 Research Note by SINGER Capital MarketsOn 13 May 2024, an extensive research note regarding CEIBA Investments Limited was published by SINGER Capital Markets ("SINGER"), the primary broker of the Company. SINGER's main conclusion regarding the Company is as follows:"... CEIBA has demonstrated an ability to operate in a difficult environment and owns profitable assets that are attractively valued that, subject to currency restrictions, are capable of generating a decent investment return. In addition (and there is no sign of this occurring), should the US relax or remove its sanctions regime, or should Cuba be more successful in its ongoing reform efforts, we see room for considerable upside from the normalization of asset values. The removal of Cuba from the controversial US State Sponsors of Terrorism list alone would have a significant positive effect on tourism to Cuba. That said, the short term outlook is difficult and reflected in the fund's valuation. At this level and acknowledging the risks, we see CEIBA as offering an attractive asymmetric return profile for a long term investor..." |
"The research note can be accessed on Research Tree (https://www.research-tree.com/), or by financial institutions and investment professionals by clicking on this link. |
hTTps://ceibainvest.com/updates/ |
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5 MARCH 2024 BY SEBASTIAAN BERGER
A good start to 2024. Update from the Manager
Meliá Trinidad Península during sunset
Meliá Trinidad Península during sunset
On 14 January 2024, the City of Trinidad, Cuba, commemorated the 510th anniversary of its foundation. As part of the official celebrations of the day, the Meliá Trinidad Península Hotel was officially opened by Cuba’s Prime Minister Manuel Marrero, the Minister of Tourism Juan Carlos Garcia and Gabriel Escarrer, President of Meliá Hotels International S.A. (“Meliá”). The hotel is a 401-room international 5-star beach resort hotel located on prime beachfront property within easy reach of the City, as well as of and the natural beauty of the Valle de los Ingenios and the Escambray mountain range.
The hotel features numerous swim-up pools, smart technology, 14 restaurants and bars and a YHI Spa. A substantial portion of the energy consumed by the hotel is generated on-site and stored through extensive combined solar panel and battery pack installations and is already being praised as one Cuba’s best hotels. The total investment made by the Cuban joint venture company TosCuba S.A. (“TosCuba̶1;) was approximately $79 million, of which $72 million was in construction cost. TosCuba received more than US$11 million in grants under the Spanish Cuban Debt Conversion Programme.
CEIBA Investments Limited (“CEIBA” or the “Company”;) has been the principal investor, lender and driving force behind this development and with the startup of operations CEIBA’s investment commitment has been concluded. Debt service under the construction facility is scheduled to begin in the second quarter of 2024. CEIBA has an interest of US$5.2 million (32.5%) in the share capital of TosCuba and a debt participation of US$41 million under the US$51.5 million construction facility.
The accompanying video was produced by our strategic partner, Meliá Hotels International S.A., to highlight the development and opening of the hotel.
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The Company is very grateful for the tremendous collaborative efforts made by Jesús Hernández (President of TosCuba) and his team at the joint venture company, CEIBA’s team members in Havana and Madrid, Meliá, and the numerous national and international suppliers who made it possible to complete this ambitious project during and immediately following the great disruption caused by the Covid-19 pandemic. We are proud of this property and happy to begin welcoming visitors to this fascinating part of the island. |
10% Euro Bonds
Interests of Directors and Executives in the Convertible Bonds
At 30 June 2023, Directors had an interest of €nil (US$nil), executives had an interest of
€400,000 (US$434,640), and shareholders of CEIBA had an interest of €10,500,000
(US$11,409,300) in the Bonds.
At 31 December 2022, Directors had an interest of €nil (US$nil), executives had an
interest of €400,000 (US$426,640), and shareholders of CEIBA had an interest of
€10,500,000 (US$11,199,300) in the Bonds (see note 11). |
Annual report - |
hTTps://quoteddata.com/2022/09/ceiba-struggles-access-cash-cuba/?utm_medium=email&utm_campaign=News+weekly+Email+125th+-+Pro&utm_content= |
And nav out today:
UNAUDITED NET ASSET VALUE PER SHARE AS AT 30 SEPTEMBER 2021
CEIBA Investments Limited, the largest international company solely dedicated to investing in Cuba, announces that its unaudited IFRS net asset value per share ("IFRS NAV") as at 30 September 2021 was USD 1.2967 (30 June 2021: USD1.3089).
Applying the GBP:USD exchange rate as at 30 September 2021 of USD1.3484/GBP1.00 (30 June 2021 USD1.3819/GBP1.00), the unaudited IFRS NAV in Sterling was GBP0.9616 (30 June 2021 GBP0.9472) per share. |
Gloomy in the sun:
2021 Year End and 2022 Outlook
The above-mentioned drop in tourism income from the hotels of Miramar and the expected lower valuations of both the hotel assets and the Miramar Trade Centre will have a negative impact on the Company's 2021 audited year end results that will be published at the end of April 2022.
However, if during the present year the Company is able to find a structural solution to create financial autonomy for Monte Barreto and international tourism continues to recover, and even more so if during 2022 the Biden administration takes steps to ease the Cuban embargo, at least as regards family remittances and U.S. travel, Cuba and CEIBA's liquidity position would greatly improve which in turn could lead to a much brighter outlook for the Company by the end of the year. |
Presentation from last month: |
hTTps://www.ceibalimited.co.uk/en/news |
Aberdeen;
To finalize the construction of a 400 room beachfront hotel, Melia Trinidad Peninsula, CEIBA investments is looking to issue a 5 Year Convertible Bond with a 10% Coupon
Raise 20M EUR
Interest at 10% per annum, paid quarterly
Debt instrument to be listed on The International Securities Exchange (TISE), Guernsey
Closing date of 31 March 2021 (single drawdown) |
Optimistic!
I bought a v few in the summer because I thought it looked v cheap even if Biden didn't win. The nav is very conservative and the balance sheet is strong. The div will get resumed at some point. It is a fairly unique vehicle. One day Cuba will come good and CBA will do very nicely.
Worth noting that HAST (in run down) held a decent stake which is still to be sold. So an overhang. Although perhaps there are instis out there who fancy some Cuba and that's why the board are seeking share issuance approval. |
Hi, ram - I haven't looked since Trump blanked Cuba, so thanks for the reminder posts.
What comes after "realistic" then "hopeful"? |
Citywire:
If you need a wide discount to tempt you to frontier markets, Ceiba Investment (CBA), a £131 million Cuban property fund investing in hotels and offices on the Caribbean island, is available at 19% below NAV, which compares to the 16% one-year average and gives it a Z-score of -2.2. Last year the fund’s long-standing investment team led by Sebastiaan Berger joined Aberdeen Standard Investments and in October raised £30 million listing on the London Stock Exchange. At the end of January it reported it had deployed the new money, repaying a bridging loan, investing in the merger of two hotel companies and contributed to the financing of the construction of a new 400-room hotel. It yields 4.7% and pays one dividend a year.
Latest quote was 92-98, no trades. A trap, I guess. |
60th anniversary of revolution. Castro criticises US (ie. Trump) for confrontational policies.
New constitution announced.
Cuban youth anxious for change.
Too early, I think, to declare "opportunity beckons", but NAV is around 120p (USD-denominated) and assets are mainly JVs in luxury tourist hotels. 4% yield mooted.
Management fee 1.5% of nav. High but fairly typical of "specialist" funds. |
. .
Aims to provide a regular and attractive level of income return together with the potential for long term income and capital growth from investing in Cuban real estate and other assets directly related to Cuba. |
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