• Medical Disposables & Supplies Limited (MDS) reported a net loss of $201.83Mn for the twelve-month period ended March 2025, marking the second consecutive year of losses. The sustained underperformance was largely driven by elevated operating expenses, which continued to constrain the company’s ability to convert revenue growth into profitability.
• During the financial year, revenue grew modestly by 4.7% to $3.88Bn, up from $3.71Bn in the previous year. Stronger performance in the second half of the year, underpinned by improved sell-through across the pharmaceutical, medical, and consumer divisions, accounted for the growth in MDS’ topline.
• Cost of sales rose slightly by 0.4%, increasing at a much slower pace than revenue. This reflected the absence of a large inventory write-down seen in the prior year, which had stemmed from slow-moving and near-dated stock. Consequently, gross profit improved by 22.8%. However, when adjusted for non-recurring effects, gross profit from core operations actually declined, primarily due to temporary sales disruptions at a subsidiary undergoing rationalisation, including changes in supplier relationships.
• Operating expenses surged by $138.92Mn (15.62%), largely due to a one-off provision totaling $144Mn within Cornwall Enterprises, a subsidiary. This included $18Mn for slow-moving inventory and $126Mn for related-party balances. This was the primary driver of the weaker earnings.
• Other contributors to the rise in costs included: Emergency repair expenses and hurricane preparedness measures (Hurricane Beryl), higher insurance premiums, costs related to new business acquisitions, increased staff turnover and strategic investments in sales and merchandising staff to drive distribution growth. That said, these increases were partially offset by improved cost discipline in marketing and promotional spending.
• Looking ahead, MDS has begun diversifying its product mix and expanding regionally. The company has entered the fast-moving consumer goods (FMCG) space by becoming a non-exclusive distributor of True Pet Food in Jamaica. It is also establishing MDS Cayman, a new subsidiary aimed at distributing pharmaceutical and medical supplies across the Cayman Islands and the broader Caribbean, signaling a push toward new markets and revenue streams.
• Despite the softer earnings, MDS’s stock price has declined by 18.2% year-to-date, closing at $1.35 as at Tuesday. At this price, the stock is trading at a price-to-book (P/B) ratio of 0.59x, which is lower than the Junior Market Health Sector’s average of 1.94x.

(Sources: JSE & NCBCM Research)

• Dolla Financial Services Limited (DOLLA) announced that it received notice of Widebase Limited (Widebase) acquiring an additional 7.00% stake in the company, increasing its total ownership to 21.00%.
• The completion of this transaction is subject to regulatory approval from the Bank of Jamaica, the governing authority for micro-credit institutions, for Widebase to own 20.0% or more of Dolla.
• As at March 2025, only Dequity Capital Management Limited (20.0%), FirstRock Private Equity Limited (16.0%), Supreme Ventures Limited (15.0%), and Mayberry Jamaican Equities held a greater percentage of total units than Widebase Limited.
• Widebase is a wholly owned subsidiary of Mayberry Group Limited (MGL), which also owns Mayberry Jamaican Equities. As a result, MGL could potentially control 32.6% of the total units.

(Sources: JSE & NCBCM Research)

• Economic growth in Barbados is set to slow in 2025, primarily due to the United States (U.S.) trade policy and a related global economic slowdown. Real GDP is forecasted to expand by 1.7% in 2025 according to Fitch Solutions, moderating from an estimated 4.0% growth rate in 2024. This marks a downward revision from Fitch’s previous 2025 forecast of 2.5%.
• In 2025, Barbados is expected to be significantly impacted by U.S import tariffs. Almost a fifth of the country's goods exports were sent to the U.S. in 2024, with the largest categories, including beverages (mainly rum), jewellery and various light-manufacturing products such as trailers. These products will lose some competitiveness in the U.S. market due to the 10% baseline tariffs. Furthermore, real GDP growth in the U.S. is expected to slow from 2.8% in 2024 to 1.2% in 2025, weakening demand for imported goods generally.
• More importantly, lower tourism arrivals will be the main drag on economic growth due to the negative impact on export receipts and the knock-on effect on private consumption and investment. Although exempt from U.S. tariffs, tourism receipts in Barbados will be negatively affected by U.S. trade policy. A tariff-induced economic slowdown in the U.S. and other tourism source markets will weaken arrivals in Barbados.
• Barbados has increased its reliance on US tourists in recent years as airline passenger capacity between the two countries doubled over the past decade. U.S. tourists typically make up a third of total arrivals and accounted for three-quarters of the growth in tourism arrivals in 2024. The U.K., Canada and the EU account for another 50% of tourists, and Fitch forecasts slower economic growth in all these markets in 2025.
• Overall, services exports (mainly tourism) are expected to contract by 2.0% in real terms in 2025, the first decline since the Covid-19 pandemic. Consequently, weakness in the tourism sector will drag on private consumption and investment growth in the wider economy as the sector accounts for around 15% of GDP and 20% of employment (directly and indirectly).

