Pulse Investments best-performing stock so far this year

Business

Pulse Investments best-performing stock so far this year

BY DAVID ROSE
Contributor

Sunday, July 05, 2020

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Pulse Investments Limited has closed out the first half of the year as the best-performing stock on the Jamaica Stock Exchange (JSE) with its stock price increasing by 117 per cent, rising by 364 per cent in the last 12 months.

While the overall JSE Index went down by 25 per cent with most stocks still in the negative, Pulse has defied the COVID-19 contraction to outperform its peers in profit, stock price appreciation, and resilience in the current environment. Pulse's share price has increased from $6 ($1.50 post-split) at the start of the year to $3.25 at the end of last Tuesday's trading.

In a release to shareholders on the impact of COVID-19, Pulse chairman and founder, Kingsley Cooper, reassured shareholders that the company would not be significantly affected in the results for the 2020 financial year ended June 30, 2020.

“While there will be a reduction in income for the last quarter of the financial year and 2-3 weeks of the previous quarter, this would only affect our international model agency commissions, our rooms business and Caribbean Fashion Week's live staging.” Cooper told shareholders.

He pointed out that these operations represent just over 10 per cent of the company's business and given that most of the financial year was not impacted by COVID-19, only about 2-3 per cent of Pulse's business is expected to be actually affected. According to the Pulse chairman, “We anticipate that we will make up for these challenges through reduced costs and increased income and profit from other areas, such as media, as well as gains on investment property.”

This comes after the company waived rent to its tenants for April at its Trafalgar Road and Villa Ronai locations in St Andrew. After posting a 118 per cent increase in net profit for the 2019 financial year, Pulse has already surpassed that record in nine months with a net profit of $769.5 million.

This was driven mainly by a $436.2 million fair value appreciation on their investment property and 38 per cent increase in revenue to $475.1 million. Total assets rose by 25 per cent to $4.6 billion with shareholders' equity increasing from $3.2 billion to $3.97 billion.

Pulse is advancing plans for returning to the equities market with an Additional Public Offer (APO) having received the green light from shareholders, who approved a resolution for this to be effected. The capital raised is proposed to be used for acquisitions, including a significant stake in Irie Jam, along with a cosmetics company owned by a famous international actress.

In 2017 the JSE awarded Pulse the best performing stock for the main market.


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