• After several consecutive quarters of decline, MailPac reported a 66.1% increase in Q3 net profit to $114.00Mn compared to $68.62Mn in the prior year. Despite the robust third-quarter recovery, Mailpac recorded a 10.1% ($20.52Mn) year-over-year (YoY) decline in earnings to $182.67Mn for the nine months ended September 30, 2024.
• At the end of Q3 2024, revenue totalled $732.03Mn, an 82.9% increase from the prior year. The strategic integration of MyCart Express, acquired in March 2024, as well as the continued performance of its core brands, were the primary drivers of the brisk topline growth.
• Further, operating expenses for the quarter surged to $224.15Mn (91.9%), reflecting higher operating costs with the amalgamation of MyCart Express, along with growth in operating expenses from its existing business.  Higher airline freight charges, system upgrades and restructuring initiatives, aimed at harmonizing the brands, were among the contributors to the increase in expenses.
• The acquisition of MyCart Express has positioned MailPac as the largest courier platform in the Caribbean, now delivering over 1.5Mn packages annually. Consequently, the company has been focusing on technological improvements to drive cost efficiencies and innovation. As these strategies continue to unfold, MailPac anticipates significant synergistic benefits, operational efficiencies, and enhanced revenue.
• MailPac’s stock price has increased by 10.5% since the start of the calendar year, closing Wednesday’s trading session at $2.42. At this price, the stock trades at a P/E of 26.89x, above the Junior Market Distribution Sector Average of 19.95x.

(Source: NCBCM Financial Research & FESCO Financial Statements)

• In recent years, Jamaica has focused on increasing the number and scope of Special Economic Zones (SEZs) to enhance economic growth, attract foreign investments and boost exports. This development has been part of the country’s broader Global Logistics Hub Initiative, which aims to position Jamaica as a critical player in international trade.
• Since the replacement of the Free Zones Act with the Special Economic Zones Act in 2016, there has been a steady rise in the number of approved SEZs across Jamaica, resulting in the current total of 198 locations. This strategic development has strengthened Jamaica’s logistics cluster and puts the country in a better position to become the fourth global logistics node¹.
• The Jamaica Special Economic Zone Authority (JSEZA) plays a pivotal role in SEZ development, regulation and management, and has a mandate to establish the island as a hub for world-class facilities and services.
• Recognising the importance of workforce development in achieving this goal, JSEZA’s CEO Kelli-Dawn Hamilton pointed out that the entity has partnered with key institutions, like HEART/NSTA Trust and the Caribbean Maritime University (CMU), to build a talent pipeline aligned with emerging opportunities.
• Additionally, JSEZA has amplified its advocacy efforts, championing policies that ensure competitiveness and economic viability for SEZ clients. “We see the SEZs as a testing ground for the broader economy. If a solution works within the SEZ, we are confident it can benefit the wider economy,” Mrs. Hamilton stated.

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¹A centralized geographical location that brings together the key business operators in logistics, e.g. manufacturers, shipping lines, air cargo companies, third- and fourth-party logistics providers (e.g. express cargo service providers), and logistics support services.

(Source: JIS)

• The value of goods exports from Latin America and the Caribbean (LAC) have increased by 3.2% year-on-year in the first half of 2024, after recording a 1.6% decline last year according to the Inter-American Development Bank (IDB).
• In its latest report, the IDB noted that this improvement was the result of an increase in export volumes and the stabilisation of prices relative to 2023. The recovery in goods exports was fueled mainly by extra-regional demand, while trade with partners within the region continued to decline.
• Despite the improvement in goods exports, the most recent indicators do not yet confirm a sustained recovery in the region's overall exports according to the report. Notably, service exports slowed slightly in the first quarter of 2024, growing at 9.5% compared to the average of 12.2% last year. Nevertheless, this growth remains well above the global average of 7.1%.
• For the Caribbean, exports are estimated to have recovered significantly in the first half of 2024 (20.0%), after declining in the average for 2023 (-13.7%). This growth, however, was driven almost entirely by Guyana, as preliminary data for the Bahamas, Barbados, Belize, Jamaica, and Trinidad and Tobago point to a decline in export performance.
• Looking ahead, the external environment still holds significant uncertainty and downside risks, mainly due to geopolitical tensions, industrial policies, rising protectionist measures, and the impact of climate change.