(Source: Fitch Connect)

• The World Bank on Tuesday slashed its global growth forecast for 2025 by 0.4 percentage point to 2.3%, noting that higher tariffs and heightened uncertainty posed a "significant headwind" for nearly all economies.
• In its twice-yearly Global Economic Prospects report, the bank lowered its forecasts for nearly 70% of all economies - including the United States, China and Europe, as well as six emerging market regions - from the levels it projected just six months ago before U.S. President Donald Trump took office.
• Trump has upended global trade with a series of on-again, off-again tariff hikes that have increased the effective U.S. tariff rate from below 3% to the mid-teens - its highest level in almost a century - and triggered retaliation by China and other countries.
• The World Bank is the latest body to cut its growth forecast because of Trump's erratic trade policies, although U.S. officials insist the negative consequences will be offset by a surge in investment and still-to-be approved tax cuts. The bank stopped short of forecasting a recession but said global economic growth this year would be its weakest outside of a recession since 2008. By 2027, global gross domestic product growth was expected to average just 2.5%, the slowest pace of any decade since the 1960s.
• The report forecasts that global trade would grow by 1.8% in 2025, down from 3.4% in 2024 and roughly a third of its 5.9% level in the 2000s. The forecast is based on tariffs in effect as of late May, including a 10% U.S. tariff on imports from most countries. It excludes increases announced by Trump in April and then postponed until July 9 to allow for negotiations.
• "Risks to the global outlook remain tilted decidedly to the downside," the bank wrote. It said its models showed that a further 10-percentage point increase in average U.S. tariffs, on top of the 10% rate already implemented, and proportional retaliation by other countries, could shave another 0.5 percentage point off the outlook for 2025.
• Such an escalation in trade barriers would result "in global trade seizing up in the second half of this year ... accompanied by a widespread collapse in confidence, surging uncertainty and turmoil in financial markets," the report said. Nonetheless, it said the risk of a global recession was less than 10%.

(Source: Reuters)

• U.S. small-business confidence improved in May, likely because of a de-escalation in trade tensions between Washington and China, though uncertainty over the outlook mounted amid worries over the fate of President Donald Trump's tax-cut agenda.
• The National Federation of Independent Business said on Tuesday its Small Business Optimism Index increased three points to 98.8 last month, rising for the first time since December.
• The trade truce resulted in the Trump administration slashing tariffs on Chinese goods to 30% from 145.0% through early August. That probably led small business owners to anticipate higher sales, accounting for most of the increase in the index. But the survey's uncertainty index rose two points to 94.
• The share of small businesses expecting higher inflation-adjusted sales volumes jumped 11 points to 10.0%, accounting for most of the improvement in the Optimism Index. There was also a big rise in the proportion expecting better business conditions, though the share reporting taxes as their single most important problem increased.
• The share viewing current inventory as "too low" was the highest since August 2022. That, together with lengthening delivery times of inputs to factories, suggests shortages of some goods and price hikes could be looming.

