• Tropical Battery completed a sale-leaseback of its Ferry Road headquarters, converting an illiquid real estate asset into J$950Mn in gross proceeds without disrupting daily business operations.
• The proceeds were used to pay down higher-cost debt facilities, lowering the company's annualised interest burden, and to strengthen working capital for inventory and distribution network operations.
• The transaction is not a straightforward debt elimination; under IFRS 16 rules, the company will replace its mortgage debt with a newly recognised right-of-use asset and a corresponding lease liability on its balance sheet.
• This move is part of a coordinated, multi-year strategy to reduce the heavy debt load from recent rapid acquisitions, sitting alongside other initiatives like financing for Tropical Renewable Energy and negotiations with institutional lenders.
• Management emphasised that the transaction replaces a low-yield owned asset with deployable cash, betting that the capital reinvested into the core business will generate returns that exceed the new lease obligations.
• Reducing debt lowers interest expenses, allowing a greater share of operating profit to flow directly to net earnings. An expansion of net earnings should strengthen the company's financial foundation, freeing up capital for reinvestment and, ultimately, supporting future dividend payments.
• Prior to the sale-leaseback, Tropical achieved a 124.4% turnaround in its first-half earnings, reaching $24.42M for March 2026. This growth was driven by a 3.1% increase in revenue alongside gross margin expansion to 38.4%, fueled by a stronger sales mix of high-margin products.
• Since the start of the year, Tropical’s stock price has declined by 11.9% to $1.40 on Thursday, June 18, 2026. At this level, the stock trades at a price-to-earnings (P/E) ratio of 11.1x, which is below the Main Market Energy, Industrials and Materials Sector average of 13.0x.

(Sources: JSE& NCBCM research)

• Industry Minister Senator Aubyn Hill announced that complaints from the construction sector regarding cement shortages are declining as market conditions continue to stabilise. Speaking at a post-Cabinet media briefing on Wednesday, Senator Hill explained that the Cabinet analysed the compounding annual growth rate to project future cement demand and consequently approved additional importers to ensure a steady market supply and foster healthy competition.
• While Buying House Company was previously approved in April to meet immediate demands following operational disruptions at Caribbean Cement Company Limited (CCC), three or four other importers have now been approved to bring in varying quantities of cement.
• Jamaica Logistics International Limited was approved to import 100,000 tonnes, Rock Hard 100,000 tonnes, Tank-Weld Metals 60,000 tonnes, Island Concrete Company Limited 60,000 tonnes, and Gore Developments Limited was approved to import 20,000 tonnes, totalling 490,000 tonnes. This short-term, six-month import injection eclipses the entire incremental capacity of CCC's recent Rockfort kiln expansion, which was designed to add 300,000 tonnes of annual output to push total capacity to 1,300,000 tonnes.
• Senator Hill asserted that the supply and demand equilibrium is returning to normalcy, noting that the CCC has increased its imports while the newly approved importers finalise their arrangements to meet local construction needs.
• The shortage was triggered by heavy rainfall and raw material issues that impacted production at CCC’s Rockfort plant. It was further compounded by the high demand for infrastructure projects in the aftermath of Hurricane Melissa.

(Sources: CEMNET & NCBCM Research)