(Source: IDB & Trinidad Express Newspaper)

• The Government of Bahamas has beaten its debt buyback target by agreeing to repurchase almost $216Mn in Bahamian foreign currency bonds that were listed and traded on major international stock exchanges.
• The total to be acquired, using financing from a $300Mn loan provided by Standard Chartered Bank, slightly exceeds the original $210Mn goal and was disclosed in a statement issued on the Government’s behalf before global markets closed on Friday, November 15, 2024.
• The release revealed that the Government received $445.817Mn worth of offers from investors to sell their holdings of Bahamian sovereign bonds spread across six different issues with principal maturity dates ranging from 2028 to 2038.
• The $215.69Mn to be repurchased means that the Davis administration accepted just under half, or 48.3%, of investor offers. The combined value of the offers accepted by the Government following the transaction’s closing represents just 8.8% of the combined $2.43Bn in principal covered by the outstanding bond issues.
• The rationale for the debt buyback has yet to be fully disclosed. However, the Government is likely to be exchanging higher-cost bonds for a Standard Chartered loan carrying a lower interest rate, later maturity date and more favourable terms. Furthermore, the interest savings generated from this buyback should finance a conservation trust fund set up by the Government to help safeguard the marine environment. The transaction thus has some characteristics of a debt-for-nature swap.
• The Bahamas is also understood to be working on a similar transaction, possibly worth up to $500Mn, with the Inter-American Development Bank (IDB) - a deal that the latter’s president recently confirmed is being worked on in an interview with international media.
• Securing the $500Mn IDB loan would allow the Bahamas to refinance an additional 22.6% of outstanding debt at a more favourable rate. This would mean lower debt servicing costs, unlocking more funds for investments in domestic projects and reducing the sovereign’s fiscal deficit.

(Sources: The Tribune & NCBCM Research)

• Canada's annual inflation rate accelerated more than expected to 2.0% in October as gas prices fell less than the previous month, data showed on Tuesday, likely diluting chances of another large rate cut in December.
• Prices for goods rose 0.1% on a year-over-year basis in October, following a 1.0% decline in September. In contrast, prices for services decelerated in October, rising 3.6%, the smallest yearly increase since January 2022. Over the past three years, prices for goods rose 10.2%, while prices for services increased 14.2%.
• Karl Schamotta, Chief Market Strategist at Corpay, believes the Bank of Canada will likely opt for a smaller quarter-point increase in December. He expects signs of economic resilience to support policy expectations into 2025. However, underlying price pressures are continuing to ease. If the upcoming GDP release on November 29 and the jobs report on December 6 show softer results than today's report, policymakers may take more aggressive action to reduce the gap between current rates and the neutral rate^[1]. This gap is estimated to be between 2.75% and 3.25%.

Source: (Reuters & Statistics Canada)

• Britons started new businesses last year at the slowest rate since 2010, a potential warning sign for longer-term economic growth and productivity, according to official data published on Monday.
• The number of new businesses started in the United Kingdom fell to 316,000 in 2023 from 337,000 in 2022, according to the Office for National Statistics.
• This reduced the 'business birth rate' - the number of new businesses started as a percentage of the total number trading, from 11.5% to 11.0%, the lowest since 2010. Fewer businesses closed too, with 309,000 shutting their doors in 2023, down from 349,000 in 2022, lowering the 'business death rate' to 10.8% from 11.9%, the lowest since 2020.
• Many economists view falling rates of business creation and destruction as bad for productivity growth and long-term improvements in living standards, as older businesses often find it harder to adopt better business models or new technology.

(Source: Reuters)

• Consumer prices fell to a 3-year low in October, according to data from STATIN. The point-to-point inflation rate for October 2023 and October 2024 was 4.9%, the lowest since June 2021, when the reopening of economies caused a spike in global demand and supply chain challenges that led to a surge in prices for imported goods.
• October’s low inflation outturn primarily reflects lower prices in the ‘Housing, Water, Electricity, Gas and Other Fuels’ division (+3.5%), which was partially offset by higher costs for the ‘Food and Non-Alcoholic Beverages’ (+5.3%) and ‘Transport’ (+9.1%) divisions.
• Growth in the ‘Housing, Water, Electricity, Gas and Other Fuels’ division was due mainly to increases in the prices of ‘Imputed Rentals for Housing’ (+6.2%) and ‘Water Supply and Miscellaneous Services Relating to the Dwelling’ (+7.8%) spurred by higher rental prices and water and sewage rates.
• The ‘Food and Non-Alcoholic Beverages’ division continued to be impacted by higher prices in the ‘Fruits and Nuts’ (+17.5%) and ‘Vegetables, tubers, plantains, cooking bananas and pulses’ (+5.7%), due to the lingering effects of Hurricane Beryl and the recent heavy rains on the supply of some produce.
• Higher prices in the Transport division were driven by a 15.4% increase in the ‘Passenger Transport Services’ class, resulting from a 19% rise in taxi fares in October 2023, and the fare restructuring by the Jamaica Urban Transit Company effected May 2024.
• At 4.9%, Jamaica’s inflation is comfortably within the BOJ’s target range of 4.0%-6.0%. With the path for inflation over the next eight quarters likely to be lower, it could set the stage for another rate cut at the next meeting of the Monetary Policy Committee on November 21. Currently, the policy rate stands at 6.50% after 2 consecutive 25 basis points cuts, which is significantly higher than the 0.5% rate in June 2021.
• Still, the US Federal Reserve’s (US Fed’s) interest rate pathway may be a constraint on the magnitude of future BOJ rate cuts, as Jamaica’s central bank walks the interest rate differential tightrope to help moderate inflation. Projections for the US Fed's 2025 rate cut trajectory have moderated due to the potential impacts of a Trump presidency. Proposed policies such as corporate tax cuts, deregulation, broad tariffs, and mass deportations could stimulate US inflation. This, in turn, could drive up Jamaica's imported inflation, complicating the Bank of Jamaica's (BOJ) short-term policy rate projections.

