• Elite Diagnostic Limited recorded a net profit of $6.09Mn for the quarter that ended March 31, 2023. This represents a 78.4% yoy decrease in profitability. Furthermore, for the nine months ended March 2023, net profit tumbled to $4.56Mn from $34.89Mn in 2022. Despite the higher revenues, profit declined because of increased expenses over the period under review. 
• Revenue for the quarter was up by 25.6% yoy to $202.21Mn. This was driven by revenue-generating machines being back in service, allowing them to increase work hours to clear the backlogs. Similarly, revenue for the nine months increased by 25.9% yoy to $565.76Mn
• Direct costs for the quarter and the nine months ending March 2023 were up 54.7% to $66.7Mn and 24.9% to $175.19Mn, respectively. This was due to the additional maintenance repair cost that was incurred for some machines that were out of operation since Q2.
• Administrative expenses were up 29.4% yoy to $77.92Mn for the quarter, while for the nine months, it was up 35.6%, owing to higher operating expenses from the extended shifts to clear backlogs.
• Additionally, depreciation was up 87.4% to $40.18Mn and 53.3% to $116.76Mn for the quarter and the nine months respectively.
• Elite’s stock price has decreased by 30.2% since the start of the calendar year. The stock closed Wednesday’s trading session at $2.20 and currently trades at a P/E of 44.0x which is above the Junior Market Health Sector Average of 15.7x.
• Going forward the company highlighted that it will implement a different strategy to ensure that the machines are brought back into service more quickly to minimize the reduction in projected daily revenues. Additionally, the installation of solar equipment at its Liguanea branch and subsequently at its Drax Hall branch is being coordinated to reduce its operating expenses in coming quarters.

(Source: JSE)

• The Bank of Jamaica has reported that overall credit conditions tightened during the March 2023 quarter relative to the previous quarter.
• Responses to the central bank's Quarterly Credit Conditions Survey showed consumers were experiencing higher interest rates and more stringent credit terms. This indicates the pass-through effect of early tightening regimes by the BOJ.
• The Bank's data also showed that the flow of new loans to the private sector declined by 12.7% in real terms as at April 2023.
• The BOJ expects this reality to further push down inflation in the coming months.
• The central bank says credit terms are expected to again tighten for the June 2023 and September 2023 quarters given responses from the survey. However, a marginal deceleration in the pace of tightening is expected towards the end of the year.

(Sources: RJR News and BOJ)

• Mexico brought in close to $5.7Bn in remittances in May, central bank data showed, breaking a monthly record that analysts cautioned was softened by the recent strength of the peso versus the dollar.
• While Mexico records remittances in dollars, as most of the funds come from the United States, "a strong peso hurts remittances," said Goldman Sachs analyst Alberto Ramos.
• Mexico's "super peso" is among the top-performing currencies this year, appreciating more than 13% against the U.S. dollar from May 2022 to May 2023. With a stronger local currency, recipients of funds from abroad receive fewer pesos when they sell the dollars they were sent.
• Given the peso's appreciation against the dollar, when measured in local currency, remittances declined 2.2% year-on-year, Ramos said.
• Nonetheless, Mexican President Andres Manuel Lopez Obrador has touted the economic boost remittances, which largely come from the United States, have brought to the country.
• Last year, remittances to Mexico from abroad hit a record high of $58.5Bn, making Mexico the second highest remittance-receiving country, just behind India.
• Despite the blow from the "super peso," the dollar amount of remittances sent in May rose almost 11% year-on-year.

(Source: Reuters)

• Fitch Solutions has revised its Short-Term Political Risk Index (STPRI) score for Guyana from 57.4 to 59.9 out of 100.
• The revision is based on both softening price growth and the successful completion of the local government elections (held on June 12, 2023), which bode well for the ‘policy continuity’ and ‘social stability’ components of the index.
• The successful completion of the local government elections and falling inflation suggest a broadly improving political environment in Guyana.
• Granted, the local government elections are far less consequential compared to the presidential elections. Nevertheless, the elections took place in an orderly fashion and, unlike the March 2020 snap general elections, the results were not disputed and protests did not emerge, boosting confidence in the market’s democratic processes.
• Additionally, the latest monthly data shows inflation decelerating to 3.3% y-o-y in April and 3.0% in May, down from 6.4% in January due to falling food prices. This, coupled with the government’s expansionary 2023 budget will improve household purchasing power, which in turn will bode well for social stability.
• Despite the upward revision to the STPRI score, Guyana’s score is still somewhat low in part due to a poor security environment and persistent ethnic tensions.

