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Faceys restructure holdings, Pan-Jam profits rise to $2.85b

Published:Wednesday | March 11, 2015 | 12:00 AM
Stephen Facey, chairman and CEO of Pan-Jamaican Investment Trust.
Paul Facey, vice-president of investment, Pan-Jamaican Investment Trust.

The 24.4 million units of Pan-Jamaican shares that traded on the Jamaica Stock Exchange on Friday, representing just over 11 per cent of the conglomerate's equity, is linked to dealings between family members, according to chairman and chief executive officer Stephen Facey.

The trades on Friday were valued at $1.3 billion. The stock closed down 70 cents on the day at $53.20 per share.

Facey, who was in a meeting, but spoke to Wednesday Business through his assistant, said the transaction was an "internal family restructuring".

Pan-Jamaican Investment Limited is a property conglomerate founded by the late Maurice Facey, who passed away in 2013, with holdings in real estate, tourism, insurance/financial services, coffee, agro-processing and retail.

Stephen and Paul Facey are tied to at least 40 per cent the company through personal holdings and connected parties.

Both are executives of the company and sit on the board, and both have connections to equal amounts of shares via connected parties, at least up to end of December, and while disclosures indicate connections to more than 86 million shares for each man, it appears to include their overlapping interests.

largest blocks of shares

The comglomerate's shareholder base totals 3,062. The largest blocks of shares are held by: Boswell Investments Limited, Sagicor Pooled Equity Fund, Orange Hall Estates Limited; National Insurance Fund; Scotia Jamaica Investment Management a/c 3119, Stephen and Wendy Facey; Guardian Life Limited; Caenwood Securities Limited; Paul Facey, and Cecil Boswell Facey Foundation.

Pan-Jam is among the most profitable companies listed on the stock market.

The group just reported a 14 per cent improvement in net profit to more than $2.85 billion or $13.55 per share at yearend December 2014. In a report on its shareholders, Pan-Jam said its associated companies and joint ventures contributed $2.7 billion to the group, half-billion dollars more than 2013, with star performer Sagicor Group Jamaica accounting for $2.66 billion of the total.

Mavis Bank Coffee Company was the only loss-maker, with Pan-Jam share of losses for its 50 per cent stake amounting to $39.6 million.

In its core operating segment, property services, Pan-Jam reported revenue of $1.55 billion, up five per cent, while total revenue was $1.94 billion.

The company's equity base rose from $18 billion to $21 billion, pushing its book value per share to $100.81 or close to two times its share price. Total assets grew from $23 billion to $26 billion. Stephen Facey, in a report to shareholders released with the company's audited results, said the highlight of 2014 was the purchase of the Oceana Hotel in downtown Kingston in partnership with Canadian firm Downing Street Partners Realty. The deal closed in 2015.

The company is also wrapping up construction of a Courtyard by Marriott hotel in New Kingston, which is slated for a mid-2015 opening.

Facey said he anticipated growth for the company as the economy rebounds, having reported that Pan-Jam experienced lower investment income, driven by reduced capital and foreign exchange gains and higher impairment charges on available-for-sale securities last year.

This was partially offset by improved revenue from property that was driven by an 11 per cent increase in rental income; just as a $127 million increase in operating expenses was largely offset by a $102 million decrease in finance costs.

Pan-Jam was formed half a century ago in 1964 and was among the first to be listed on the stock exchange.