BELIZE CITY, Belize, June 17 /PRNewswire/ -- BHI Corporation
(Nasdaq: BHIKF), a corporation operating financial and other service
businesses in Central America and the Caribbean, reported net income for the
twelve months ended April 30, 1997, of $17.7m (1996 - $14.6m before
restructuring and special charges), an increase of 21% over the prior year.
Earnings per share was $2.48 (1996 - $2.04 before restructuring and special
charges), an increase of 22%.
BHI's balance sheet at April 30, 1997, continues to strengthen with
shareholders' equity up 27% to $90.5m and net assets per share up 22% to
$12.43. Gearing remains minimal at 9%.
Commenting on the results, BHI's Chief Executive Officer, Allan Forrest,
said: "Fiscal 1997 was a year of strong performance for BHI and we are very
pleased to have beaten our goal of 20% growth in eps. We have achieved
continued expansion and strong growth in financial services while our equity
investments, especially NUMAR, have exceeded expectations. The focus for the
1998 fiscal year will be on regional expansion, principally in Central
America, in the areas of financial services, telecommunications, private power
generation and agro-processing."
The Directors have provided that shareholders of record on August 8, 1997,
will receive a dividend in Ordinary Shares of BHI on the basis of one new
Ordinary Share for every 86 Ordinary Shares then held. Shareholders will be
given the option to receive a cash dividend of $0.23 per share, payable on
September 2, 1997. On the basis that all shareholders receive Ordinary
Shares, the number of Ordinary Shares in issue, excluding treasury stock,
would increase by 1.2%. If all shareholders elect for cash, the total amount
payable would be $1.7m.
Financial Services
Income from Financial Services increased 20% to $7.8m (1996 - $6.5m) after
allowing for intercompany financing costs. This reflects a 17% increase in
average lending at the Belize Bank resulting in an 18% increase in net
interest income. Strong growth in non-interest income -- up 24% for the full
year -- reflects higher fee income from growth in foreign exchange
transactions and account service fees as well as increased income from growth
in the issuance and use of credit cards.
The bank's new state-of-the-art software platform, which is well into the
implementation phase, will provide accelerated data transfer and account
transactions and dramatically improve the bank's efficiency in both its
existing businesses and the on-going development of new products. The bank
will become the largest on-line, 24 hours per day, 7 days per week, network in
Belize.
The international financial services sector showed continued growth. The
number of US dollar accounts has continued to increase and average balances
grew by 13%.
Important new products developed in the second half of the year and now
ready for launch include internet brokerage services in conjunction with a US
brokerage house which will allow international clients to trade stocks on-line
at low cost, monitor their portfolios and to receive up to date market
information. In addition to a share of brokerage fee income, additional
revenues will come from each client's use of an International Business Company
structure managed by Belize Corporate Services Ltd. and other banking products
attached to such accounts.
Company and ship registration services (Belize International Services
Limited - BISL) continued their impressive growth: companies registered
increased 41% to 5,241 and ship registrations increased 35% to 1,857.
Importantly, the average tonnage of ships joining our registry continues to
grow at an even faster rate, increasing by 39%.
Equity Investments
Performance from BHI's equity investments exceeded expectations in the
twelve months ended April 30, 1997. BHI's equity in the net income of its
associates increased to $9.6m from $3.7m in 1996 reflecting a full year's
contribution from BHI's 23% investment in the NUMAR group, market leaders in
Costa Rica in edible oils. BHI's other equity investments include the
following holdings: 26% of Belize Telecommunications Limited (BTL), 23% of
Energia Global, Inc (EGI); and 20% of Belize Electricity Limited (BEL) in
energy.
Telecommunications
BHI's share of the net income of BTL was up 2% to $2.9m reflecting slower
overall growth in revenues (up 1% to $36.6m) but including strong growth in
cellular and other new service revenues - up 58% to $4.3m, offset by a 9%
decline in international call revenue to $11.2m. A major tariff rebalancing
was implemented during the year which is designed to stimulate future growth
in long distance and international calls. Dividends received for the twelve
months ended April 30, 1997, amounted to $2.0m, up 22% on the prior year
reflecting the strong underlying cash flow of the company.
Energy
BHI's share of the net income of BEL amounted to $0.5m (up 14% compared to
the prior year). BEL has 66MW of installed generating capacity of which 25MW
is provided by hydro and the balance from diesel generation. The company is
currently well advanced on its Power II project which involves a major
transmission line and a long term low cost supply contract from Mexico which
will ultimately allow for phase-out of the diesel generating capacity.
