Members of the Senate in Jamaica recently approved the Trade (Amendment) Act, 2024, which was piloted by Minister of Industry, Investment and Commerce, Senator the Hon. Aubyn Hill.

He explained that insertion of new subsections in Clause Two of the legislation allows the Minister to facilitate importers who ordered or purchased consignments prior to the effective date of the prohibition Order – the Trade Plastics Packaging Materials Amendment Order 2024 – to import these goods without consequences.

“It should be noted that the Trade Plastic Materials Prohibition Amendment Order 2024 also provides that the distribution of plastic food containers should terminate on the 9th day of January 2025. As such, in the exercise of this discretion, the Minister will be guided by this timeline,” Senator Hill said.

The Trade Plastics Packaging Materials Amendment Order 2024 was promulgated on July 11, 2024.

The Minister further informed that Clause Two of the Act provides for the insertion of new Subsections Four, Five and Six.

Senator Hill explained that Subsection Four provides that, where an Order was made providing for an absolute prohibition on the importation of goods pursuant to Subsection 1A, the Minister may, by Order, specify that the consignments be treated in the same manner as goods imported prior to the effective date of such prohibition, if the Minister is satisfied of the matter in Subsection 5.

“Subsection 5 provides that the matter to which the Minister must be satisfied is that the relevant prohibited goods were ordered or purchased prior to the effective date of the prohibition. Subsection 6 provides that no criminal liability shall be imputed in respect of goods that are subject to an Order made under Subsection 4,” he said.

Senator Hill explained that the Bill seeks to amend Section 8 of the Act to provide for such Orders to remove consequences of the prescribed absolute prohibition for imported consignments of goods ordered or purchased prior to the effective date of the prescribed prohibition under Section 8 (1a) of the Act, which arrived in Jamaica on or after the effective date of the prohibition.

He further indicated that in 2018, the Government announced the implementation of a ban on the importation, manufacture and distribution of specific types of single use plastic products with the objective of safeguarding human health and the environment from the adverse impacts of plastics, in accordance with World Trade Organization Agreement obligations.

The Minister informed that on December 24, 2018, the Trade Plastics Packaging Materials Prohibition Order 2018 was published, prohibiting the importation of classes of plastic goods on a phased basis.

Senator Hill added that the Order was subsequently amended in 2022/23/24. He noted that these Orders were initiated by the Portfolio Ministry with responsibility for the environment, in collaboration with the Ministry of Industry, Investment and Commerce.

“In January 2024, the Government of Jamaica announced the implementation of the fourth phase of the ban on single use plastics, which would eliminate from the domestic market single use plastic food containers and replace Styrofoam containers as well as cosmetic care or personal care products for which microbeads or microplastics have been intentionally added,” the Minister said.

“The Government further indicated to the public that consignments ordered prior to the effected date of the prohibition would be allowed to be landed. In keeping with the main objective, the Trade Plastics Packaging Materials Amendment Order 2024 was promulgated on July 11, 2024, which effected an absolute prohibition on the importation of plastic food containers, effective as of that date,” he said.

Senator Hill noted that the prohibition has adversely affected importers who previously ordered or purchased consignments, which arrived or will arrive in Jamaica after the prohibition was in effect.

“The Government recognises the need to facilitate trade within Jamaica while, at the same time, safeguarding human health and the environment from adverse impacts of plastics. To address this issue, it was proposed that Section 8 of the Act be amended to empower the Minister to make Orders having retroactive effect,” he said.

The Trade Act provides for, among other things, the regulation of trade in goods, including the conditions of distribution, purchase and sale, and the importation and exportation, except under licence, of goods of any class or description.

By: Chris Patterson, JIS

Alexander Melville Chief Executive Officer Tropical Battery Company Limited Has Released The Following Interim Report To Shareholders Q3 Fy2024 (April 1, 2024 To June 30, 2024)

Financial Highlights

For the Quarter April 1 to June 30, 2024

For the third quarter of 2024, we reported exceptional financial results, with gross operating revenue reaching $1.9 billion from $782.8 million last year, an increase of 143.6% year-over-year. This growth is primarily attributed to the 100% acquisition of Rose Batteries in San Jose, California, and the 51% acquisition of Kaya Energy in the Dominican Republic. These strategic moves have significantly contributed to our growth trajectory.

