Sabga III: Vaccine offers hope for economic rebound

Ansa Mc Al CEO Anthony Sabga III said on Thursday that the conglomerate has "a very positive outlook" owing to mass vaccinations helping the country rebound from the economic fallout of the covid19 pandemic, addressing a mid-year virtual shareholders meeting. He said the conglomerate remains "deeply encouraged."

"The outlook, pandemic aside, we are encouraged by the internal vaccination levels of our people. I believe the internal reported numbers are as high up as 70 per cent.

"We remain proponents of vaccination for the population, supporters of that, that support us having a healthy society and we encourage economic recovery."

Sabga touched on the performance of Ansa McAl's member companies. He said US Carib Beer in Florida had faced challenges described as "significant headwinds" but has now rebranded. "It is now where we want it to be." The conglomerate will launch its fifth brewery next year, in Antigua, he added.

Sabga saw opportunities in Guyana which has seen growth alongside its very robust oil, gas and gold sectors. In banking and finance, he noted the Bank of Baroda acquisition. Regarding manufacturing, he boasted of water treatment plant support in Jamaica, plus a relaunch of Ansa Packaging for glass and plastics. Amid construction sector interests from Jamaica to Guyana, Sabga hailed the integration of Berger Paints into the conglomerate.

Regarding the environment, he said the conglomerate was the region's biggest recycler of glass and plastic, was getting its distribution vehicles onto CNG and was investing deeper into renewable energy in Latin America. The conglomerate was also keeping a keen eye on opportunities in the maritime and healthcare sectors, he added.

Sabga said that as "a bit of a wild card," Ansa McAl would get into crypto currencies.

"We will be taking an interesting step and making a very measured acquisition, a measured investment, into the blockchain crypto currency space."
He viewed this sector as a promising developmental pole, and one of the best performing asset classes in history. Replying to a question, he said the conglomerate had survived a cyber attack last year and had since fortified the group's ICT security.

Group chief financial officer Nicholas Jackman earlier presented the conglomerate's first half 2021 highlights headlined, Recovery in 2021.

Expecting the conglomerate to play help lead the country out of the pandemic, he said, "We are set, we are in a good position, to take advantage of whatever investment opportunities that may come our way." Jackman said while revenue had fallen over the past year by $58 million from $2.734 billion to $2.676 billion, profit before tax was up by $158 million, from $147 million to $305 million. Earnings per share rose 130 per cent from 48 cents to $1.11. Total assets grew by six per cent, from $15.711 billion to $16.632 billion, while Ansa McAl's gearing ratio remained healthy at 11.4 per cent. Indicating by how much a company is leveraged, this ratio shows how much business funding is from lenders compared to from shareholders.

Jackman listed varying revenues in seven territories, displaying a slide headed, "Wider regional recovery offset headwinds in our two largest markets."

The conglomerate's revenues in Trinidad and Tobago were $1,947 million (down 2.1 per cent) and in Barbados $377 million (down 15.4 per cent), while also declining in St Kitts/Nevis by 2.8 per cent to $37 million. Ansa McAl earned $151 million in Guyana (up 14.8 per cent), $77 million in Grenada (up 18 per cent), $62 million in Jamaica (up 33.4 per cent) and $25 million in the US (up 37.9 per cent.)

Earnings per share was 50 cents, down from 61 cents in the first quarter, but ahead of last year's figures of 25 cents and 23 cents for the first two quarters respectively.

Jackman said after-tax earnings were up by 130 per cent, now at $225 million compared to $97 million last year. This is because Ansa McAl made $305 million in profit before tax and paid $80 million in tax, compared to corresponding figures last year of $147 million and $50 million.

By sector, Ansa McAl's profits before taxes were best in insurance and financial services at $160 million, up by 247 per cent. Manufacturing, packaging and brewing rose by 46 per cent to $104 million in profit, while automotive, trading and distribution gave a $50 million profit, up by 63 per cent.

However the media, retail and parent company sector showed a loss of $10.9 million, worsening by 618 per cent over last year's loss of $1.5 million.