• Trinidad and Tobago's (T&T’s) mid-year budget review and updated fiscal projections indicate that the government expects the fiscal balance to narrow in FY2026^[1] from -4.6% in FY2025 to -3.5% of Gross Domestic Product (GDP). On June 15, T&T’s Minister of Finance Davendranath Tancoo presented the government's mid-year budget review, outlining updated fiscal projections and providing details on the supplemental budget appropriation that was approved last week.
• In line with BMI’s long-standing view, Minister Tancoo revealed in his review that revenues exceeded projections (TTD30.1Bn relative to TTD28Bn) for the first seven months of the fiscal year, attributing this performance to a range of factors, including elevated oil prices and newly implemented tax measures such as levies on landlords, special consumption taxes, and electricity surcharges. In addition, the review outlined a supplemental budget allocation that increases expenditures for FY2026 from TTD59.2Bn to TTD62.2Bn, bringing the government's expenditure projection in line with expectations.
• BMI is upbeat about the near-term revenue performance, through both energy and non-energy channels. Expectations are that elevated global energy prices will support T&T’s revenue mobilisation and overall fiscal outlook through Q2 2026. Of course, a one-dollar increase in Brent crude is associated with roughly a 0.1 percentage point increase in central government revenues as a share of GDP.
• Furthermore, newly implemented revenue measures will meaningfully boost non-energy revenues by expanding the tax base and raising taxes on goods with inelastic demand, such as alcohol and tobacco. The government's budget also included measures to strengthen tax compliance and collection, which will boost revenues. Finally, with new gas fields expected to come online in the coming quarters, the related near- and medium-term boost in output will help support public finances.
• As a result, the government projects that the primary balance will shift to surplus in FY2027, a view BMI also shares, with the primary surplus projected to average 1.3% of GDP from 2027 to 2035. This, in turn, will see debt stabilise and recede over the longer term, falling to around 65% of GDP by 2035.
• That said, downside risks arise primarily from a more subdued growth picture and the risk of fiscal slippage. Slower-than-expected domestic and global growth would affect public finances directly through lower-than-projected revenues and indirectly through increased political pressure on the government to loosen fiscal policy to support the lacklustre domestic economy, which saw muted activity in the most recent GDP print from Q3 2025.
• While the recently signed deal between the U.S. and Iran has sent prices lower, renewed tensions could drive a more sustained increase in energy prices, which would likely see revenues overperform and support the fiscal path.

(Source: BMI, A Fitch Solutions Company)

^[1] T&T’s fiscal year extends from October to September in the following year.

• As an increasingly important oil producer and exporter in Latin America, Guyana is well-positioned to benefit from the higher oil price environment caused by the US-Iran conflict. Under BMI’s baseline scenario, its Oil & Gas team forecasts that global Brent will average US$88/barrel (bbl) in 2026 (previously US$78/bbl), up from US$69/bbl in 2025, which will provide a substantial boost to Guyana's oil export earnings and inflows into the country's Natural Resource Fund (NRF), which then feeds into government revenues.
• Risks to this forecast now lean to the downside as oil prices have fallen sharply since the US-Iran agreement on a framework peace deal that is set to be signed on June 19, but BMI still believes that the spillover effects from the conflict will be net positive for Guyana in the near-term given the outsized influence of oil exports on the economy (crude accounts for around 90% of total goods exports and 50% of government revenues in 2025).
• Higher oil export inflows into the NRF, which manages the distribution of Guyana's oil earnings, will also bolster the country's fiscal position, most likely from 2027. The budget deficit will widen modestly from 4.9% of Gross Domestic Product (GDP) in 2025 to 5.3% in 2026, as under current rules, NRF withdrawals are capped by earnings from the previous year (2025), when oil prices were lower.
• However, a high oil price environment will enable the government to increase withdrawals and expand its fiscal stimulus in 2027. Moreover, ExxonMobil recently indicated that higher global oil prices are accelerating its cost recovery in the Stabroek Block, and once completed, this would lead to Guyana receiving a greater share of future oil earnings (compared to the current 12.5%), potentially providing an additional boost to revenues from 2027.
• Consequently, BMI expects the budget deficit to narrow further over the medium term as the ramping up of oil output continues to sustain strong revenue growth. Guyana's crude production is expected to more than double from the estimated average of 732,000 barrels per day (b/d) in 2025 to 1,493,000b/d by 2030. This will support robust oil revenue growth over the coming years, assuming broadly stable global oil prices. If oil prices fall further than expected, expectations are for more moderate revenue growth due to NRF withdrawal limits, while growth would accelerate if prices rise higher than forecast - potentially caused by instability in the Middle East.