(Source: Reuters)

• Scotia Group Jamaica Limited (SGJ) reported a net profit of $9.2Bn for the six-month period ended April 2025, representing a 7.8% year over year increase. This was primarily driven by broad-based improvements across all business segments. However, its second quarter earnings actually fell by 7.6% due to elevated operating expenses that exerted downward pressure on the bottom line.
• Net Interest Income for the six-month period rose by 8.5% to $24.25Bn, underpinned by sustained growth in the loan portfolio. Notably, mortgage loans increased by 14.0%, while consumer loans grew by 8.0%, underscoring continued expansion in core lending segments.
• In addition to interest income, net insurance revenue surged by 75.6% or $797.40Mn supported by higher contractual service margin (CSM) releases and improved portfolio efficiency. The performance also benefited from stronger transaction volumes and lower insurance-related expenses.
• Operating expenses climbed by 16.6% for the six months period, with the second quarter operating expenses alone increasing by 22.8%. Higher staff costs, increased technology-related expenses aimed at process improvements, and rising cash transportation costs accounted for the growth in operating expenses. As a result, the cost-to-income ratio rose by 175 basis points to 56.0%, highlighting the near-term pressure from increased expenditures.
• Despite this, SGJ’s continued investment in technology and process improvements reflects a strategic focus on enhancing operational efficiency. While these initiatives have contributed to short-term cost pressures, these investments are expected to improve productivity and cost management over time. 
• On the stock Market, SGJ’s stock price has appreciated by 3.2% year-to-date, closing at $55.27 as at Monday. At this price, the stock trades at a price-to-book (P/B) ratio of 1.10x, which is lower than the Main Market Financial Sector’s average of 1.20x.

(Sources: JSE & NCBCM Research)

• United Oil and Gas (UOG) is intensifying its efforts to find partners for oil exploration off Jamaica’s south coast, promoting the Walton-Morant block as a “world-class frontier opportunity” with game-changing potential. In an interview, CEO Brian Larkin described the block as “one of the Caribbean’s last great untapped oil plays,” suggesting it could rival the massive discoveries in Guyana and Namibia.
• However, Jamaica’s play sits in shallower waters of 50 to 2,000 metres, making the project less costly and more appealing under environmental, social, and governance (ESG) standards. As such, the company is seeking approximately US$50 million to drill its first well and is currently sharing data with “household name” companies, ranging from regional players to oil majors.
• UOG received a two-year license extension in early 2024, giving it until January 2028 to drill. In May, it applied for permission from Jamaica’s environmental agency (NEPA) to conduct piston core sampling — the final step before drilling. Of note, Jamaica drilled 11 oil wells between 1955 and 1982, none of which were commercially successful, though hydrocarbons were found. Larkin believes modern seismic data could change the outcome.
• The most promising near-term target is the Colibri prospect in the Walton Basin, estimated to hold 400 million barrels. Gaffney Cline gave it a 19% geologic chance of success, potentially rising to 33% with piston core results. Even bigger prospects lie in the less explored Morant Basin, with targets like Thunderball (600 million barrels), Moonraker, and Blofeld — all part of UOG’s James Bond-themed naming.
• UOG holds 100% of the license but is open to a farm-out deal where equity would be shared. “There’s potential that we would retain operatorship, or that an importer would want to take the operatorship. That’s all still to play for,” Larkin said. With technical partners already lined up and permitting advanced, the company says it’s ready to move fast.
• With just over two years left before drilling must begin, the pace of partnership development could shape Jamaica’s future as a potential oil-producing nation.

(Source: Caribbean National Weekly)

• Amid mounting global tensions and rising concerns over supply chain disruptions, the Government of Antigua and Barbuda has announced its intention to acquire a cargo aircraft to strengthen food security and safeguard critical imports.
• Speaking on the matter, Director General of Communications in the Office of the Prime Minister, Maurice Merchant, said the move is in direct response to international developments, including the ongoing war in Ukraine and other global hotspots, which have been affecting shipping and trade flows, particularly those originating from North America.
• “That was why the Cabinet decided to focus its attention on South America,” he explained. Merchant noted that many of the food items found on supermarket shelves in Antigua and Barbuda already come from South American countries, including Brazil and the Dominican Republic.
• The new cargo aircraft would, therefore, enhance the country’s ease of access to these markets by improving logistics and shipping efficiency. “The Ministry of Foreign Affairs, the Cabinet of Antigua and Barbuda, will be examining closely what has been happening in North America, in the U.S. in particular, and will devise programs to ensure that Antiguans and Barbudans are not impacted severely.”
• While no specific model or type of aircraft has been confirmed, the Cabinet is in the early stages of planning for the acquisition, funding, and operation of the aircraft. There is also no set timeline for when the aircraft will be procured.

