FOLLOWING its cross-listing on the Jamaica Stock Exchange (JSE) last Thursday, Massy Holdings Limited’s president and CEO Elliott Gervase Warner expressed resounding confidence in Jamaica and the Government’s plan to improve the ease of doing business through public sector transformation, at the JSE’s 17th Regional Investments and Capital Markets Conference.

Warner made this remark in an interview with the Jamaica Observer at the Jamaica Pegasus hotel in St Andrew. Massy was listed on the final day with a market capitalisation of $243.77 billion. The JSE conference was held from January 24 – 27 in a hybrid format and featured speakers such as Prime Minister Andrew Holness, Prime Minister of St Lucia Phillip J Pierre and managing director of the Ghana Stock Exchange Ekow Afedzie.

“Our experience with listing and working with the Jamaica Stock Exchange and Barita really suggests that this is a great place to do business. In our three portfolios, we’ll be looking for further opportunities to deepen the Massy presence in Jamaica. This visit has been great for speaking to a number of people who can help us with that plan,” Warner said in replied to Finance Minister Nigel Clarke’s presentation last Wednesday. Clarke outlined plans to enhance business in Jamaica by giving disproportionate focus to the implementation of the restructuring of public sector compensation in the upcoming national budget.

This vote of approval by Warner comes as the Massy group looks for other avenues to broaden its presence in Jamaica. Jamaica makes up six per cent of third-party revenue and profit before taxation to Massy’s earnings. Massy Gas Products (Jamaica) Limited and Massy Distribution (Jamaica) Limited are the companies currently represented in the country. Massy earned TT$11.13 billion ($251.49 billion) in revenue and TT$929 million ($21 billion) in profit before taxation (PBT) for its 2021 financial year.

Though Warner didn’t give any indicative timeline or plans for deepening its Jamaica presence, he did state that the company will be renewing its fleet of vehicles with gas-powered trucks which are more efficient to haul the trailers. Warner met with the both head of Jamaican subsidiaries on his final day in the country as he explored opportunities.

“LNG (liquified natural gas) is becoming more available in smaller units. Here in Jamaica, we’re working with New Fortress Energy which brings in LNG to supply gas for the power plants to be an off-taker of LNG for our fleet of Gas Pro vehicles on the road,” said Warner.

He further cemented the company’s plans to look at routes not only in Jamaica but across the region to deepen its reach in the changing gas space. Massy’s gas portfolio contributed 10 per cent of group revenue, but 22 per cent of profit before taxes.

“In addition, there are opportunities in certain industries for us to supply or distribute LNG as opposed to LPG for burners, ovens and where the economics makes sense, be a distributor of LNG. That would be our role in the LNG supply chain. We’re not going to build a regasification facility,” Warner noted.

Despite the company not having Massy Stores or its motors and machines portfolio in Jamaica, Warner emphasised the company’s growing contribution from Colombia and Guyana to the group’s earnings. Massy Stores launched an augmented reality shopping platform in Barbados last year while it introduced a used car platform last week in Cali, Colombia. This forms part of the group’s plan to leverage technology further for growth.

“What this represents is Massy investing in technology, which is disruptive to our industries, to participate in our own self-disruption. We see that as a platform that we will expand with the global organisation in the Caribbean and across other countries in Latin America. Colombia will continue to be an important investment opportunity for us. We’ve become the largest multi-car dealer for used cars in Colombia for the seven short years we’ve been there. We still only have five or six per cent market share and there’s lots more opportunity to grow in that highly fragmented marketplace,” Warner noted.

While Massy’s JSE share price has dipped by 15 per cent since listing to $2,100.67, Chief Financial Officer Ian Chinapoo believes that the JSE will be the stepping stone to unleash Massy’s full growth potential.

“In the future, we do anticipate that we’ll need to raise additional capital and when we do, we’re very well positioned on the JSE and TTSE to go to capital markets as another form of raising capital to fund growth beyond our immediate plans. All of the portfolios are globally scalable, and they have room for growth not just in the Caribbean,” Chinapoo replied.

NCB Capital Markets Limited has put out a buy recommendation for Massy’s stock with a one-year price target of TT$116.88 ($2,696.77) before its 20 to 1 stock split to take effect on March 11 and a target of TT$5.84 ($134.84) post-split. JMMB Investments (T&T) Limited indicated in its quarterly update that Massy was fairly valued with a price target of TT$100.41 ($2,279.31) for investors. Massy’s price on the Trinidad and Tobago Stock Exchange has remained flat at TT$106 ($2,395.60) since listing.

“Our group has really focused on keeping our powder dry. When you’re ready for growth, you have to finance that growth. By having relationships with your bankers and capital market investors, it makes it attractive to them. We’ve brought down our debt to equity ratio from almost 40 per cent two years ago to 25.6 per cent at the end of 2021. As we continue to do that reduction, we create headroom for the group to access additional debt and equity capital. We’ve built up our cash reserves so that when opportunities present themselves, we can move very quickly,” Chinapoo closed.