(Source: BMI, A Fitch Solutions Company)

• The Bank of England (BoE) kept interest rates on hold at 3.75% in June, as it has since the start of the U.S.-Iran war, judging that it would be premature to raise rates given the uncertainty around the strength of increased inflation pressures.
• The decision came shortly after U.S. President Donald Trump signed a deal with Iran to end the conflict, a development Governor Andrew Bailey said he was “very encouraged” by, although he cautioned that it would not prevent British inflation from rising further. The Monetary Policy Committee voted 7-2 to keep rates steady, in line with economists’ expectations in a Reuters poll.
• The BoE’s cautious approach contrasts with the European Central Bank and Bank of Japan, which both raised rates in the past week, as well as projections from the U.S. Federal Reserve after its first meeting under new chair Kevin Warsh, which showed policymakers expected rates to rise later this year. Following the decision, sterling weakened slightly against the dollar, extending losses after the Fed decision and falling to its lowest level since April 7, while markets continued to not fully price in a BoE rate hike until December.
• While the tentative U.S.-Iran truce promised to reopen the Strait of Hormuz and lower oil prices, which would benefit Britain given its heavy reliance on imported natural gas, Governor Bailey said it was too soon to declare the inflation threat over. He noted that higher energy prices over the past four months had already created inflationary pressure in the pipeline, meaning inflation could still rise even if geopolitical tensions ease.
• The BoE expects inflation to rise above 3.25% in the final quarter of this year, up from 2.8% in May, although this is below the 3.6%-3.7% increase it had projected in April under two of its three main scenarios. The central bank was also marginally more upbeat on growth, estimating that the economy is expanding at an underlying rate of 0.2% per quarter, up from 0.1% in its previous forecasts, despite a small fall in output in April.
• For most policymakers, a weaker labour market, including higher unemployment and slower wage growth than a year ago, reduced the risk that a short-term pick-up in inflation would create longer-term difficulties in returning inflation to target. However, J.P. Morgan pushed back its expected timing for a BoE rate hike to November from July, warning that the central bank could again be wrongfooted by inflation if growth headwinds prove weaker than expected.

(Source: Reuters)

• The International Energy Agency (IEA) is forecasting a significant oil supply surplus in 2027, as Middle East production recovers from the disruption caused by the closure of the Strait of Hormuz. Global supply is expected to outpace demand by more than 5 million barrels per day (bpd), marking a sharp shift from the current period of market tightness.
• According to the IEA’s June oil market report, global oil consumption is expected to reach 105.3 million bpd in 2027, representing a gain of 2 million bpd. However, output is projected to climb by roughly 8 million bpd to 110 million bpd, creating a sizeable surplus that could provide a “welcome respite” to the market.
• The IEA noted that the expected surplus could allow countries to replenish depleted inventories or build new strategic reserves, particularly as governments review their energy strategies and policies in response to the crisis. This follows a period in which inventories have been under severe pressure, with the Organisation for Economic Co-operation and Development (OECD) government inventories falling to their lowest level since December 1990.
• The forecast comes after an interim agreement between the U.S. and Iran, scheduled to be signed on June 19, 2026 in Switzerland, paved the way for the reopening of the Strait of Hormuz and the lifting of the U.S. naval blockade on Iranian oil. However, the IEA warned that operational and political hurdles, including the time needed to clear mines and disputes over transit rights, could slow the pace at which Middle East output returns.
• Before the 2027 surplus materialises, the market is expected to face further strain. Global supply is set to fall by 3.9 million bpd in 2026 to 102.4 million bpd, while observed inventories have been draining at an average of 3.8 million bpd since fighting broke out on February 28. In May alone, inventories recorded a single-month draw of 143 million barrels.
• Oil prices have also eased sharply from crisis levels, with North Sea Dated crude prices falling by more than $40 per barrel from May through mid-June to around $82 per barrel, while Brent futures traded around $79 per barrel. The decline suggests markets are beginning to price in the expected recovery in Middle East supply, although near-term inventory risks remain elevated.

