Massy Holdings profits up 4% in six months

DESPITE escalating inflation and the fallout from Russia’s invasion of Ukraine, Massy Holdings Ltd has earned a four per cent increase in profit for the first half of the 2022 financial year.

In its unaudited consolidated financial statements released on Thursday, chairman Robert Bermudez said the group’s main portfolios and lines of business performed commendably.

It reported a four per cent increase in after-tax profit from $314.3 million in the same period of 2021 to $326.8 million.

“Third party revenue grew by 9.6 per cent from $5.61 billion in the first of half of 2021 to $6.15 billion in the first half of 2022. Profits before tax from the group’s operating subsidiaries increased by 20 per cent or $87.7 million over the same period.

“Profit before tax from the integrated retail portfolio increased by 25 per cent over the prior year and profit before tax from the motors and machines portfolio and the gas products portfolio increased by 23 per cent and 21 per cent respectively.

“Massy remittance services in Guyana pulled the financial services line of business to a six per cent improvement in profit before tax over prior year.”

The growth in integrated retail came from all markets especially Guyana, TT and Barbados, he said.

“The growth in motors and machines were driven by the rebound of Massy Motors in Trinidad but also supported by growth in Massy Machinery, Massy Motors Guyana and Massy Motors Colombia.

“Growth in the gas products portfolio mainly derived from significant half year growth from Massy Gas Products Trinidad and from growth in Guyana and the energy services company in Trinidad.”

Bermudez said the group also faced its fair share of declines in areas of the group’s divestment funds and captive reinsurance portfolios and from higher expenses in the corporate office.

Divestment funds and the captive reinsurance portfolios contributed to a combined loss of $12 million.

“Increases in US federal interest rates as well as escalating inflation have negatively impacted both bond and equity markets in the US and beyond. This has all been further exacerbated by Russia’s invasion of Ukraine. Higher department costs and consolidation adjustments in the first half of 2022 also negatively impacted head office and other adjustments.

“Profit before tax from associate companies declined by 17 per cent due to the termination and winding down of major contracts at Massy Wood but profit after tax from discontinued operations increased by 43 per cent driven by the strong performance of Massy United Insurance in the first half of 2022.”

Bermudez added that the group continued to grow and enter into new markets, with the launch of five new Massy Stores under its integrated retail portfolio and acquired its second LPG distribution in the Boyacá region of Colombia and commenced operations of Motors and Machines Miami Distribution Inc. It also started the distribution of Shell lubricants throughout the Caribbean and South America.

It also entered the Jamaican Stock Exchange through a cross-listing and implemented a stock split of 20 new Massy Holdings shares for each original share held.

“From trading data reported on the Jamaica Stock Exchange and TT Stock Exchange, combined trading volumes have increased by 70 per cent, providing some early evidence that the intended objective to enhance retail trading in Massy’s shares in Jamaica as well as in TT is being fulfilled. The group’s earnings per share increased by four per cent consistent with its profit after tax growth.”

Bermudez said the share purchase agreement to sell Massy United Insurance Ltd to CG Insurance was finalised and net proceeds from the transaction will be added to the divested funds portfolio.

A dividend of three cents which represented a nine per cent increase over restated half-year dividend in 2021 of 2.75 cents will be paid.