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ICreate IPO Summary

ICreate IPO Summary



About iCreate Institute

Originally a subsidiary of eMedia Interactive Group Limited, iCreate has blossomed. Conceptualised in 2012 to be an internship programme for creatively inclined youth, iCreate labels themselves as a ‘creative learning institute’ striving to bridge the gap in skills training and the development of creatives within the region. With three locations in North America and Jamaica collectively, iCreate believes that their array of courses offered will attract multiple markets. At the moment their student-body consists of both aspiring creatives and companies wishing to broaden their employees’ aptitudes. iCreate focuses on innovation, keeping up-to-date with trends and counteracting an ageing workforce in the ever-changing digital arena.

iCreate now finds themselves positioned as the official media institute of the University of the Commonwealth Caribbean (UCC)located in both Kingston and Montego Bay, Jamaica. The primary direction of the company upon inception was to provide work experience and training in creative skills for young individuals who desire a career as a creative, and university students who wish to gain experience. The company divides their primary operations into two groups, namely Creative Courses and Digital Courses. Their partnership with UCC has yielded the offering of accredited Creative Certificate Courses. Digital Courses are also provided at the two aforementioned locations.

Courses Offered at the Kingston Location

  • Animation Certificate Course
  • Advertising Certificate Course
  • Content Marketing Certificate Course
  • Creative Writing Certificate Course
  • Digital Video Production Certificate Course
  • Graphic Design Certificate Course
  • Photography Certificate Course
  • Project Management for Creatives Certificate Course
  • Professional Diploma in Digital Marketing

Courses Offered at the Montego Bay Location

  • Digital Video Production Certificate Course
  • Professional Diploma in Digital Marketing (in partnership with DMI)

Both locations boast state-of-the-art, up-to-date infrastructure with facilities such as:

  • Computer Labs (with IMAC computers)
  • Creative Labs
  • Video Production Studio fitted with suitable production equipment
  • Photography Studio
  • Students’ Lounge

The curriculum offered at both locations will soon see new growth. Mobile Gaming and Live TV Production are two courses impending at both sites. Additionally, the Montego Bay site is looking to match the courses already being offered in Kingston.

As it relates to regional and international expansion, December 2018 welcomed the commencement of a three year agreement with the Digital Marketing Institute (DMI) which states that they are now the sole partner for Jamaica, Barbados, Grenada and Trinidad and Tobago. Additionally, the company has laid the framework to support expansion in Miami, Florida as it is currently in the early stages of business development. 

iCreate Limited was incorporated in Jamaica on January 22, 2018, with their main office located at 72B Hope Road, St. Andrew.

 

Key Offer Information

The Initial Public Offering (IPO) for iCreate Ltd. opens at 9:00am on January 31, 2019 and closes at 4:00pm on the 14th February, 2019 (due date for applications). Applications will be received prior to the opening, but will not be processed until the IPO officially opens. This offering will be primarily brokered and co-brokered by Sagicor Investments Jamaica Limited and GK Capital Management Limited, respectively.

The shares will be offered to three categories of applicants: Key Pool A; Key Pool B; and the general public.

Key Pool A represents key investors of the company, and as such their loans are being converted and offered into share equivalency. There are up to 24,062,500 (24 million, 62 thousand and five hundred) ordinary shares being reserved for individuals who qualify for this group, being sold at $0.81 per ordinary share.

Key Pool B represents directors, employees, customers, suppliers and minor investors of the company. There are up to 20,000,000 shares being reserved for this group at $1.01 per ordinary share.

30,000,000 shares will be offered to the general public at $1.01 per ordinary share. That brings the total shares being sold to a value of 74,062,500. A separate 100,000,000 shares remain with the main shareholder, eMedia Interactive Group Limited. The minimum purchase is 1000 ordinary shares. Any application request exceeding this must be made in multiples of 100.

Preceding this IPO, holdings within the company were as follows:

  • eMedia Interactive Group Ltd. 100,000,000 shares                              95%
  • Sagicor Investments Ja. Ltd. and/or Nominee 23,530,000 shares                                 05%
  • Total Issued Shares 123,530,000 shares                             00%

These figures were formulated on November 30, 2018, the latest date feasible before the prospectus had to be drafted and presented.

Proceeding successful invitations, holdings will be as follows:

  • eMedia Interactive Group Ltd. 100,000,000 shares                              61%
  • Sagicor Investments Ja. Ltd. and/or Nominee 23,530,000 shares                                 91%
  • Key Partner Pool A 24,062,500 shares                            18%
  • Key Partner Pool B 20,000,000 shares                            12%
  • General Public 30,000,000 shares                            18%
  • Total Issued Shares 197,592,500 shares                             00%

 

The company aims to obtain a minimum total of $50M. In the event that this is not achieved, or the criteria for admission to the Junior Market of the Jamaica Stock Exchange (JSE) are not met, the money invested will be refunded and returned to their respective sources.

 

Purpose of the IPO

An IPO in the most basic of terms is fundfraising. The IPO allows for additional investors and as such, it would be best to know what you’re investing in. The proceeds of this invitation are intended for the following purposes:

  • Covering the expenses incurred by the invitation which have been estimated to be $12M or less inclusive of GCT (brokerage fees, legal fees, auditing and accounting, registrar fees and marketing expenses)
  • Purchasing additional equipment, computers and software in order to deliver courses
  • Expand the physical infrastructure at both the Kingston and Montego Bay locations. This will be in the form of additional computer labs, training rooms and workshop spaces.
  • To facilitate the implementation of new courses (certified professional diplomas, Bachelor’s Degrees, etc.) and corporate training
  • The facilitation of regional and international expansion

 

Financial Performance 2018 (Profit/Loss)

For the previous financial year, only the first quarter (Q1; Jan 1 - Mar 31) was able to be audited. As such, these will be the (rounded) figures highlighted.

         January 1 - March 31, 2018 : Audited Q1

       Revenues                                                    $11.69M

         Direct Expense                                        $833,554

         Gross Profit                                $10.85M

         Expenses                                                     $7.83M

         Profit prior to taxation             $3.02M

 

The Digital Courses, Certificate programmes, and Corporate Training accounted for an estimated 42%, 40%, and 18% of the recorded revenues for the period, respectively.

In regards to the unaudited second and third quarters (Q2 and Q3) consisting of April 1st - September 30th 2018, revenue saw an increase of $17.7M. The contribution from Digital Courses was said to grow by approximately 8% in relation to Q1. Certificate programmes were said to be responsible for 45% of the total $17.7M, with Corporate Training seeing a decrease in contribution, attributing approximately 5% to the total revenue.

For the period (Q1 - Q3), the net earning was calculated at $-4.18M (net profit margin of -24%) with the fixed costs incurred with the expansion taking place in Montego Bay and Miami.

 

 

 

Dividend Policy

Upon meeting the necessary criteria for admission to the JSE, it is the intention of the Directors to issue annual dividends of up to fifty percent (50%) of the net profits available for distribution. This is subjected to the need for capital for reinvestment in the company at any given time.

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