which increased by $138.6m (249.7%) when compared to prior year. Fee Income and eCampus increased over prior year by $94.7m (22%) and $3.4m (51.5%) respectively.

Expenses
Total Expenses of $495.9m increased by $76m (18.1%) when compared to the corresponding quarter in 2023. The main expenditure contributing to the increase are as follows:
• Staff Cost was above 2023 comparatives by $14.6m (7.2%). This was due to an 8% cost of living increase and new staff hires to facilitate anticipated growth and enhanced customer service delivery.
• Advertising and Promotion was above 2023 comparatives by $8.3m (50.3%). This is mainly due to additional activities aimed at stimulating growth within the markets.
• Net impairment loss on financial asset was above prior year by $10.7m (110.4%) due to the requirements of the expected credit loss model.

Net Profit
Net Profit after Tax of $194.9m represents an increase of $140m (255%) when compared to the profit of $54.9m for the corresponding period in 2023.

Financial Position
Total JSEG Assets as at September 30, 2024, of $3,365.3m, reflects an increase of $411.8m (13.9%), when compared to holdings as at September 30, 2023, due primarily to increase in Trade and Other Receivables and Government Securities Purchased Under Resale Agreement.

Total Equity of $2,739.8m as at September 30, 2024, reflects an increase of $331.3m (13.8%) and $120.8m (4.6%) over the comparable positions at the end of September 30, 2023, and December 31, 2023, respectively.

Revenue Reserves reflect an increase of $125.3m (7.4%) over the position as at December 31,2023, which is net of $239.1m paid to shareholders as dividend and the nine months’ profit.

Market Developments & Outlook
The Third Quarter performance has been particularly good. We anticipate that as interest rates trend down and other market turbulences subside, investors and companies will be more active in the market, which will result in improved performance. We have made significant stride in our diversification strategies, and this has and will continue to support us as we cope with geo-political unrest and other uncertainties in the economy that have impacted the market.

The JSEG will continue our effort at ensuring that our governance framework is strong and our risk mitigating measures which assists in driving sustainability are robust. We remain resolute in our commitment to maximize shareholders’ wealth, through the improvement in income and the management of our expenditure while providing strong support to stakeholders and the country at large.

Marlene J Street Forrest Managing Director Jamaica Stock Exchange Group
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Barita Reporting Treasury, Trading And Brokerage And Investment Banking Business Lines As Largest Contributors FY24 Performance

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November 16, 2024

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Net profit after tax (“NPAT”) for Q4 FY24 increased by 200% to $999 million, bringing NPAT for FY 2024 to $3.9 billion, 14% ahead of 2023. The improvements achieved in Q4 FY24 reflected the effects of management’s strategy to influence improvements in operating revenue through a focus on active balance sheet management, revenue diversification and expense management, in particular the management of funding costs.

Revenue growth in Q4 FY24 was both robust and well-distributed, led by an exceptional performance in our Treasury, Trading and Brokerage business line, which accounted for 56% of total revenue. This improvement was supported by the continuation of the uptrend in net interest income which rose 3% to $164 million relative to the comparable quarter in financial year 2023.

Directionally, this performance aligned with expectations, buttressed by a pivotal shift in the monetary policy stance of the Bank of Jamaica and the US Federal Reserve, both of which reduced their benchmark policy rates by 25 and 50 basis points respectively, during the fourth quarter. While an additional 25 basis point cut was announced at the end of September, to come into effect at the beginning of October, the BOJ had communicated a shift in its policy posture during Q3 FY24, to which the market began to react via the downward repricing of liabilities, by extension, benefitting our Net interest income. The balance of risks points towards continued improvement in our net interest income as our interest-bearing liabilities reprice with a more frequent cadence.

The macroeconomic landscape has also evolved favourably. Domestic inflation has moderated, now averaging within the BoJ’s target range for the last 6 months, and a similar moderation has taken hold in the U.S.A., even as the Federal Reserve continues to signal a cautious, data-driven approach to future rate cuts. While these developments suggest a more stable financial environment prospectively, potential global risks remain. Slowing growth in key global markets, coupled with geopolitical uncertainties and the impending change in administration following the recent election in the US could introduce volatility; however, Barita’s diversified revenue streams and resilient business model position us well to navigate these headwinds.

Operating Performance
Barita generated net operating revenues of $10.0 billion for FY24, representing an increase of 10% or $901 million relative to FY23. The increase was broadly distributed across our various business lines, with income from the treasury, trading and brokerage and investment banking business lines being the largest contributor.