(Source: Fitch Solutions)

• The U.K. is the only country among the Group of Seven wealthy nations where inflation is still rising, according to data from the Organization for Economic Cooperation and Development. The Paris-based organization said Tuesday that year-on-year inflation in the G7 fell to 4.6% in May, down from 5.4% in April, reaching its lowest level since Sept. 2021.
• The downward trend was observed across most advanced economies in May, with annualized inflation trending lower in the U.S. Canada, France, Germany, Italy and Japan. Britain, however, was found to be an outlier.
• U.K. consumer prices across all items rose to 7.9% in May when compared to the previous year, the OECD said, up slightly from 7.8% in April.
• Last month, the Bank of England hiked interest rates by 50 basis points to 5%, a larger increase than many expected. The BOE’s 13th consecutive rate rise takes the base rate to the highest level since 2008.
• The move, which exacerbated fears of a mortgage catastrophe, marked a divergence from other major central banks that have been able to either slow or pause interest rate hikes. The OECD in early June forecasted that the U.K. will post annual headline inflation of 6.9% this year, the highest level among all advanced economies.

(Source: CNBC)

• Major industry players at the Energy Asia conference held in Kuala Lumpur this week stated that oil and gas will continue to be leading sources of energy for decades to come on the back of a lagging energy transition.
• “Energy transition is going to take a lot longer, it’s going to cost a lot more money and need new technologies that don’t even exist today,” said John Hess, CEO of U.S. oil company Hess Corporation. “When it comes to clean energy, the world needs to invest $4 trillion a year — and it’s nowhere close,” Hess continued.
• “Liquids are projected to remain the world’s leading energy source in 2050, even as demand growth slows beyond 2025,” Erin McGrath, ExxonMobil’s public and government affairs senior advisor, told CNBC.
• “Overall, demand for liquids is expected to rise by about 15 million barrels per day by 2050. Almost all the growth will come from the emerging markets of Asia, Africa, the Middle East and Latin America.”          
• In an e-mail exchange Tuesday, the largest U.S. oil producer ExxonMobil reiterated the same sentiment on oil demand. The company expects oil to remain the largest primary source of energy for at least two more decades given its vital place in the commercial transportation and chemical industry.

(Source: CNBC)

• Total value added at constant prices for the Jamaican economy increased by 4.2 per cent in the first quarter of 2023 when compared to the first quarter of 2022. This was attributed to growth in the Services and Goods Producing Industries of 5.4 per cent and 1.0 per cent, respectively. The performance of the economy reflected the sustained recovery from the impact of the COVID-19 pandemic. This outturn was significantly higher than the 2.7% preliminary estimate put forward by the PIOJ.
• The increase in the Services Industries was due to improved performance in all industries, except for the Producers of Government Services which declined by 0.3 per cent. Growth was recorded for Hotels & Restaurants (29.7 per cent), Other Services (13.0 per cent), Transport, Storage & Communication (7.1 per cent), Wholesale & Retail Trade; Repairs; Installation of Machinery & Equipment (2.8 per cent), Real Estate, Renting & Business Activities (2.3 per cent), Finance & Insurance Services (1.9 per cent) and Electricity & Water Supply (0.7 per cent). The performance of the Hotels & Restaurants industry was positively impacted by a 45.5 per cent growth in foreign national arrivals to the island.
• Within the Goods Producing Industries, higher output levels were recorded for Mining & Quarrying (114.7 per cent) and Manufacturing (3.6 per cent). However, there were declines in Agriculture, Forestry & Fishing and Construction of 6.9 per cent and 4.2 per cent, respectively. The growth in the Mining & Quarrying industry was due to increased output from the JAMALCO plant which was closed in the comparable period of 2022.
• When compared to the fourth quarter of 2022, the total value added for the economy grew by 1.0 per cent. This was the result of a 1.5 per cent increase in the Services Industries and a 0.6 per cent fall in the Goods Producing Industries. The economy grew by 4.7 per cent for the fiscal year 2022/2023 compared to fiscal year 2021/2022.
• Meanwhile, the PIOJ estimates that the economy will grow within the range of 2.0 per cent to 3.0 per cent for the June 2023 quarter relative to the June 2022 quarter. The growth projection for FY2023/24 is within the range of 1.0 per cent to 3.0 per cent. All industries are projected to record growth, albeit at slower rates, as base effects wane.
• The downside risk to the projections include increased factory downtime, particularly in Mining and Quarrying industries, weather-related shocks that could affect agriculture, an intensification of geopolitical conflicts leading to a deterioration of supply side conditions and a lower than anticipated external demand for Jamaican goods and services as a result of slower than expected growth in the economies of Jamaica’s main trading partners.

