Durrant Pate/ Contributor

As it celebrated 100 years in business, Trinidad & Tobago (T&T) based Massy Holdings is reporting after-tax profits of TT$833.3 million for the financial year ended September 30, 2023, representing a 21 per cent increase compared to the TT$689 million it earned in its 2022 financial year.

The T&T-based Caribbean conglomerate generated third-party revenue of TT$14.2 billion in its 2023 financial year, which was an increase of 15 per cent over the TT$12.3 billion in revenue reported in 2022. The group’s before-tax profit from continuing operations grew by 23.5 per cent from TT$995 million in 2022 to TT$1.22 billion in 2023.

Massy’s chairman Robert Riley advised that “an additional TT$1.1 billion (US$158 million) in revenue and TT$142 million (US$21 million) in profit before tax were derived specifically from the three additions. We are actively engaged in efforts to integrate these companies within the Massy Group”.

Debt financing for acquisitions

During the financial year, Massy closed three significant acquisitions, namely Rowe’s IGA Supermarkets, an independent supermarket chain in Jacksonville, Florida; Air Liquide T&T, a manufacturer and supplier of industrial and medical gases in T&T; and IGL (St Lucia) Ltd, the parent company of a cooking gas distributor and manufacturer and distributor of industrial and medical gases in Jamaica.

Riley said the group invested US$240.5 million in debt financing to make the acquisitions in the last financial year. That increased the group’s debt-to-equity ratio from 25 per cent to 46 per cent, which “remains well within a tolerable limit”.

“Massy maintains TT$1.3 billion (US$191 million equivalent) in cash at the end of the year and a highly liquid US-dollar investment portfolio, which fully secures US$126.6 million of margin-line debt, without which the group’s debt-to-equity ratio would drop to 35 per cent.”

Riley explained that with the nearing completion of the group’s divestment agenda, profit after tax from discontinued operations declined from its 2022 financial year. He explained that the companies whose operations were discontinued in 2022 did not contribute to the group in 2022 and some of the one-off gains on sales of assets and companies (such as Massy United) were not repeated in the 2023 fiscal year.

Impairments with non-core real estate assets

In the 2023 financial year, discontinued operations produced a loss of TT$20.4 million, mainly derived from impairments associated with non-core real estate assets and businesses in Barbados slated for divestment in financial year 2024. This, is in comparison to the profit after tax contribution of TT$169 million from discontinued operations in 2022.

As a result, the group’s after-tax profit (after discontinued operations) declined by 5 per cent to TT$813 million in 2022 from TT$858.18 million in 2023. The group’s earnings per share declined from TT$0.411 in 2022 to TT$0.386 in 2023.