Net profit was $3.9 billion for FY24, rising 14% relative to FY23. The resulting earnings per share (“EPS”) was $3.24, up 14%.

Quarterly Performance
For the quarter ended September 30, 2024, Barita registered revenue of $3.0 billion, $1.2 billion or 72% higher than Q4 FY23, driven by a material uplift in the Treasury, Trading and Brokerage business line during the quarter. In the quarter, Barita produced NPAT of $999 million, $667 million (200%) higher than the prior year. This resulted from the aforementioned higher operating revenue, partially offset by a 26% or $346 million increase in operating expenses. Profit before taxation amounted to $1.3 billion, which was an improvement of $888 million or 207% relative to the prior year.

Shareholders’ equity closed the period at $35.5 billion, an increase of $71 million, marginally higher than the $35.4 billion outturn at the end of FY23. This was driven by an improvement of $734 million in the fair value reserve, offsetting the decline in retained earnings due to dividends declared and paid during the year. Our capital levels remain resilient, with capital adequacy of 25.45% compared to the FSC’s early warning level of 14%.

Investment Strategy & Capital Management: Our Outlook
The outlook for monetary policy continues to evolve over the course of the fourth quarter of FY24, transitioning from the tightening cycle that has dominated the past two years. Both the Bank of Jamaica (BoJ) and the Federal Reserve, along with other major Central Banks, have reduced their policy rates amidst a sustained moderation in inflation. This shift is expected to lay the groundwork for a more favourable investment environment in the coming quarters.

In the United States, recent economic indicators suggest that the cooling effect of tight monetary conditions has begun to take hold. Core PCE inflation has moderated to 2.7% from a pandemic peak of 5.7% in February 2022. Unemployment remained low at 4.1% in September but has attracted more focus from policymakers at the Federal Reserve given the upward trend since the beginning of 2024. The U.S. economy delivered solid GDP growth of 3.0% in the second quarter of 2024, exceeding expectations, but leading indicators continue to suggest potential weakness ahead. Against this backdrop, the Fed opted for a 50-basis point rate cut in September 2024, bringing the federal funds target range to 4.75%-5.00%. Markets have since priced in the expectation of further rate cuts as inflation trends towards the Fed’s 2% target.

Locally, Jamaica has seen similar progress. Annual headline inflation in Jamaica stood at 5.7% as of September 2024, back within the BoJ’s target range following the uptick in August to 6.5% due to the impact of Hurricane Beryl. Moreover, the BoJ’s recent cumulative reduction of its policy rate by 50 basis points to 6.50% during the quarter, reflects growing confidence that average inflation will remain within the target range in the near term, supported by stable domestic demand, a relatively stable exchange rate, and the continued moderation of global commodity prices. Jamaica’s economy remains resilient, albeit with moderating growth in key goods-producing and service sectors.

Looking ahead, we anticipate a further shift toward more expansionary monetary conditions, both locally and globally, which will likely enhance our ability to optimize our balance sheet and improve the net interest margin. As funding costs stabilize and earning assets continue to reprice upward, we expect to see a positive impact on our financial performance. Additionally, more favourable market conditions should provide increased opportunities for trading gains, and we foresee a gradual acceleration in deal-making activity, further boosting revenue growth.

However, we remain cognizant of the risks that persist in the global macroeconomic environment. Slowing growth in key global markets, coupled with geopolitical uncertainties and the impending election in the world’s largest economy, may introduce volatility that could impact our investment activities. Despite these headwinds, we continue to prioritize the diversification of our revenue streams, particularly through our alternative investment platform, which includes our real estate ventures that are poised to deliver significant returns in the medium to long term.

In this context, prudent capital management remains central to our strategy. We will continue to ensure strict compliance with regulatory requirements while maintaining the flexibility to capitalize on emerging opportunities. Through these efforts, we are confident in our ability to navigate the evolving economic landscape and deliver sustained value to our shareholders.

Mark Myers, Chairman Barita Investments Limited (“Barita” or “the Group”)

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iCreate Transitioning From A Digital And Creative Training Company To A Diversified Investment Holding Company Kintyre Holdings.

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November 16, 2024

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This quarter, Visual Vibe’s strong performance has been instrumental, reinforcing its pivotal role within Kintyre Holdings’ portfolio. Additionally, we are now unlocking value from our strategic investments in key properties, which are contributing positively to our income and strengthening our position as a dynamic investment holding company committed to delivering sustained value to our shareholders.

Change of Name & Purpose of the Business
At our Annual General Meeting (AGM) held in October 2024, the company officially rebranded from iCreate Limited to Kintyre Holdings (JA) Limited. This name change reflects our shift in purpose to an investment holding company, better aligning with our broader business strategy.