Our gross profit for the quarter was $623.3 million, up 172.6% from the previous year. This indicates higher sales volumes, improved cost efficiencies, and favourable pricing strategies.

The quarter’s EBITDA was $255.1 million, a 272.8% increase year over year, which underscores our ability to optimise cost structures and enhance profitability from core operations.

Net income for the quarter more than doubled to $121.3 million, up 212.5% from last year. This shows our effective expense management and execution of growth strategies. Additionally, our Return on Equity (ROE) for the quarter was 38.7%, reflecting robust financial health and efficient management.

For the 9 Months YTD

Our financial performance saw material growth for the first nine months of FY2024, with gross operating revenue doubling from $2.13 billion in the previous year to $4.27 billion.

Gross profit rose by approximately 104% from $667 million to $1.36 billion. Operating profit has increased 136% from $195 million to $460 million, underlining good operational management and strategic execution. This was supported by notable non-recurring acquisition-related costs of approximately $77 million, reflecting our strategic investments for long-term growth. Additionally, administration, marketing, and selling expenses rose by 74.1%, from $472 million to $821 million, due to expanded operations.

Despite these costs, our Profit After Tax (PAT) for the nine months increased by 65.8% to $220 million.
This financial summary underscores Tropical Battery Company Limited’s year-to-date performance, which is marked by revenue growth, cost management, and profitability. This position puts the company on a solid path toward achieving its long-term financial targets.

The acquisitions of Rose Batteries and Kaya Energy have been instrumental in driving this impressive growth, reflecting the company’s strategic focus on expanding its market presence and enhancing its product offerings.

Industry Update

In 2024, the energy storage and renewable energy industries are witnessing noteworthy growth, driven by healthy investment, technological innovation, and strong policy support.

Energy Storage Industry

The energy storage sector is experiencing expansion, highlighted by a 3.56% increase in companies globally, totalling 13,900, and the addition of 114,000 new jobs, bringing the workforce to 1.7 million.

Investment remains vibrant, with an average funding round value of $84 million across over 5,230 rounds. Technological advancements are robust, with 31,700 patents filed focusing on battery technologies, supercapacitors, and grid storage systems. Notably, prices for lithium-ion batteries and energy storage systems are expected to decrease, benefiting both the electric vehicle and stationary storage markets.

Renewable Energy Industry

The renewable energy sector is also expanding, with a 2.45% growth and an employment surge to 8.2 million globally. The industry sees substantial funding, with over 25,000 rounds recorded and significant technological advancements in modular electrolyser systems, distributed energy resource management, and advanced photovoltaics. Supportive policies and large infrastructure investments are enhancing grid resilience and accelerating the deployment of renewable technologies.

Both industries benefit from the involvement of major investors and a conducive regulatory environment, positioning them as key drivers in the global shift toward sustainable energy solutions.

Strategic Developments

Our strategic acquisitions have played a crucial role in our growth this quarter. The integration of Kaya Energy and Rose Batteries has expanded our market presence and brought in advanced technological capabilities and a wealth of expertise, increasing our team to 185 outstanding members.

We have seen significant improvements in operational efficiencies. Our cost management strategies have been instrumental in achieving higher gross profit and EBITDA margins. The seamless integration of our recent acquisitions has enhanced operational collaborations and efficiency, contributing to our overall positive financial performance.

Key Performance Indicators (KPIs)

Operational efficiencies have seen significant improvements across the board. Our inventory turnover ratio improved from 2.5 to 3.5, and the cash conversion cycle was reduced significantly to 109 days from 148 days, highlighting our enhanced management of working capital.

ESG

Our commitment to Environmental, Social, and Governance (ESG) principles remains strong. We completed essential regulatory compliances and continued our community engagement and environmental stewardship efforts. We collected and recycled significant amounts of plastic and participated in community-enriching activities, including beach clean-ups and educational support.

