Kintyre Holdings (JA) Limited, formerly iCreate Limited, reported a notable increase in quarterly profits for the July to September period of 2024 — its third quarter — with a net profit of $21.4 million. This surpasses the company’s previous quarterly high of $10.1 million, achieved in the first quarter of 2022.

“What we are seeing is everything coming together being an investment holding company, and how those synergies will help us to be more profitable,” Tyrone Wilson, chairman, president and CEO of Kintyre Holdings (JA) told the Jamaica Observer, about the performance in a recent interview.

The executive summary released with its third quarter financial statements pointed to the “strong performance” of its Visual Vibe subsidiary in the overall results, as the entity acquired in June 2023 for $588 million, is now the most important subsidiary of Kintyre Holdings, an investment holding company owning five entities — iCreate Limited, a training institution; Visual Vibe, a digital advertising company; GetPaid, an e-commerce platform; Parallel Real Estate Ventures, a real estate company; and Sevens, a restaurant in Kingston, Jamaica.

Given that Kintyre Holdings financial year runs from January 1 to December 31 each year, 2024 is the first full year in which its Visual Vibe subsidiary has been part of the group, and its impact was most telling between July and September 2024.

Details of Visual Vibe’s financial performance were not released, except for a brief statement in the executive summary that its operating profit for the period covering January to September 2024, was up 47 per cent. It is not clear, from the financials presented, how much of the $21.4 million profit was produced by Visual Vibe, but Kintyre Holdings’ report highlighted “the positive shift in net profit is attributed to the increased revenue from the DOOH advertising segment and greater control over operating expenses.” DOOH is the acronym for digital-out-of-home advertising and are ads that are displayed on digital screens in public spaces, which for Visual Vibe are its digital outdoor advertising boards and the indoor advertising boards it is currently rolling out.

But Visual Vibe has been a significant addition for Kintyre Holdings. The company no longer breaks out segment results, but the last time it did so for the results published for the third quarter of 2023, it noted that its Visual Vibe subsidiary contributed 48 per cent of revenues for the nine months to September 2023 with $37.5 million of the $78.6 million in sales during that period coming through Visual Vibe. On the profit side, Visual Vibe generated $27.2 million over the first nine months of 2023 of which $15.1 million was earned during the June to September period in which Kintyre Holdings, or more appropriately at the time, iCreate Limited, owned the entity.

For the nine months to the end of September 2024, Wilson said cost cutting also contributed to the performance of Visual Vibe.

After the acquisition, there were duplications in staff roles, technology, and other expenses. Wilson said by consolidating offices and streamlining operations, the company reduced expenses by millions which led to the substantial increase in operating profit. Revenues for Visual Vibe he pointed out, only grew by 8 per cent, which would put it at around $40-million mark for the nine months, considering it was $37.5 million during the same period in 2023.

“Just being a part of the overall group we were able to cut costs in certain areas to enable the business to be more agile. Also, we had more revenues…with companies advertising with us directly as oppose to through the agencies and that carried stronger margins for us.” Getting ads directly instead of through ad agencies meant the commission which is normally 18 to 20 per cent was kept by Visual Vibe which helped to improve the company’s gross profit margin.

Outside of that, Kintyre Holdings (JA) also benefited from the improvement in value of some of its real estate assets that impacted its revenues and profits during that period.

So far this year, Kintyre Holdings has struck strategic partnerships and new business initiatives for its Visual Vibe subsidiary in the indoor advertising space and partnered with
SportsMax as its official out-of-home advertising partner for the 2024 Olympics, showcasing live streams of key races on its outdoor billboards on Hope Road in St Andrew, Spanish Town in St Catherine and North Parade in downtown Kingston. It has also upgraded its Manor Park and Half-Way-Tree, St Andrew billboards to the latest technology while it is in the process of doing likewise for its billboard at Emancipation Park in New Kingston, also in St Andrew, while the introduction of new advertising products like the backpack billboards and indoor digital screens are new innovations it has pursued. The company has even partnered with Yello Media group — a regional marketing agency — to develop affordable outdoor advertising for small and medium-sized enterprises (SMEs).

Still, despite its success so far, Wilson wants to drive it faster, but with only $1.8 million in cash in its name in banks as at September 30, 2024, he hardly has the resources to drive the growth he wants to see, in any of the subsidiaries and particular in Visual Vibe.

“We are doing a lot, where Visual Vibe is concerned. It’s having its best year, this year, in terms of profitability and also product innovation, but if there are partnerships that exist that can enable us to catapult and bring it forward at a much faster pace, we are looking at those, too,” he said.

Since acquiring Visual Vibe last year June, Wilson has divested 40 per cent of the entity, reducing the stake in the digital-out-of-home advertising company to 60 per cent. He told
BusinessWeek that he is not “necessarily looking for an all-out divestment” of any further shares, but conceded that he is open to talks.