We are transitioning from a digital and creative training company to a diversified investment holding company.

This rebranding reflects our expanded focus across various sectors and strategic ventures, marking a significant shift in our corporate trajectory. Additionally, our purpose has been updated to reflect this new direction, positioning Kintyre Holdings as an investment holding company designed to foster sustainable growth across industries.

Financial Overview
Kintyre Holdings achieved strong growth in Q3 2024, driven by strategic investments and Visual Vibe’s expanding success in addition to gains from our investment assets.

Operational efficiency has improved, contributing to robust financial performance.

The Group is positioned for steady growth and profitability. Quarterly revenue reached $56.6 million, a 59.3% increase over Q3 2023, with year-to-date revenue at $128.4 million, up 57.5% year-over-year.

• REVENUE: Q3 2024 revenue reached JMD 55.1 million, up 59.3% from Q3 2023. Year-to-date revenue stands at JMD 123.4 million, showing a 57.5% increase over the same period in 2023, driven by strong performance in digital advertising.

• OPERATING PROFIT: Q3 2024 operating profit rose by 718.9%, from a loss of JMD 4.2M to a profit of JMD 26.2M. Year-to-date improved by 126.3%, from a
loss of JMD 126.4M to a profit of J$33.3M, driven by operational improvements and non-occurrence of one-off acquisition costs in 2023.

• Visual Vibe Operating Profit YTD 2024 vs YTD 2023: Year to date, Visual Vibe has posted a 46.8% increase in Operating Profits, bolstered by expanding its
network and introducing new advertising products like the backpack billboards and indoor digital screens.

• NET PROFIT: The Net profit for the parent company (Kintyre Holdings) Q3 2024 was JMD 21.4 million, an improvement from the loss of JMD 13.9 million recorded in Q3 2023.

• Year-to-date Net Profit stands at JMD 20.4 million, representing a significant improvement from the net loss of JMD 150.1 million in 2023. The positive shift in
net profit is attributed to the increased revenue from the DOOH advertising segment, greater control over operating expenses. YTD 2023 also had one-off acquisition related costs that weighed heavily on Net Profits.

• BALANCE SHEET: Total assets stood at JMD 564.7 million, down 19% year-over year, due to a reduction in goodwill and investments in assets. Total liabilities decreased by 40% to JMD 225.6 million, strengthening the company’s financial position.

Strategic Partnerships & New Business Initiatives
• New strategic partnerships for indoor advertising have been secured across the island, positioning Visual Vibe as a major player in the digital out-of-home advertising space.

• In addition, Kintyre Holdings has successfully partnered with SportsMax as their official out-of-home advertising partner for the 2024 Olympics. We showcased live streams of key races on our Hope Road, Spanish Town, and North Parade screens, reaching a wide audience and positioning our brand prominently during this high-profile event.
Physical and Technology Upgrades

• Visual Vibe upgraded its Manor Park screen to the latest technology, enhancing content quality and engagement.

• Yello Partnership: iCreate partnered with Yello to support SMEs by developing an affordable option for outdoor advertising, making high impact marketing accessible to smaller businesses across the region.

Impact of Hurricane Beryl
• Hurricane Beryl caused electrical outages and screen damage in remote areas, but we collaborated with JPS to use our screens for critical updates on rehabilitation efforts. This partnership minimized the storm’s impact and highlighted Visual Vibe’s role in community support during crises.

OUTLOOK
As we approach Q4 2024, Kintyre Holdings is focused on maintaining the growth momentum achieved in Q3. We are expanding our offerings, particularly through iCreate Institute’s new educational products, which will enhance our training services in the growing digital economy.

This expansion aligns with the increasing demand for innovative and agile upskilling
solutions.

Looking ahead, Kintyre Holdings is committed to operational efficiency, optimizing our assets, and driving cost-effective growth. We will continue to focus on executing our long-term strategy, ensuring profitability, and exploring new opportunities in key sectors to further strengthen our market position.

2024
Sustained Revenue Growth and Profitability:
• Target a 20% revenue increase in the second half of 2024 through expanded digital advertising and increased enrollments at iCreate Institute.
• Reach a net profit margin of 20% by optimizing operations and focusing on high margin business lines.

Expansion of Digital Advertising Network:
• Add 10 new indoor locations to our Digital Out-Of-Home (DOOH) network, leveraging partnerships that have been secured

Digital Transformation of iCreate Institute:
• Launch new courses and upgrade the learning management system to boost enrollment and enhance the student experience.