(Source: Yahoo Finance)

• After the delayed release of its December 2025 results showed annual losses of US$2.34Mn, Dolphin Cove Limited (DCOVE) remained under pressure in Q1 2026, with earnings sinking 83.4% year-over-year to US$142.80K as revenues continued to tread water.
• Year-over-year (YoY) Q1 2026 revenues sank 37.6% to US$2.55Mn, as weaker tourist arrivals, delayed hotel reopenings, and reduced room inventory across key resort areas post-Melissa took their toll. These headwinds led to lower attendance at Dolphin Cove and Yaaman Adventure Park, weighing on topline performance.
• Cost of sales drifted lower alongside revenues, falling 48.4% to US$280.26K amid softer attendance levels across the company's attractions. Consequently, gross profits declined by 36.0% to US$2.27Mn, even though gross margins increased modestly to 89.0% from 86.7%.
• Operating expenses followed the softer flow of visitor traffic, albeit declining at a slower 12.5% to US$2.14Mn, mainly due to reduced selling expenses. Even with a decrease in the allowance for impairment losses on receivables, operating profits were still down 69.6% to US$0.33Mn and operating margins halved from 26.7% to 13.1%.
• While Dolphin Cove’s Q1 2026 profitability remains compressed following a slow post-disaster demand, the operational outlook for the remainder of the financial year points to improvement. Top-line rebound is expected to be catalysed by accelerating stopover arrivals from expanding Latin American airlift, paired with robust visitor conversion rates within the cruise segment. Furthermore, localised marketing initiatives and targeted direct-to-consumer campaigns are projected to sustain a resilient base of domestic patronage, shoring up volume ahead of seasonal peaks. However, the company remains exposed to uncertainties regarding the Chapter 11 proceedings involving its parent group and the ultimate recovery of related-party balances¹.
• DCOVE’s stock price has declined by 16.7% since the start of the year to close at $10.00 on Wednesday, June 17, 2026. At this level, the stock trades at a price-to-book (P/B) ratio of 0.9x, which is below the Junior Market Others Sector average of 1.7x.

_______________________

¹In FY2025, DCOVE recognised a US$2.82Mn non-cash impairment provision for related-party receivables, primarily from Dolphin Discovery affiliates, due to Chapter 11 bankruptcies by Controladora Dolphin and TDC Leisure Investments.

(Sources: JSE& NCBCM research)

• Tropical Battery Company Limited (TROPICAL) has appointed Omaro Hutchinson to its Senior Leadership Team as the Director of Artificial Intelligence, Analytics & Strategic Projects, effective June 2026.
• He is tasked with transforming Tropical Battery into a genuinely AI-native company across all five of its operating entities, spanning Jamaica, California, and the Dominican Republic, focusing on measurable operational outcomes rather than adopting technology for its own sake.
• His role encompasses seven distinct cross-border workstreams, including intelligent automation, data analytics, AI-assisted sales, digital infrastructure, and the formalised build-out of the Group's Power BI reporting architecture.
• The appointment is positioned as a capability-augmentation strategy rather than a cost-cutting measure, with management explicitly stating that no roles will be eliminated as a result of integrating these new AI frameworks.
• For Tropical, this means a concerted push to lower the cost of sales and administrative expenses through technology. If executed properly, the centralised AI framework acts as an operational multiplier, allowing the Group to scale its revenues internationally without a corresponding, linear spike in administrative and structural expenses.
• Tropical’s stock price has declined by 15.7% since the start of the year to close at $1.34 on Wednesday, June 17, 2026. At this level, the stock trades at a price-to-earnings (P/E) ratio of 10.61x, which is below the Main Market Energy, Industrials and Materials Sector average of 25.0x.