Highlights for the year for EGI include the commissioning and commencement
of commercial operation of the 16MW Don Pedro hydroelectric plant in Costa
Rica; funding and the advanced construction of the 17MW Rio Volcan plant,
also in Costa Rica; completion of the fourth round of capital raising with
$13.0m of new investment; and completion of a joint investment agreement with
strategic partners in El Salvador to participate in the forthcoming
distribution network privatization program.
Agro-processing and distribution
BHI's strategic investments in this sector include 23% of the NUMAR group
and 27% of Belize Food Holdings Limited.
The NUMAR group, market leaders in Costa Rica in edible oils and
margarine, industrial oils and animal feed, reported revenues of $189m for the
twelve months ended December 31, 1996, an increase of 15% over 1995 revenues
of $164M.
These increased revenues coupled with a strongly improved operating
performance resulted in a rise in pre-interest profits of 20% to $37.0
million. The strong cash flows have allowed for a reduction in NUMAR's
borrowings from $50.0 million to $25.0 million since acquisition.
BHI's share of net income for the twelve months ended April 30, 1997,
amounted to $6.9m. Export sales increased by more than 30% in volume and
NUMAR consolidated important commercial relationships in the export market
during the year.
The domestic business, including sales of refined products such as
margarine and shortening, was stable. In line with plans to increase
production capacity, 2,965 acres for new African palm plantations were
acquired and planted and 1,853 acres were replanted. The outlook for NUMAR is
favorable, particularly in light of the improving Costa Rican economy and
lower interest costs.
Other Services
Construction and Civil Engineering Operations
For the twelve months ended April 30, 1997, BHI's construction operations
reported an operating profit of $0.2m (1996 - $2.7m) on revenues of $30m (1996
- $45m). Cyclical factors in the construction sector and slower than
anticipated property sales in the Leeward property development are the main
reasons for this downturn in results. Hadsphaltic International Limited,
which operates exclusively in the Cayman Islands had another good year with
highlights including construction of condominiums for the Hyatt / Britannia
resort, expansion of a power station, and construction of health clinics and
school facilities in Cayman.
Although Johnston International fell below expectation in fiscal 1997, the
new year is off to an encouraging start with a strong order book including
such projects as a cruise port facility for Holland American Line and the
second phase of the Eastern Caribbean Central Bank.
At the Leeward integrated resort development, construction is almost
complete on the display village. A major launch function has been scheduled
for June 30, 1997.
Hotel Operations
BHI's hotel operations based on the 100-room Radisson Fort George Hotel &
Marina in Belize City reported strong growth in both occupancy and average
room rates with resulting improved positive cash flows. This reflects the
hotel's premier position in Belize's tourism market.
BHI Corporation is focused on growth opportunities in the emerging markets
of Central America and offers investors a unique opportunity to participate in
the region's growth. The Company operates financial and other service
businesses and also makes investments in growth industries including
telecommunications, energy, and agro-processing and distribution, taking
advantage of the region's increasing political stability, growing commercial
integration, and emphasis on privatization.
BHI prepares its financial statements in US dollars and in accordance with
US GAAP.
FORWARD LOOKING STATEMENT
Certain statements in this press release constitute "forward looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. In particular, statements contained herein regarding expectations
with respect to future revenue and business expansion, are subject to known
and unknown risks, uncertainties and contingencies, many of which are beyond
the control of BHI, which may cause actual results, performance of
achievements to differ materially from anticipated results, including, among
others, overall economic and business conditions, the demand of BHI's
services, competitive factors, regulatory approvals and the uncertainty of
consummation of future acquisitions. Additional factors which may affect
BHI's business and performance are set forth in BHI's filings with the
Securities and Exchange Commission.
Visit BHI on the Web at http://www.bhicorp.com
BHI CORPORATION
Consolidated Financial Highlights
US dollars in thousands, except per share and unit data
%
Years ended April 30, 1997 1996 change
Financial services $7,817 6,500 +20%
Elimination of intercompany
interest (note A) 154 659
7,971 7,159
Equity in net income of
associated companies 9,622 3,671 +162%
Other income 547 2,841
Other interest (expense)/income - net (456) 901
Income before restructuring and
special charges $17,684 $14,572 +21%
Restructuring and special charges -- (6,800)
Income before income taxes $17,684 $7,772
Net income $17,684 $7,772 +128%
Per Ordinary Share
Income before restructuring and
special charges $2.48 $2.04 +22%
Net income $2.48 $1.09 +128%
Cash dividends declared $0.45 $0.38 +18%
Net assets $12.43 $10.19 +22%
At Year End
Total assets $247,212 $226,148 +9%
Shareholders' equity $90,459 $71,069 +27%
Number of Ordinary Shares
in issue 7,461,509 7,284,723 +2%
Weighted average number of
Ordinary Shares (note B) 7,125,310 7,130,425
Notes:
A. Intercompany debt is a working capital funding source for the financial
services operations of the Corporation, and the results for this
business segment are shown after charging intercompany interest at a
consistent notional rate equivalent to the approximate average cost of
twelve-month certificates of deposit. Intercompany interest is
eliminated on consolidation.