(Source: Antigua Observer)

• Economic growth in the Cayman Islands is set to accelerate slightly in 2025 to 2.5% up from 2.2% in 2024 but will remain slower than the 2014-2023 average of 5.0%, according to Fitch Solutions. The current real GDP growth outlook, though close to the government’s forecast of 2.6%, is slightly below Fitch’s previous 2.9% forecast due to the anticipated negative impact of a United States (U.S.) economic slowdown on tourism arrivals in the Cayman Islands.
• Rising U.S. import tariffs are anticipated to negatively impact economic growth in the Cayman Islands. Around 80.0% of Cayman's goods exports were sent to the U.S. in 2023, and sales will suffer from reduced competitiveness in the U.S. market, given the 10.0% baseline tariffs.
• However, the Cayman Islands' economy is predominantly service-oriented, with financial services and tourism being the primary contributors to GDP. Consequently, the small absolute size of Cayman’s exports (US$45.3Mn or less than 1.0% of GDP in 2023) will limit the impact of a goods export downturn on the wider economy. Instead, the negative impact of US trade tariffs will primarily be felt through two channels, namely the cost of imports and the negative implications for Cayman’s tourism sector. Faster U.S. inflation will result in a higher cost of importing U.S. goods into the Cayman Islands, given the high dependence on imports to meet domestic demand.
• Rising U.S. import tariffs will increase U.S. inflation, particularly for goods subject to the highest tariffs, such as steel and aluminium. This will raise import costs for Cayman businesses, pushing up prices for construction materials, food and household goods. As such, Fitch forecasts inflation in the Cayman Islands to average 3.5% in 2025, faster than 2.5% in 2024, slightly reducing real household purchasing power.
• Moreover, U.S. import tariffs will likely contribute to an economic slowdown in the U.S., with negative implications for Cayman’s tourism sector, which accounts for 35% of the country’s GDP and 40% of employment. Real GDP growth in the U.S., which typically accounts for four-fifths of tourism arrivals, is expected to weaken from 2.8% in 2024 to 1.5% in 2025, the slowest since the outbreak of the COVID-19 pandemic in 2020.
• The Cayman tourism sector started 2025 on a strong footing, with stayover arrivals increasing by 5.3% year over year (YoY) in the first quarter. However, the pace of growth will slow as U.S. consumers restrict discretionary spending on travel. Notwithstanding, weakness in tourism arrivals growth will be mitigated by factors including increased airlift capacity between the U.S. and Cayman, the Grand Hyatt’s 382-room opening, and the Owen Roberts International Airport expansion.

(Source: Fitch Connect)

• The Bank of Canada held its key benchmark rate at 2.75% last Wednesday, citing the need to probe the effects of U.S. trade policy, while cautioning that another cut might be necessary if the economy weakened in the face of tariffs.
• The decision marks the second time in a row that the central bank has remained on the sidelines after an aggressive cutting cycle which shrunk rates by 225 basis points over nine months.
• "The trade conflict initiated by the United States remains the biggest headwind facing the Canadian economy," Governor Tiff Macklem told a news conference, describing U.S. trade policy as highly unpredictable. "There was a clear consensus to hold policy unchanged as we gain more information," he said.
• U.S. President Donald Trump last Wednesday doubled the tariff on imports of Canadian steel and aluminum to 50%. The bank says it is weighing upward pressure on inflation from higher prices and downward pressure from sluggish growth.
• Before the next BoC decision in July, there will be two more months of inflation data and one GDP data. "On balance, members thought there could be a need for a reduction in the policy rate if the economy weakens in the face of continued U.S. tariffs and uncertainty, and cost pressures on inflation are contained," Governor Macklem said, in his opening remarks.
• Economists are expecting there could be between two and three more cuts this year and the final rate by the end year would likely end around 2%. "July looks more promising for a quarter point ease if, as we expect, the jobless rate continues to move higher, and inflation in items not subject to tariff pressures eases off a bit," said Avery Shenfeld, managing director and chief economist at CIBC in a note.

(Source: Reuters)