There are few who would argue that Trinidad Cement Ltd, the Claxton Bay company now known as the TCL group, is one of the more important companies in the Caricom region. The TCL group's importance comes out of the fact that it is one of a very few pan-Caribbean manufacturing companies with production capacity in three Caricom member states (T&T, Barbados and Jamaica) and that exports to all 14 members of the community outside of T&T. Among other reasons the TCL group is important are because it employs over 1,000 workers in its three production locations and it produces a commodity, cement, without which the region's buildings and infrastructure could not be constructed. The TCL group is also important because TCL, and its majority-owned Jamaica-based subsidiary, Caribbean Cement Company, are companies that are owned by thousands of individuals and scores of institutional investors right across the region. The institutional investors include the national insurance schemes of T&T, Barbados and Jamaica.
The success or failure of the cement producer is of critical importance to the wealth creation of the thousands of individuals who own shares in the company and the hundreds of thousands who look to the national insurance schemes for benefits. TCL should be one of the symbols of true Caribbean achievement as it is a Caribbean company that is staffed by Caribbean people, owned by Caribbean people, managed by Caribbean people, and whose product is used to build Caribbean homes and institutions. For all these reasons, TCL is a company that should be a source of tremendous pride to the inhabitants of the Caribbean nation-an icon of the possibilities of a Caribbean future based on the exploitation of our own resources for our own benefit. But, like that other icon of Caribbeanness, the West Indies cricket team, the TCL group has fallen on some hard times recently and is in need of intellectual and other assistance in climbing its way out of the hole that it has found itself in.
The most obvious sign of the fact that TCL is down a deep hole was the announcement on Friday that it had applied for an extension on the 90-day time limit required by the Exchange's Listing Rules for submission of the financial statements of Trinidad Cement Ltd (TCL) and Readymix (West Indies) Ltd (RML) for the year ended December 31, 2010. The extension was requested until April 30 in the first instance. This suggests that the company may be required to request a further extension of time in which to submit its financials. The fact that the company has delayed the production of its financials means that its shareholders have no basis of forming judgments about its most recent financial performance. One of the reasons given by the company for the delay was that it is in the process of negotiating debt restructuring with its lenders.
The last time TCL reported on its financial status was on December 3, 2010, when it declared a net loss attributable to its shareholders of $55.1 million for its third quarter, compared with a net profit of $17.9 million in the prior year period. This was described as "very disappointing but not unexpected results" which were caused by heavy losses incurred in the Jamaican and Barbadian subsidiaries due to continued depressed market conditions. As a result the group has breached its short-term borrowings and current ratio covenants, it disclosed in its third quarter report. Presumably, such breaches of its loan covenants could trigger the default clauses in any one of the financial institutions holding TCL's loan agreements, which is why the company has been forced to restructure its debt obligations.
While Caribbean bankers live in the region and are aware of regional realities, they also have shareholders and boards to whom they must report.
There is, therefore, no guarantee that TCL will be able to negotiate a restructuring of its debt obligations or that all of its bankers will go along with the proposals that the majority accept. It is not acceptable that TCL's shareholders should be left in the dark waiting on the company to negotiate a debt restructuring deal. The Stock Exchange here must insist that the company provides some financial information upon which investors can form judgments on whether to buy, sell or hold TCL shares.