“We are flexible, if there is an equity partner that is interested in taking a sizeable stake, whether it is to buy out an existing investor or inject cash in the business, we are open. Whether its loan, whether its equity, joint venture, we are very open and we talking to a few players now. Visual Vibe has significant opportunities and we not doing the business any justice by remaining where we are,” Wilson said.

He said after years of using issuing shares or loans to acquire businesses, he is now focused on returning equity to shareholders which requires “a greater level of profitability than where we [are] at now.”

Yet he acknowledged that will not only come from squeezing all he can from Visual Vibe. The other entities in the group are being revamped to help deliver on the results that Wilson said he hope will continue beyond the outturn of the July to September quarter.

But ahead of that, the need for cash to grow has led Kintyre to consider divesting its Chalet development in St Ann, a development done through its Parallel Real Estate Ventures.

“Parallel is a very critical part of our growth plans going forward; however, we are looking at some of the assets that we have like Chalet in St Ann, Discovery Bay, where we are looking at everything where we can unlock cash flow. So, if there is a real estate company that we believe can do a better job of bringing these apartments to market quicker and they would want to acquire that development from us, we are open to it,” Wilson said.

The Chalet was announced in April 2022 as a project to build eight luxury residential units — three 2-bedroom condos, two 3-bedroom condos and three studio condos — as part of plans to pivot to earning US$2 million in revenues and US$1 million in profits by the end of December 2023, but two-and-a-half years later and with an additional acquisition in the form of Visual Vibe, the revenue and profit target remains outstanding.

The project has since been upgraded from eight units to 26 and is now going through the process of getting approvals from the National Environment and Planning Agency (NEPA) and the others needed to do the construction. Wilson said US$1 million has already been invested in all the infrastructure necessary for the project to be completed within 12 months. He did not disclose how much he is seeking from selling the development to a new investor.

The iCreate Institute, the first company in the group, was hit hard by COVID-19 and was behind the reason the company accelerated a merger and acquisition strategy to diversify its revenues beyond a single source. It was largely parked while Wilson pursued other acquisitions, but now, he said it will form a critical part in the growth of Kintyre Holdings, going forward.

“Now that we have restructured to Kintyre Holdings, where we are looking at the business now is to expand iCreate beyond just digital creative training. We [are] looking at areas like artificial intelligence, we [are] looking at areas like entrepreneurship. There is a lot more that we can do in areas like finance and fintech, and within the broader scope of short skills…. that we are looking at launching in January of 2025.”

As for its other subsidiaries, Sevens Kingston Limited and GetPaid, he has outlined plans as well for them to contribute to the overall growth of Kintyre Holdings.

Seven Ultra Lounge is now being renovated and will seek to capitalise on the fact that more Jamaicans are eating out to boost its offerings and opening time to include lunch instead of just the evening meals that it now serves when it reopens sometime in “February or March next year”.

As for GetPaid, which contributed 31 per cent of Kintyre’s business last year, new products are coming.

“Similar to what we are doing with the Institute, we have two to three new suite of services that we are rolling out, and one of them that I can speak about now is called Swipe to Rent, and that is where we are enabling individuals to pay their rent by using their credit card.”

Wilson said a beta version of the product will be launched shortly ahead of full roll-out later in 2025.

“We are building out those services for individuals and we also have a suite of services for small businesses that will enable them to send their invoices, collect payments, use cloud telephony, track vehicles, all of those different things we are looking to bring forward. We have been quiet, yes, but it’s because we are in development mode for GetPaid.”

He said progress has been slow so far on talks to acquire a 20 per cent stake in MVL, an operator of Beach Club Resorts, Restaurants and Lounge in the British Virgin Islands.

“That is a big play; we talking to some financial partners. We haven’t made significant progress since making the disclosure on it in October, but we hope to do so sometime early in the new year; it’s a significant investment.”

That apart, with the performance so far this year, and with profits for the full nine months to September 2024 at $20.4 million, Wilson is optimistic about a turnaround in the fortunes of the company that has not made a profit since inception in 2018, even before it was listed in February 2019. So far, for the 23 quarters over which the company has been public, iCreate, and now Kintyre, has published quarterly results for 22, showing it recorded a profit during 11 of those quarters, but has never recorded a profit for a full year.

In 2019, the first year of its listing, it racked up $45.9 million in losses which when added to its 2018 losses, brought its accumulated losses at the end of 2019 to $61 million.

Its auditors at the time, Crichton Mullings and Associates, flagged the losses early on in the audit of the company’s 2019 financial statements, the first after listing. “From inception the company has not achieved the level of revenues projected and required to sustain its operations. This indicates the existence of a material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern,” Crichton Mullings and Associates wrote then, and continued to flag the company as a going concern, up until its last audit for the 2022 financial year when accumulated losses reached $162 million.

By the end of 2023, the accumulated losses reached $322 million which includes acquisition expenses of $107 million. The losses are a far cry from the $62 million profit that was projected in the company’s prospectus for 2023.

But Wilson is betting that things will turn around, at least this year.

“We are closing out the year very strong, with what we believe will be our first full profitable year since being listed,” Wilson said.