Our dedication to safety, compliance, and continuous improvement was evident this quarter through several vital achievements. We completed our Jamaica Ferry location’s statutory equipment inspection certification and submitted it to the Ministry of Labour. Additionally, we submitted the renewal application for our Factory Re-registration and successfully underwent a site inspection by the Ministry of Labour.

Our Public Procurement Certification was also renewed, enabling us to bid on government contracts. Our corporate social responsibility initiatives demonstrated our commitment to sustainability and community support. As part of our waste management program, we collected and recycled 166 pounds of plastic bottles, reducing environmental impact. We also collected and exported 203 metric tons of lead-acid spent batteries, filling ten 20-foot containers.

We also supported the Little Einsteins Learning Centre by sponsoring trophies and awards for their graduation ceremony.

Collaborating with Tropical Renewable Energy and the JPS Foundation, we participated in a beach clean-up exercise, underscoring our commitment to environmental stewardship. Additionally, we sponsored Labour Day projects, including a beautification project in Montego Bay and a tree-planting exercise at the Hydel Group of Schools.

Outlook

Looking forward, Tropical Battery Company Ltd. is set on maintaining a robust growth trajectory with a strategic focus on expanding our operations, optimising efficiency, and exploring new market opportunities. Our goal to achieve consistent double-digit revenue growth and elevate PAT above 10% by leveraging our group entities’ strengths and innovative technologies is more aligned than ever.

For More Information CLICK HERE

On Thursday, July 30, 2024, the JSE launched the Jamaica Green, Social, Sustainability and Sustainability-Linked Bond Guide (GSS+ or Green Bond) which is a comprehensive resource designed to support issuers, investors and other stakeholders in navigating the evolving green financing landscape. It provides detailed insights into the principles, frameworks and best practices underpinning these financial instruments. The Green, Social, Sustainability and Sustainability-Linked Bond Guide was developed with the support of IDB Invest and other local and international partners.

Managing Director of the Jamaica Stock Exchange Dr. Marlene Street-Forrest said: “Today marks a significant milestone in our collective journey towards a more sustainable and environmentally responsible future for all Jamaicans and investors in Jamaica. We are reminded of the urgent need to address the global challenges posed by climate change, environmental degradation and social inequity, which significantly challenge and impact small island countries like ours because of geographic location and limited resources. The financial sector has a leading role to play in ensuring that we mitigate the risks by providing funding and governance for green initiatives and it is for this reason we introduce to the market what we believe is a powerful tool in assisting in moving the needle forward. “

“We are happy to report that there are prospective issuers, not only in Jamaica, but within the region, who are excited about the potential opportunities to issue green bonds. Given the global challenges posed by climate change and social inequality, Investors are showing a growing interest in supporting the global sustainability agenda and aiding the shift towards a low-carbon, equitable economy. Therefore, it is fair to assume that there is a market, and this market could prove active for investors within this space.” she concluded.

Minister of Finance and the Public Service Dr. The Honourable Nigel Clarke, the Guest Speaker at the event told the audience that there are hundreds of billions of dollars available in the global financial markets to finance green projects, and Jamaica must seek to capitalize on this to build climate resilience and advance its energy mix. He used Hurricane Beryl and the damage it caused to the country’s infrastructure and lives to urge financial entrepreneurs to enter the green bond space.

He credited the Jamaica Stock Exchange for leading the charge by setting the framework and guidelines for a green bond market to operate. He indicated that the substantive work has been done and it is going to be necessary for others to follow up. Dr. Clarke said “The things that are good for us, that are necessary for our own sustainability are too expensive for us to undertake. So, the innovation that exists for us to solve this problem is green financing.”

He stated that Jamaica’s Green Bond Guide allows us to compete as we can now produce guidelines that when we say to the world that we have a green issue, there is the institutional mechanism which underpins authenticity.