B. Including A Ordinary Shares less treasury shares.
C. Certain prior year amounts have been reclassified to conform to current
year presentation.
BHI CORPORATION
Consolidated Balance Sheets
US dollars in thousands
April 30, 1997 1996
Assets
Cash, cash equivalents and due from banks $14,305 $14,503
Interest-bearing deposits with correspondent banks 28,643 26,676
Government of Belize securities -- 10,411
Other securities -- 4,389
Loans (net of unearned income) 108,156 87,201
Less: allowance for loan losses (1,907) (1,654)
Premises and equipment 22,483 21,091
Equity investments 55,209 45,797
Other assets 20,323 17,734
Total Assets $247,212 $226,148
Liabilities and Shareholders' Equity
Deposits:
Demand $29,112 $30,190
Savings 28,194 25,911
Certificates of deposit 82,244 78,214
Total deposits 139,550 134,315
Short-term debt 7,165 4,984
Other liabilities 9,434 15,072
Long-term debt 604 708
Total liabilities 156,753 155,079
Commitments and contingent liabilities
Shareholders' Equity
Share capital 75 73
Additional paid-in capital 47,290 44,177
Retained earnings 46,143 31,671
Treasury shares, at cost (2,844) (4,633)
Translation adjustment (205) (219)
Total shareholders' equity 90,459 71,069
Total Liabilities and Shareholders' Equity $247,212 $226,148
BHI CORPORATION
Consolidated Statement of Shareholders' Equity
US dollars in thousands
1997 1996
Balance, May 1 $71,069 $68,274
Net income 17,684 7,772
Treasury shares sold/(acquired) 1,908 (4,633)
Translation adjustment 14 (13)
Cash dividends paid (note) (216) (331)
Balance, April 30 $90,459 $71,069
Note: Shareholders who did not elect to receive cash were issued an
additional 176,786 Ordinary Shares in the Corporation.
BHI CORPORATION
Consolidated Statements of Income
US dollars in thousands, except per share amounts
Years ended April 30, 1997 1996 1995
Financial Services
Interest Income:
Interest and fees on loans $18,196 $16,078 $13,885
Interest on deposits with banks 1,245 1,031 782
Interest on Government of
Belize securities 183 240 134
Interest on other securities 422 533 528
Total interest income 20,046 17,882 15,329
Interest Expense:
Interest on deposits 7,866 7,117 4,842
Interest on short term debt 87 -- --
Interest on long-term debt 39 45 50
Intercompany interest(A) 154 659 2,080
Total interest expense 8,146 7,821 6,972
Net interest income 11,900 10,061 8,357
Provision for loan losses (374) (195) (214)
Net interest income after provision
for loan losses 11,526 9,866 8,143
Non-Interest Income 4,268 3,448 3,989
Non-Interest Expenses:
Salaries and benefits 3,738 3,366 2,853
Premises and equipment 1,314 1,191 1,231
Other non interest expenses 2,925 2,257 2,582
Total non-interest expenses 7,977 6,814 6,666
Total - Financial Services 7,817 6,500 5,466
Elimination of intercompany
interest(A) 154 659 2,080
TOTAL 7,971 7,159 7,546
Equity in Net Income of
Associated Companies 9,622 3,671 2,795
Other income 547 2,841 137
Restructuring and special charges -- (6,800) --
Other interest income 267 1,108 1,616
Other interest expense 723 207 159
Income from operations before
income taxes 17,684 7,772 11,935
Income taxes -- -- (175)
Net income $17,684 $7,772 $11,760
Earnings per Ordinary Share $2.48 $1.09 $1.68
(A) See note 1 to Consolidated Financial Highlights.
SOURCE BHI Corporation
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CONTACT:
Eileen M. Halsch of Broadgate Consultants,
Inc., 212-229 2222, for BHI
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