Businessuite Markets
Guardian Holdings Exceptional Nine Months Performance Mainly Driven By Improved Performance Across Key Business Segments
Consistent with our strategy, we continue to make great strides in perfecting and protecting our core across several dimensions including capital management, risk management, technology investments, operational efficiency, product development and people and culture.
The Group’s strong capitalisation and diversified business model has positioned us well to respond to the changing business landscape and to navigate the ongoing uncertainties in our investment markets and the macro environment.
For the nine months ended 30th September 2024, the Group recorded unaudited profit attributable to equity shareholders of $598 million exceeding the prior year’s restated results of $464 million by $134 million or 29%. This exceptional performance was mainly driven by improved net insurance service result, higher net investment income, higher insurance brokerage fees and commission income and lower other operating expenses partially offset by higher net insurance finance expenses and higher finance charges.
Our positive momentum continued in 2024, delivering another quarter of robust results despite third quarter profits being impacted by additional incurred claims from Hurricane Beryl.
Compared to the prior quarter this year, third quarter profits of $197 million surpassed second quarter performance by $30 million or 18% mainly due to higher net income from investing activities and lower net insurance finance expenses offset by lower insurance service results, higher operating expenses and higher taxation.
Correspondingly, third quarter profits also outperformed the prior year’s quarterly profits of $85 million by $112 million or by 132% mainly due to higher net income from investing activities and higher insurance service results partially offset by higher net insurance finance expenses.
Before presenting further commentary on the Group’s year-to-date financial performance, we highlight that in the prior year’s third quarter publication, the Group reported unaudited nine months 2023 results of profit attributable to equity shareholders of $382 million. This was subsequently updated to include the non-recurring net fair value gain of $174 million arising from the model change implemented by our Jamaican operations, thereby reclassifying financial assets supporting life and annuity portfolios from amortised costs and fair value through other comprehensive income to fair value through the profit and loss.
The change was also reported in the Group’s audited results for the year ended 31st December 2023. This update coupled with IFRS 17 related refinements increased the year-to-date nine months 2023 comparative results from $382 million to $464 million. The succeeding commentary on the 2024 performance of your Group refers to the restated 2023 financial statements as opposed to those previously reported.
Further to highlighting your Group’s year-over-year profitability growth achievement of 29% above, we also report that balance sheet metrics remain strong, and we continue to create value for shareholders in the current operating environment.
The Group remains sufficiently capitalised and compliant with regulatory ratios.
On September 20, 2024, CariCRIS reaffirmed the assigned ratings of CariAA- on the regional rating scale and jmAAA on the Jamaican national scale for Guardian Holdings Limited with a stable outlook.
When compared to the prior year’s nine-month results, the Group’s equity / book value per share increased from $15.70 to $18.58, return on equity increased from 19% to 20%, earnings per share increased from $2.00 to $2.58 and interim dividends paid increased from $0.22 to $0.23.
Insurance revenue grew by $363 million or 9% over the prior year mainly from continued growth in core business across the Group’s diversified product offerings in the English-speaking and Dutch Caribbean markets.
The Life, Health and Pension (LHP) segment contributed insurance revenue of $2.2 billion, up from $2 billion in the prior year by $183 million or 9%. Insurance revenue increased on all lines except Group Health, as clients continued to service their policies coupled with new business growth across all territories.
This year-over-year increase in revenue was partially offset by increased insurance service expenses impacted by a higher level of health claims and directly attributable expenses. Total gross claims paid by the LHP Segment for the current period amounted to $2.2 billion compared to $1.8 billion in the prior year.
Property and Casualty (P&C) also reported higher insurance revenue of $2.2 billion, up from $2 billion in the prior year by $180 million or 9%, principally from operations in the Trinidad, Jamaica and Dutch Caribbean markets. Both the property and motor lines of business experienced revenue growth as they continued to build strong momentum.
The year-over-year growth in revenue was largely offset by higher insurance service expenses from higher incurred claim expenses. Total gross claims paid by the P&C Segment for the current period amounted to $494 million compared to $325 million in the prior year.
The impact of net claims incurred from Hurricane Beryl is reported in the above results. The P&C segment continues to closely manage the general tightening of reinsurance markets. For the reporting period, reinsurance expenses declined over the prior year benefitting from a higher level of incurred claims recovery.
Net income from investing activities increased by $51 million mainly from higher investment income and higher realized gains partially offset by lower net fair value gains and impairment losses.
Excluding the previously referenced non-recurring net fair value gain of $174 million in the prior year’s results, the Group would have achieved a normalized year-over-year increase in net fair value gains and net income from investing activities of $119 million and $225 million respectively.