The finance minister expressed satisfaction that Jamaica is creating the infrastructure to enable green financing to take off; to enable Jamaican projects and institutions to tap into this growing and significant pool of funds. He expressed that Jamaica would need credible, dynamic, financial entrepreneurs and it will take a different type of thinking to exploit all the opportunities.

“I am saying to the world that Jamaica is ready and there is a house for your green dollars here. Even the government of Jamaica will need to access green financing for its projects. This is a brand-new area that entrepreneurial financial intermediaries are expected to take full advantage of so that we can engage in the kind of adaptation and mitigation measures so that we can be more resilient against the natural disasters to which we are vulnerable. We must take responsibility for our vulnerability and this green, social, sustainability and sustainability-linked platform is a perfect example of this.” he added.

Among the specially invited guests were members of the green energy sector, the financial sector and the regulatory sector.

Mr. Wayne Wray, Director of Innovative Energy Group, outlined his company’s vision to capitalize on investments in the green bond sector. He said: “Successful green bond listings will require large, diverse and reputable partners and we at IEG have begun that engagement with those stakeholders. As IEG organizes for the next round of acquisition we believe that Jamaican listed companies with the requisite corporate governance guidelines and the transparent reporting requirements of the JSE are better equipped for success.”

Remarks were also brought by Ms. Monique French, Chief Credit Officer CIBC Caribbean and Mr. Angus Young, Chief Executive Officer of NCB Capital Markets who both endorsed the initiative and pledged to continue to work with the green energy sector to build a robust pipeline to develop local and regional programmes.

Ms. Malini Samtani, Climate Change Officer, Advisory Services Division, IDB Invest gave a presentation on GSS+ bonds demonstrating how governments and the private sector can work together to maximize benefits in the green bond sector.

Mrs. Yvonne Vogt, Consultant of legal partners HPL, LLC whose firm worked with key stakeholders in developing the Guide and explained key aspects of the Guide and Mr. Dereck Rajak, Chief Executive Officer of CARICRIS (Caribbean Information and Credit Rating Services) who will be working with the Jamaica Stock Exchange, to rate Green Bond prior to and post issuance were the other presenters.

Source JSE

Alexander Melville Chief Executive Officer Tropical Battery Company Limited Has Released The Following Interim Report For 2nd Quarter 2024

Overview
Tropical Battery Company Limited experienced a remarkable period of growth in Q2 FY2024, marked by substantial revenue and gross profit increases. This success is primarily attributed to strategic acquisitions, including Rose Batteries in Silicon Valley, California, and Kaya Energy Group, acquired in Q3 FY2023.
The Rose Batteries team’s strength was further enhanced by adding key personnel, including Katey Daniel as the new Customer Success Manager and Noelle Machado as the Procurement Manager, who have made significant positive impacts. Wouter Potman, Rose’s recent Project Management hire, has also made substantial improvements in professionally documenting the status of the development pipeline, reinforcing the effectiveness of the project management strategies.
KAYA Energy successfully navigated public relations challenges and regulatory uncertainties in the renewable energy sector to close several vital deals north of $250 million for the quarter.

Financial Review
The statement of financial position as of March 31, 2024, illustrates a dynamic period of growth fuelled by strategic acquisitions and significant capital investments. The acquisition of substantial new assets and the expansion into new facilities have poised the company for continued success in its market sector. Moreover, the planned deleveraging through an Additional Public Offering indicates a proactive approach to managing increased debt levels, aiming to optimise the financial structure and enhance shareholder value. The overall economic health of Tropical Battery is robust, with strong liquidity and asset bases that provide a solid foundation for future growth and profitability.

Revenue and Gross Profit
During Q2 FY2024, Tropical Battery’s gross operating revenue increased, climbing from $700 million in Q2 FY2023 to $1.5 billion in the current fiscal year, representing a surge of approximately 121%. This significant rise is directly linked to the company’s recent acquisitions, which expanded its market presence and operational scale. The gross profit also reflected this positive trend, increasing from $223 million to $489 million, translating to a growth of 119%. These figures underscore the successful integration of the new acquisitions and suggest an effective management strategy for leveraging new assets to enhance overall profitability.

