The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamas Waste’s chairman has hailed the company’s “best year in its 30-year history” after 2018 profits soared 18 percent year-over-year to $1.348m.

Peter Andrews, writing in the BSX-listed waste collection and services provider’s annual report, said all top-line, expenses and net income indicators moved in the right direction in a “non-remarkable year” where the company failed in its bid to take over the New Providence landfill’s management.

“2018 was the best year in the 30-year history of your company,” Mr Andrews told Bahamas Waste’s 1,500 shareholders. “For the year, the sales and services rendered increased by six percent as compared to the year 2017, in a non-remarkable year from a special project point of view.

“Our expenses, which includes cost of sales and direct expenses, and operating expenses, decreased by four percent and our net income was up by 18 percent. Earnings per share were the highest ever ($0.34) as were the dividends ($0.24). All in all a very good year.”

Mr Andrews also touted the increase in Bahamas Waste’s share price from $3.34 per share in January to $4.90 at year-end, although this was aided by the company’s ongoing share buyback programme. This initiative, which runs until end-October 2021, has already seen the group acquire some 216,695 of its own shares for collective sum of $675,649.

The Bahamas Waste chairman, meanwhile, signalled that the company would seek further growth avenues for delivering shareholder value after its landfill bid was rejected by the government in favour of the New Providence Ecology Park group featuring Providence Advisors and a consortium of rival Bahamian waste services providers.

“During the course of the year we provided government with a proposal for the management of the dump, and a waste-to-energy plant,” Mr Andrews wrote. “We were not the chosen bidder for this work. We will continue to explore new avenues to improve the quality of our environment and to make this a better Bahamas for all residents and our tourist guests.”

Francisco deCardenas, Bahamas Waste’s managing director, added that Bahamas Waste’s share price had increased to “an all-time high” of $5.39 subsequent to 2018’s calendar year-end. He added that some $1m in dividends had been paid out to shareholders, with 9,173 shares purchased via the buyback process over the year.

Bahamas Waste’s profits rose from $1.141m in 2017 to $1.348m last year, fuelled by sales and services revenues jumping to $12.629m from $11.97m. Gross profits increased by 11.7 percent to $4.688m, with the rise sufficient to outstrip the 8.7 percent growth in total expenses to $1.294m. Operating income rose as a result by 20.3 percent to $1.294m.

The waste services provider also controlled accounts receivables owed by customers, which grew by only $30,000 during 2018 to $2.352m. Just $141,319 were taken in impairment losses on trade receivables, of which some $701,435 was 30 days past due; another $369,280 around 60 days past due; and $367,315 another 90-plus days past due.

Bahamas Waste also managed to reduce losses connected to its investment in associates to just over $117,000 in 2018, compared to $270,672 in 2017, after Green Systems - which recycles green waste into mulch, compost and soil - went from a $150,000 loss to just under $6,000 in profits.

However, Bahamas Sustainable Fuels, an entity that recycles cooking oil into biodiesel, continued to be a minor drag on Bahamas Waste’s results due to its $123,203 net loss. The BISX-listed firm sold a 51 percent majority stake in this business to 700 Islands Energy, a Bahamian company, for $180,433 in 2016, while retaining a minority 49 percent stake.

“The company extended a line of credit to Bahamas Sustainable Fuels for the purposes of settling operating expenses totaling $1.038m and lease payments of $14,370,” Bahamas Waste’s annual report said.

“These payments were offset against the fuel purchases from Bahamas Sustainable Fuels of $765,267, resulting in a net receivable from Bahamas Sustainable Fuels of $319,366.”

Bahamas Waste provided vendor financing to fund the purchase in the form of a 10-year loan with 5 percent interest, secured by 700 Islands Energy’s pledge of its shares, and a $135,398 balance was outstanding at year-end 2018. Bahamas Waste is also Bahamas Sustainable Fuels’ landlord, and has an agreement to buy a monthly minimum of 15,000 biodiesel gallons.