Your Group continues to closely monitor volatile markets and rebalance portfolios, as necessary.
Net insurance finance expenses increased by $58 million or 11% over the prior year, mainly from our LHP segment. Among other items, finance expenses include the flow through of the portion of net income from investment activities that is associated with insurance products with an investment component.
For the reporting period, this impact was less favorable to the Group’s insurance liabilities; however, the impact was favorable for our clients as they earned higher investment income of $212 million in the current period due to growth in the policyholders’ underlying funds, which resulted in higher expenses for the Group.
The Insurance Brokerage segment recorded fee and commission income of $191 million, up 8% from the prior year. This was mainly due to increased income from our operations in the Netherlands, Dutch Caribbean and Cayman Islands.
The Asset Management segment reported a marginal year-over year decline in after-tax profit for the period of 2% from higher finance charges partially offset by improved net investment income results and lower operating expenses. The Group continues to focus efforts on developing this segment through third-party business, increased structuring, and trade activities.
Other operating expenses that were not attributable to insurance portfolios decreased by $9 million or 1% year-over-year from a reduction in controllable expenses from the active management of operating expenses.
Your Group remains focused on completing its journey to perfect and protect our core which remains at the heart of our operations, so as to increase the organization’s generation of free cash flow per share, which is essential to enabling resilience and sustainable growth.
As we continue to implement planned changes, the Group remains resolute on optimizing performance whilst building out the phases of our strategic journey geared toward further technological enhancements, exploring new markets, strengthening our product portfolio, and improving our service delivery.
Robert Almeida Chairman Guardian Holdings Limited
For More Information CLICK HERE
Businessuite Markets
Barita Reporting Treasury, Trading And Brokerage And Investment Banking Business Lines As Largest Contributors FY24 Performance
Net profit after tax (“NPAT”) for Q4 FY24 increased by 200% to $999 million, bringing NPAT for FY 2024 to $3.9 billion, 14% ahead of 2023. The improvements achieved in Q4 FY24 reflected the effects of management’s strategy to influence improvements in operating revenue through a focus on active balance sheet management, revenue diversification and expense management, in particular the management of funding costs.
Revenue growth in Q4 FY24 was both robust and well-distributed, led by an exceptional performance in our Treasury, Trading and Brokerage business line, which accounted for 56% of total revenue. This improvement was supported by the continuation of the uptrend in net interest income which rose 3% to $164 million relative to the comparable quarter in financial year 2023.
Directionally, this performance aligned with expectations, buttressed by a pivotal shift in the monetary policy stance of the Bank of Jamaica and the US Federal Reserve, both of which reduced their benchmark policy rates by 25 and 50 basis points respectively, during the fourth quarter. While an additional 25 basis point cut was announced at the end of September, to come into effect at the beginning of October, the BOJ had communicated a shift in its policy posture during Q3 FY24, to which the market began to react via the downward repricing of liabilities, by extension, benefitting our Net interest income. The balance of risks points towards continued improvement in our net interest income as our interest-bearing liabilities reprice with a more frequent cadence.
The macroeconomic landscape has also evolved favourably. Domestic inflation has moderated, now averaging within the BoJ’s target range for the last 6 months, and a similar moderation has taken hold in the U.S.A., even as the Federal Reserve continues to signal a cautious, data-driven approach to future rate cuts. While these developments suggest a more stable financial environment prospectively, potential global risks remain. Slowing growth in key global markets, coupled with geopolitical uncertainties and the impending change in administration following the recent election in the US could introduce volatility; however, Barita’s diversified revenue streams and resilient business model position us well to navigate these headwinds.
Operating Performance
Barita generated net operating revenues of $10.0 billion for FY24, representing an increase of 10% or $901 million relative to FY23. The increase was broadly distributed across our various business lines, with income from the treasury, trading and brokerage and investment banking business lines being the largest contributor.
Net profit was $3.9 billion for FY24, rising 14% relative to FY23. The resulting earnings per share (“EPS”) was $3.24, up 14%.
Quarterly Performance
For the quarter ended September 30, 2024, Barita registered revenue of $3.0 billion, $1.2 billion or 72% higher than Q4 FY23, driven by a material uplift in the Treasury, Trading and Brokerage business line during the quarter. In the quarter, Barita produced NPAT of $999 million, $667 million (200%) higher than the prior year. This resulted from the aforementioned higher operating revenue, partially offset by a 26% or $346 million increase in operating expenses. Profit before taxation amounted to $1.3 billion, which was an improvement of $888 million or 207% relative to the prior year.