Expenses and Operating Profit
During the fiscal period, we witnessed notable increases in specific expense categories. Non-recurring acquisition-related costs amounted to $77 million, reflecting the one-time cost of the recent acquisitions. Additionally, administration, marketing, and selling expenses rose from $161 million to $305 million, an increase of 90%. This escalation is due to the expanded operations and the need to support a larger organisational structure post-acquisition.
Despite these increased outlays, operating profit improved significantly by 71%, from $62 million in Q2 FY2023 to $107 million in Q2 FY2024, indicating effective cost management relative to the increased revenue. Furthermore, if we add back the one-time nonrecurring acquisition-related cost of $77 million, the increase in operating profit would be significantly higher.

Finance Costs and Net Profit
Finance costs presented a challenge, escalating by 526% from $16 million to $102 million. This rise was partially offset by increased finance income, which increased from $11 million to $38 million. Net finance costs after adjustments stood at $64 million. These costs notably impacted profit before taxation, which decreased from $50 million to $27 million.

Strategic Financial Planning
Tropical Battery plans to deleverage its balance sheet through an Additional Public Offering (APO) to enhance financial stability and reduce interest costs. This offering is set to raise significant capital and pay down existing debt substantially, which is expected to lower interest costs moving forward and contribute positively to the company’s financial health.

Company Outlook
Tropical Battery Company Limited’s strategic financial decisions have dramatically transformed its landscape over the last six months. The investment in acquisitions and capital expenditures, supported by substantial financing activities, has set the stage for expanded operations and potential revenue growth.
To achieve greater cohesion across the markets we serve — Jamaica, the Dominican Republic, and the United States — we plan to capitalise on the synergies among Tropical Battery, Kaya Energy, and Rose Batteries. This strategy is designed to expand growth opportunities and realise cost efficiencies throughout the group. By synchronising our operations, strengthening our market presence, and leveraging our brand advantages, we aim to develop a unified group strategy that enhances efficiency and increases profitability.

Our approach includes thoroughly reviewing and integrating systems and processes to ensure smooth coordination among the three companies. This alignment is expected to enhance our return on capital employed, drawing on the combined strengths of these distinguished brands to foster growth, drive innovation, and deliver exceptional customer service.

The planned APO represents a proactive strategy to optimise the financial structure and support sustainable development. The strategic benefits of these acquisitions and financial strategies are expected to materialise over the coming periods, potentially leading to enhanced economic performance.

For More Information CLICK HERE

In the last three months, the ustomised smart battery industry has also made significant strides alongside the broader growth observed in the renewable energy and energy storage sectors. This niche within the energy storage market has been gaining momentum, fuelled by technological advancements and increased demand for personalised energy solutions that cater specifically to unique operational needs that benefit us.

The industry’s development is buoyed by the regulatory and financial frameworks propelling the renewable sector, particularly the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA). These acts have facilitated a surge in investments to enhance battery technology capabilities, including developing intelligent batteries that are more efficient, durable, and capable of interfacing with various digital management systems.

Customised intelligent batteries are increasingly critical components in integrating renewable energy systems. They offer optimised storage solutions that adapt to different scales and types of renewable energy installations. They are vital in applications requiring high reliability and efficiency, such as utility-scale solar and wind projects, where they help stabilise the grid and manage output variability.

Moreover, the drive towards domestic production emphasised by recent policy initiatives has strengthened the supply chain for intelligent battery components. This domestic focus not only aids in reducing logistic vulnerabilities but also supports the U.S. economy and job creation in the tech and manufacturing sectors. As more companies enter the smart battery market, competition is spurring innovation, leading to rapid advancements in battery technology that could further enhance the performance and cost-effectiveness of these systems.

Customised intelligent batteries are increasingly critical components in integrating renewable energy systems.

The customised smart battery industry is well-positioned to capitalise on the growing shift towards cleaner energy solutions. It will play a pivotal role in the green transition while continuing to evolve in response to technological advances and market demands.

Alexander Melville Chief Executive Officer Tropical Battery Company Limited