Strengthening Customer and Partner Relationships:
• Deepen existing partnerships, secure three new strategic partnerships, and achieve a 90% customer satisfaction rate by year-end.

Operational Efficiency and Cost Management:
• Reduce administrative expenses as a percentage of revenue from 60% to 50% by streamlining processes and adopting new technologies.

Corporate Social Responsibility and Community Engagement:
• Focus on creative talent development, digital literacy, sustainable business practices and promoting charitable causes.

Risk Management and Strategic Flexibility:
• Continue monitoring market trends, adjusting strategies as needed, and maintaining robust risk management to ensure stability and growth.

Tyrone Wilson Executive Chairman Kintyre Holdings (JA) Limited

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First Rock Real Estate Investments Registers Net Loss For Three Months Ended September 2024, Driven Primarily By Unrealised Foreign Exchange Losses

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November 16, 2024

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First Rock Real Estate Investments Limited registered a net loss attributable to Ordinary Shareholders for the three months ended September 30, 2024, totalling US$674,536, which yielded an Earnings Per Share (EPS) of negative US$0.002. Net loss attributable to Ordinary Shareholders for the nine months ended September 30, 2024, totalled US$1,453,640, which yielded an Earnings Per Share (EPS) of negative US$0.005.

The results were driven primarily by unrealised foreign exchange losses on translation of foreign currency denominated liabilities, which amounted to US$72,034 for the three months ended September 30, 2024 and US$275,170 for the nine months ended September 30, 2024. Additionally, interest expense amounted to US$118,839 for the three months ended September 30, 2024 and US$524,340 for the nine months ended September 30, 2024.

The Group’s financial performance continues to reflect the impact of the ongoing high-interest rate environment in Jamaica, which exerts downward pressure on property values, resulting in lower Property Income relative to prior year. Property Income totalled US$49,056 for the three months ended September 30, 2024 and US$1,916,074 for the nine months ended September 30, 2024.

To mitigate the impact on the bottom line from reduced revenues, the Group managed to reduce its overall Administrative & General expenses by 20% to US$2,274,250 for the nine months ended September 30, 2024, compared to the same period in the prior year. This cost management effort is part of our ongoing strategy to mitigate the impact of reduced revenues on the bottom line.

Outlook
The Group’s ongoing commitment to strategic growth remains steadfast as we navigate the headwinds that obtain in today’s real estate environment. By continuing to execute on our portfolio rebalancing strategy, which focuses on acquiring high-yield, income-generating properties across Latin America and the wider Caribbean region, we have built a resilient foundation that supports sustainable growth.

During the quarter our subsidiary, FirstRock Capital Cayman, entered into an agreement to acquire a fully tenanted investment property in Grand Cayman. As the largest acquisition in our portfolio, this property is poised to notably enhance our rental income stream, reinforcing our expansion across the region. Alongside this achievement, our two KFC locations in Costa Rica continue to deliver stable rental income under longterm lease agreements, with plans underway for additional site developments.

Looking ahead, we remain optimistic about finalizing additional acquisitions across the region, with several promising opportunities in advanced stages of negotiation. The Group remains committed to unlocking value through strategic investments, which we believe will yield substantial long-term benefits to our stakeholders.
Norman Reid J.P. Chairman First Rock Real Estate Investments Limited

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tTech Limited Announces Increased Share Acquisition by Simply Secure

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November 16, 2024

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Edward Alexander Executive Chairman of tTech Limited announced that Simply Secure Limited increased its shareholding in tTech to 69.1%, representing 73,229,223 shares. The increased shareholding includes the purchase of 20,719,366 shares from Norman Chen and G. Christopher Reckord. The acquiring entity, Simply Secure Limited, is owned by Kevin Gordon and Rob Mayo-Smith. Messrs. Gordon and Mayo-Smith are also the owners of Simply Secure LLC, a Managed Security Services Provider based in Ft. Lauderdale, Florida.

The increased shareholding puts Simply Secure Limited over the 50% ownership threshold of the issued and outstanding ordinary shares of the company, requiring Simply Secure to extend an offer to all remaining tTech shareholders to purchase their shares subject to approval from the regulators. The tTech board will also provide an opinion on their view of the fairness of the offer price.

Norman Chen,

G. Christopher Reckord.

Following the sale of their shares, Messrs. Chen and Reckord will be resigning as Directors of tTech.

Chairman of the tTech Board, Edward Alexander, stated, “I would like to thank Norman and Chris for their service to tTech. Their contribution as executives and directors has enabled much of the success that tTech has enjoyed to date. We now look forward to the continued growth that is expected through the increased ownership in the company by Simply Secure.”

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