Shareholders’ equity closed the period at $35.5 billion, an increase of $71 million, marginally higher than the $35.4 billion outturn at the end of FY23. This was driven by an improvement of $734 million in the fair value reserve, offsetting the decline in retained earnings due to dividends declared and paid during the year. Our capital levels remain resilient, with capital adequacy of 25.45% compared to the FSC’s early warning level of 14%.
Investment Strategy & Capital Management: Our Outlook
The outlook for monetary policy continues to evolve over the course of the fourth quarter of FY24, transitioning from the tightening cycle that has dominated the past two years. Both the Bank of Jamaica (BoJ) and the Federal Reserve, along with other major Central Banks, have reduced their policy rates amidst a sustained moderation in inflation. This shift is expected to lay the groundwork for a more favourable investment environment in the coming quarters.
In the United States, recent economic indicators suggest that the cooling effect of tight monetary conditions has begun to take hold. Core PCE inflation has moderated to 2.7% from a pandemic peak of 5.7% in February 2022. Unemployment remained low at 4.1% in September but has attracted more focus from policymakers at the Federal Reserve given the upward trend since the beginning of 2024. The U.S. economy delivered solid GDP growth of 3.0% in the second quarter of 2024, exceeding expectations, but leading indicators continue to suggest potential weakness ahead. Against this backdrop, the Fed opted for a 50-basis point rate cut in September 2024, bringing the federal funds target range to 4.75%-5.00%. Markets have since priced in the expectation of further rate cuts as inflation trends towards the Fed’s 2% target.
Locally, Jamaica has seen similar progress. Annual headline inflation in Jamaica stood at 5.7% as of September 2024, back within the BoJ’s target range following the uptick in August to 6.5% due to the impact of Hurricane Beryl. Moreover, the BoJ’s recent cumulative reduction of its policy rate by 50 basis points to 6.50% during the quarter, reflects growing confidence that average inflation will remain within the target range in the near term, supported by stable domestic demand, a relatively stable exchange rate, and the continued moderation of global commodity prices. Jamaica’s economy remains resilient, albeit with moderating growth in key goods-producing and service sectors.
Looking ahead, we anticipate a further shift toward more expansionary monetary conditions, both locally and globally, which will likely enhance our ability to optimize our balance sheet and improve the net interest margin. As funding costs stabilize and earning assets continue to reprice upward, we expect to see a positive impact on our financial performance. Additionally, more favourable market conditions should provide increased opportunities for trading gains, and we foresee a gradual acceleration in deal-making activity, further boosting revenue growth.
However, we remain cognizant of the risks that persist in the global macroeconomic environment. Slowing growth in key global markets, coupled with geopolitical uncertainties and the impending election in the world’s largest economy, may introduce volatility that could impact our investment activities. Despite these headwinds, we continue to prioritize the diversification of our revenue streams, particularly through our alternative investment platform, which includes our real estate ventures that are poised to deliver significant returns in the medium to long term.
In this context, prudent capital management remains central to our strategy. We will continue to ensure strict compliance with regulatory requirements while maintaining the flexibility to capitalize on emerging opportunities. Through these efforts, we are confident in our ability to navigate the evolving economic landscape and deliver sustained value to our shareholders.
Mark Myers, Chairman Barita Investments Limited (“Barita” or “the Group”)
For More Information CLICK HERE
Businessuite Markets
iCreate Transitioning From A Digital And Creative Training Company To A Diversified Investment Holding Company Kintyre Holdings.
Businessuite Markets
First Rock Real Estate Investments Registers Net Loss For Three Months Ended September 2024, Driven Primarily By Unrealised Foreign Exchange Losses
First Rock Real Estate Investments Limited registered a net loss attributable to Ordinary Shareholders for the three months ended September 30, 2024, totalling US$674,536, which yielded an Earnings Per Share (EPS) of negative US$0.002. Net loss attributable to Ordinary Shareholders for the nine months ended September 30, 2024, totalled US$1,453,640, which yielded an Earnings Per Share (EPS) of negative US$0.005.
The results were driven primarily by unrealised foreign exchange losses on translation of foreign currency denominated liabilities, which amounted to US$72,034 for the three months ended September 30, 2024 and US$275,170 for the nine months ended September 30, 2024. Additionally, interest expense amounted to US$118,839 for the three months ended September 30, 2024 and US$524,340 for the nine months ended September 30, 2024.
The Group’s financial performance continues to reflect the impact of the ongoing high-interest rate environment in Jamaica, which exerts downward pressure on property values, resulting in lower Property Income relative to prior year. Property Income totalled US$49,056 for the three months ended September 30, 2024 and US$1,916,074 for the nine months ended September 30, 2024.