(Sources: JSE)

• Grenada will spend over US$2Mn this year to insure itself against hurricanes and other natural disasters, as the country strengthens its financial defences in a region where a single storm can erase years of economic gains. The payment renews coverage under the Caribbean Catastrophe Risk Insurance Facility (CCRIF), a regional risk pool designed to provide rapid payouts when hurricanes, earthquakes or extreme rainfall events cross predefined thresholds. The approach reflects a wider Caribbean shift toward “risk layering”, combining insurance, contingency credit and reserve funds to reduce fiscal shock after disasters.
• Permanent Secretary in the Ministry of Finance Mike Sylvester said the premium has risen from about US$1.8Mn last year, reflecting recent disaster activity in the Caribbean. “You will see that that premium has increased, and of course, that in itself is expected,” he said. “Years before we had (Hurricane) Beryl in Grenada in 2024, and we also had Melissa in Jamaica in 2025, so once there are events and claims and so on, the insurance usually goes up.” He said the cost is significant but unavoidable in a region repeatedly exposed to climate shocks.
• CCRIF is a parametric insurance mechanism that provides payouts when specific hazard conditions are met, allowing governments to access liquidity quickly after disasters. CCRIF currently provides coverage for tropical cyclones, earthquakes, excess rainfall, fisheries and selected utility risks.
• The value of that system is underscored in recent regional events. Following Hurricane Beryl, Grenada received a total of US$44.04Mn from CCRIF across 3 parametric insurance policies within 14 days. Jamaica also received about US$91.9Mn in CCRIF payouts following Hurricane Melissa in 2025, with funds released within 15 days. Together, the figures highlight both the speed and the limits of parametric insurance in small island economies, where liquidity can support recovery but cannot fully absorb the cost of major disasters.
• Forecasts point to a less active 2026 Atlantic hurricane season, Sylvester noted, but he cautioned that even a quieter outlook offers little comfort since “all you need is one major event to create serious problems for us.” Officials are also exploring whether disaster protection can extend further into the wider economy, particularly tourism and small businesses, which remain highly exposed to storm damage.

(Source: Now Grenada)

• The Venezuelan government has signed five contracts with Shell that will give the European supermajor rights to operate the giant Loran natural gas field. The agreements formalise Shell’s participation in Loran, a cross-border reservoir shared with Trinidad & Tobago (T&T) that is estimated to hold 7 trillion cubic feet (tcf) of natural gas, while also covering oilfield expansion and efforts to reduce gas flaring.
• “For the first time, the Hydrocarbons Law, which was recently reformulated and amended, is allowing us these forms of negotiations and flexible business agreements where we will also boost production, and where we can make better use of resources for the people of Venezuela,” said Venezuela’s interim president, Delcy Rodriguez.
• She emphasised the strategic step seeks to enhance the country’s energy capabilities through direct collaboration with key international players, thus ensuring concrete progress in the infrastructure needed for hydrocarbon extraction in the Loran field.
• In 2023, Venezuela and T&T reached a deal with Shell to produce and export gas from the Dragon field, which is estimated to contain 4.2 tcf of gas. Together, the Loran and Dragon projects are expected to help Venezuela launch offshore gas exports, initially through supplies to T&T for processing into LNG. In addition to Loran, Shell also agreed to a technical alliance to support procurement and output expansion at fields in Monagas North, and to a separate pact to buy equipment and parts to reduce gas flaring.
• The agreements move Shell to the top of Venezuelan state-owned energy company PDVSA’s (Petróleos de Venezuela, S.A.’s) list of partners for key oil projects. That said, UK supermajor BP p.l.c is also set to participate in the Loran gas field and in the neighbouring Cocuina-Manakin offshore gas project, according to separate deals with the Venezuelan government.
• Recently, PDVSA and Spanish energy group Repsol also signed a crude and gas agreement to boost output in northwestern Venezuela, which could add about 20,000 barrels per day (bpd) of light crude to the current average output of around 40,000 bpd. The agreement also includes plans to triple output from Venezuelan oil operations within three years.

(Sources: Upstream Online, The Energy Year & Reuters)