(Source: STATIN)

• Fuel distributor FESCO reported a 68.4% increase in its September 2024 (Q2 2025¹)  earnings, reflecting the impact of its downward revision to its Q2 2024 results and revenue growth outpacing costs.
• FESCO’s Q2 2024 results were adjusted to align with the audited figures for the fiscal year ending March 31, 2024 (FY24). These adjustments included a 0.3% revision to sales and cost of goods sold (COGS). As a result, Q2 2024’s gross profit was revised down from $379.88Mn to $329.07Mn – a decrease of $50.81Mn – which impacted the company’s bottom line. As a result, net profits for Q2 2024 were revised down by 36.3% to $101.12Mn, setting a lower base for growth in Q2 2025.
• Additionally, Q2 2025 earnings growth was also supported by revenue growth outpacing costs. Buoyed by a 13.4% increase in the volume of fuels sold, including both traditional fuels and LPG, revenues increased by 10.1% year-over-year to J$7.93Bn. Direct costs rose by 8.7%, supporting a +38.3% increase in gross profit to J$455.1Mn.
• Operating expenses rose by 19.8% to J$251.5Mn, reflecting its expanded operations, additional retail locations², and increased business acquisition and development costs. Finance costs (net) were also higher because of higher interest on debt and bonds, net of interest income and foreign exchange gains. Staff costs increased to J$95.5Mn, up J$25.7Mn year over year, due to an expanded workforce required for new retail locations and operational growth.
• Looking ahead, the Company has commenced construction of its service station on Spanish Town Road, FESCO Oval. FESCO Oval will be a company-owned company-operated service station and will increase its retail presence within the Kingston and St Andrew (KSA) region. It is slated to open in September 2025.
• YTD, Fesco’s shares are down 4.06%; however, following the release of Q2 earnings, the company’s share price increased marginally to $3.67 (+0.5%). At $3.67, the stock trades at a P/E of 22.82x, which is above the Junior Market Distribution Sector Average of 19.90x.

(Source: NCBCM Research & FESCO Financial Statements)

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¹ FESCO’s year end is March 2025

² Operating locations including the additions of: FESCO Kitson Town, FESCO Hayes, FESGAS Bernard Lodge and FESGAS Naggo Head

• LIAT (2020) Ltd has announced the launch of its inaugural flight to Georgetown, Guyana (GEO) on November 19, 2024. This new Antigua-Guyana route will offer increased connectivity across the region, strengthening ties between the Eastern Caribbean and South America.
• According to a press release by LIAT (2020), the introduction of the new route marks a significant milestone in the airline’s expansion strategy, offering a crucial link between the Caribbean and Guyana’s emerging markets. The LIAT expansion also offers even greater opportunities for travellers from regions such as Canada, Europe, and the Middle East to reach Guyana through the Caribbean.
• Georgetown, Guyana’s capital and economic hub, is a key destination for business and leisure travellers alike.
• Oneidge Walrond, Minister of Tourism, Industry, and Commerce for Guyana, explained that the increased airlift, coupled with the government’s investments in airport infrastructure, will unlock new opportunities for economic growth and development.
• Furthermore, operating with an enhanced fleet of aircraft, LIAT20 continues to be a key driver of economic development and regional integration.

(Source: Guyana Chronicle)

• As was widely anticipated, the Bank of Mexico’s (Banxico’s) Board of Governors voted in a unanimous decision to reduce the overnight rate by 25bps to 10.25%, bringing the cumulative amount of loosening since the cutting cycle began in April to 100bps.
• In its statement, the Banxico Board noted recent peso weakness following Donald Trump’s election victory but also commented that this weakness has been reasonably contained relative to prior episodes and that financial market volatility more generally has subsided.
• Policymakers saw little downside risk from pushing ahead with their cutting cycle, particularly considering easing core inflation pressures that are a function of softness in economic activity.
• Expectations are for another 25bps cut in December, with the overnight rate to be lowered to 8.00% (up from previous forecasts of 7.50%) by end-2025 in response to officials’ concerns about weakness in economic activity that will likely outweigh fears about the inflationary impact of peso depreciation linked to Donald Trump’s return to the White House.
• Risks to the forecasts are tilted to the upside, though there is a case to be made for Banxico to facilitate FX depreciation if Trump pushes ahead with tariff plans, given its role as a shock absorber.

(Source: BMI)