(Source: STATIN)

• The United Kingdom (UK) business community is being encouraged to look to Jamaica for business opportunities. State Minister in the Ministry of Foreign Affairs and Foreign Trade, Hon. Alando Terrelonge, who met with business interests at the Jamaican High Commission in London recently, has indicated to the UK business community that the country is open for trade and investment.
• Touting the advantages, he said that “Jamaica enjoys a globally competitive business market, strong commercial laws, world-recognized ease of doing business, and Jamaica is more than sand and sea. Jamaica is a key destination for business, trade, and investment, with many benefits of doing business in a modern democratic nation with great political and economic stability.”
• He underscored that Jamaica has one of the best-performing stock markets in the world (rated the best by Bloomberg in 2015 and 2018), a highly profitable real estate market, sound macroeconomic policies, impressive vocational programmes to upskill employees, and has enjoyed successive quarters of economic growth.
• The State Minister noted further that the World Bank and the International Monetary Fund (IMF), have all given Jamaica positive ratings for its economic management, adding that the country has also received a B+ rating from global credit rating agency Fitch.
• Given these attractive conditions for investments, investors from the UK business community can take advantage of these opportunities that may drive positive yield on investments. Subsequently, Jamaica will benefit, as increased investments provide employment and increase domestic consumption, thus resulting in a win for both parties.

(Source: JIS News)

• The Government of Barbados recently announced an integrated package of innovative initiatives to accelerate its transition to net zero, boost resilience, enfranchise workers, and draw in private sector investment while prudently managing public debt levels.
• This package of initiatives reflects unprecedented cooperation and a new "system approach" between the Government, its Resilience and Sustainability Facility (RSF) at the International Monetary Fund (IMF) and Barbados' long-standing financing partners; Inter-American Development Bank (IDB), World Bank Group (WBG), Development Bank of Latin America and the Caribbean (CAF), European Investment Bank (EIB), and Green Climate Fund (GCF). 
• Particularly, in a first of its kind, the Government of Barbados has decided to use US$10Mn from the fiscal space created by the RSF as capital for a new Blue Green Bank.
• A green bank is a type of bank that is determined to use its resources of finances to help transition to more sustainable concepts, such as the use of renewable energy; and fight against climate change as a whole.
• Once established, the Blue Green Bank will help finance over US$250Mn of green investments in affordable homes, hurricane-resilient roofs, the electrification of public and private transport, and other Paris-aligned investments.
• Additionally, low-cost and long-term financing instruments from the EIB, CAF, IDB, GCF and RSF will support Government investment in resilient water and waste treatment infrastructure, and flood and coastal protection.
• Together, these initiatives will help Barbados meet its resilience objectives and protect its citizens, whilst helping transform the economy and protect its pristine natural environment.

(Source: International Monetary Fund)

• Indicators monitored by the Central Bank of Trinidad and Tobago show signs of a slow and steady recovery of the domestic economy in the first quarter of 2023, the latest Monetary Policy Announcement stated.
• Domestic inflation trended downward over the first five months of 2023. Headline inflation slowed to 5.7% in May 2023, compared with 6.0% one month prior and 8.7% in December 2022.
• Declining international food prices in tandem with easing local produce prices resulted in a decline in food inflation to 9.7% in May 2023, from 11.2% in April 2023 and 17.3% in December 2022.
• Core inflation, which excludes food prices, remained unchanged at 4.8% in May 2023 from the previous month but lower than the 6.7% recorded in December 2022. The outlook is for continued moderation in headline inflation, although adverse weather could lead to some spikes in local food crop prices.
• Additionally, there is some early evidence of improving labour market conditions based on observed increases in labour force participation in the third quarter of 2022 and the decline in the number of persons retrenched during the second half of 2022. The outlook for 2023, therefore, continues to look favourable, barring major external shocks.

(Sources: Central Bank of Trinidad and Tobago & Trinidad Express Newspapers)