To mitigate the impact on the bottom line from reduced revenues, the Group managed to reduce its overall Administrative & General expenses by 20% to US$2,274,250 for the nine months ended September 30, 2024, compared to the same period in the prior year. This cost management effort is part of our ongoing strategy to mitigate the impact of reduced revenues on the bottom line.
Outlook
The Group’s ongoing commitment to strategic growth remains steadfast as we navigate the headwinds that obtain in today’s real estate environment. By continuing to execute on our portfolio rebalancing strategy, which focuses on acquiring high-yield, income-generating properties across Latin America and the wider Caribbean region, we have built a resilient foundation that supports sustainable growth.
During the quarter our subsidiary, FirstRock Capital Cayman, entered into an agreement to acquire a fully tenanted investment property in Grand Cayman. As the largest acquisition in our portfolio, this property is poised to notably enhance our rental income stream, reinforcing our expansion across the region. Alongside this achievement, our two KFC locations in Costa Rica continue to deliver stable rental income under longterm lease agreements, with plans underway for additional site developments.
Looking ahead, we remain optimistic about finalizing additional acquisitions across the region, with several promising opportunities in advanced stages of negotiation. The Group remains committed to unlocking value through strategic investments, which we believe will yield substantial long-term benefits to our stakeholders.
Norman Reid J.P. Chairman First Rock Real Estate Investments Limited
For More Information CLICK HERE
Edward Alexander Executive Chairman of tTech Limited announced that Simply Secure Limited increased its shareholding in tTech to 69.1%, representing 73,229,223 shares. The increased shareholding includes the purchase of 20,719,366 shares from Norman Chen and G. Christopher Reckord. The acquiring entity, Simply Secure Limited, is owned by Kevin Gordon and Rob Mayo-Smith. Messrs. Gordon and Mayo-Smith are also the owners of Simply Secure LLC, a Managed Security Services Provider based in Ft. Lauderdale, Florida.
The increased shareholding puts Simply Secure Limited over the 50% ownership threshold of the issued and outstanding ordinary shares of the company, requiring Simply Secure to extend an offer to all remaining tTech shareholders to purchase their shares subject to approval from the regulators. The tTech board will also provide an opinion on their view of the fairness of the offer price.
Norman Chen,
G. Christopher Reckord.
Following the sale of their shares, Messrs. Chen and Reckord will be resigning as Directors of tTech.
Chairman of the tTech Board, Edward Alexander, stated, “I would like to thank Norman and Chris for their service to tTech. Their contribution as executives and directors has enabled much of the success that tTech has enjoyed to date. We now look forward to the continued growth that is expected through the increased ownership in the company by Simply Secure.”
Who Is Mark Myers? Managing Director, Restaurants of Jamaica Ltd., and Chairman, Barita Investments Limited
Who Is Christopher Zacca President and CEO, Sagicor Group Jamaica Limited?
Who is Don Wehby, Group CEO of GraceKennedy?
Businessuite 2023 Top 100 Caribbean Companies – US$ Revenue
Which Company Has The More Sustainable Business Model….Edufocal or ICREATE and Why?
Jeffrey Hall Is Set To Be One Of The Most Powerful Men In Corporate Jamaica And The Caribbean. So, Who Is He?
JMMB Group Limited Investor Briefing – November 16, 2023
Jeffrey Hall Is Set To Be One Of The Most Powerful Men In Corporate Jamaica And The Caribbean. So, Who Is He?
A conversation with Marcel Anderson Group Chief Executive Officer and CTO at KYO Group on the disruption they are bringing to International Fast Cargo Transportation from the United States to Jamaica.
-
RANKING1 year agoBusinessuite 2023 Top 100 Caribbean Companies – US$ Revenue
-
Feedback & What You Think3 years ago
Which Company Has The More Sustainable Business Model….Edufocal or ICREATE and Why?
-
Entrepreneurship2 years ago
Jeffrey Hall Is Set To Be One Of The Most Powerful Men In Corporate Jamaica And The Caribbean. So, Who Is He?
-
Businessuite Women2 years agoJoanna A. Banks Was Set To Become The Youngest And Most Powerful Woman In Corporate Jamaica And The Caribbean
-
Marketing & Advertising2 years agoWill Oliver Mcintosh’s Verticast Media Group Acquire CVM TV From Michael Lee Chin? Part 1
-
Businessuite 50 Power and Influence2 years agoBusinessuite Women- Power and Influence 50 For 2023
-
RANKING1 year agoBusinessuite 2023 Top 50 Jamaica Main Market Companies – US$ Revenue
-
RANKING3 years ago
Businessuite 2021 Top 100 Caribbean Companies – US$ Revenue