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Sagicor Group Jamaica Individual Life Insurance Segment Continues To Lead Group’s Profit Generation, Accounting For $8.74B In Reported Net Profit For FY2022.

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Christopher Zacca, President & CEO of Sagicor Group Jamaica Limited (SGJ or the Group) has released the following report to shareholders on the Group performance report for the year ended December 2022.

Overview
Sagicor Group Jamaica achieved net profit attributable to stockholders of $16.38 billion for the year ended December 31, 2022, a 6% reduction over the prior year but a creditable performance in a difficult year.

The Individual Life insurance segment continues to lead the Group’s profit generation, accounting for $8.74 billion in reported net profit.

The Employee Benefits and the Commercial Banking segments were also major contributors, with $4.05 billion and $3.29 billion, respectively.

The Group ended the year with earnings per share of $4.19 (December 2021: $4.46). The 2022 year-end saw the stock price closing at $59.42, an increase over prior year (December 2021: $58.25). The Group’s market capitalization ended the year at $232.07 billion, the largest of any company on the Jamaica Stock Exchange.

2022 was an extremely challenging year characterised by volatility in local and international financial markets emanating from geopolitical tensions, rising inflation, tightening of monetary policies and supply chain disruptions. Notwithstanding these challenges, Sagicor Group Jamaica continues to strategically position itself for growth by optimising our operations and transforming our business processes. In the final quarter of 2022, the Group announced a series of management changes to implement these plans. During the year the Group also entered the Cambio and Remittance market through the acquisition of Alliance Financial Services Limited and disposed of its shareholdings in Sagicor Real Estate X Fund.

The Group declared dividends totalling $1.60 per share (December 2021: $1.11 per share) during the year as part of our commitment to providing a return on capital to our shareholders, in spite of the challenging environment.

Financial Performance
Total revenue for 2022 for the Group was $97.10 billion, a 5.3% decline year over year. The Group recognized fair value losses of $3.31 billion (December 2021: $8.97 billion in gains); a result of depressed market prices for fixed income and equity securities. Sagicor’s main revenue streams were net premium revenue, net investment income and fee income. Net premium revenue improved over prior year by 7.1% to contribute $56.55 billion, a result of strong new business and policy retention. Net investment income grew by 10.7% over prior year amounting to $21.30 billion, emanating from growth in the loan portfolio and commercial banking activities. Fees and other income recorded improved results over prior year by 6.4% to close the year at $18.51 billion. This was driven mainly by income from cambio and remittance services as well as an increase in commercial banking fee income.

Total benefits and expenses for the Group decreased year over year by 3.1%, ending at a total of $75.87 billion. An upward movement in prevailing market interest rates resulted in a favourable net movement in actuarial liabilities of $8.12 billion. This was partially offset by net insurance benefits incurred and administrative expenses increasing by $2.08 billion and $3.72 billion, respectively year over year.

The Group’s statement of financial position was impacted by the sale of Sagicor Real Estate X Fund and the softening of asset prices. Total Assets and Shareholders Equity ended at $519.18 billion and $113.87 billion, respectively. The Group’s Funds under Management of $456.89 billion grew nominally year on year, contributing to the Total assets under Management of $976.07 billion, an increase over prior year (December 2021: $956.30 billion). Sagicor Group’s annualized return on equity was 14% (down from 16% in the corresponding period in 2021).

Individual Insurance
The Individual Life segment ended the period with $8.74 billion in net profit, a 2.4% decline over prior year. Net premium income grew year over year by $2.16 billion across Jamaica and the Cayman Islands, as a result of new business sales growth and policy retention. In the current year, actuarial liabilities were primarily impacted by changes to discount rates, a result of the prevailing market conditions. The prior year period included adjustments to the morbidity and lapse experience.

Employee Benefits
The Employee Benefits segment produced profits of $4.05 billion, 10.5% above prior year. Net group health premium income of $12.32 billion increased by 13.2% over the prior year, due to new business written during the period, particularly the acquisition of a large client in the Group Health portfolio. Net insurance benefits incurred increased by $1.77 billion, as medical inflation continued to trend upward, however, this was partially offset by a reduction in actuarial liabilities for the period.

Commercial Banking
The Commercial Banking segment produced a net profit of $3.29 billion, 1% higher than the prior year. The segment was aided by a 10.5% increase in total revenues, primarily due to increases in banking activities through credit card and point of sale transactions.

Additionally, a 17% growth in the segment’s loans portfolio translated to 14% or $1.52 billion increase in interest income.

Total assets of $191.8 billion grew 9.1% over December 2021. This growth was driven by a $15.47 billion increase in loan assets which ended the period at $108.49 billion. Customer deposits increased by $12.5 billion against the prior year end to total $148.9 billion as at December 2022.

Investment Banking
The Investment Banking segment’s net profit outturn was $1.20 billion, a decline of 64.2% against prior year. The prevailing macroeconomic conditions have caused a significant reduction in business transactions, adversely affecting performance.

Notwithstanding, the segment benefitted from our recently formed Cayman subsidiary, which grew its interest earnings asset base by 95% and positioned itself to benefit from higher yielding securities within the market.

Liquidity And Solvency
Cash and Cash Equivalents at the end of December 2022 were $42.94 billion, down from $51.88 billion as at December 2021. Regulatory capital requirements continue to be exceeded across all operating entities.

Outlook
As we come to the close of an undoubtedly challenging year, our outlook for 2023 remains conservative as many of the constraining factors to economic growth remain in place, namely inflation, the war in Ukraine and the lagging effect of high interest rates, causing the World Bank to issue a downward revision in global economic growth from 3% to 1.7%. We expect a continued slowing of growth amongst our key trading partners, including the United States and Britain, as consumer spending and market activity responds to the extended period of high interest rates. Domestically, we anticipate the Bank of Jamaica will remain focused on taming inflation, but indications are
that its recent market actions have been effective given the downward trajectory of this key measure.

The Group is cognizant of and well prepared for the potential impact of International Financial Reporting Standard (“IFRS”) 17. The standard which becomes effective January 1, 2023, replacing IFRS 4, is anticipated to materially change the recognition and measurement requirements for our insurance business segments, as well as the presentation and disclosures in the Group’s Consolidated Financial Statements.

For more information CLICK HERE

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Sygnus Real Estate Finance Strategically Increases Stake In One Belmont From 70% To 86%

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Results of Operations

SRF continued the transition between its first and second investment life cycles with a number of key initiatives, namely:

  • Strategically increased its stake in the 9-storey One Belmont commercial tower asset from 70% to 86%;
  • Increased its investment in income generating third-party real estate investment notes (REINs) by 25.3% to J$2.30 billion; exited J$1.72 billion of investments;
  • Paid its first dividend of J$0.2012 per ordinary share in December 2024.

Primarily as a result of the increased stake in One Belmont, SRF generated a net profit for Q2 2025 versus a loss in the similar period last year, and a lower loss for 6 Months FY 2025 versus the similar period last year.

Book value per share increased 5.0% to J$24.05 compared to J$22.91 last year, given a J$372.06 million or 13.5% increase in retained earnings to J$3.13 billion as at the end of the period.

SRF continued to advance the ongoing execution of interior build-out works for some tenants of the One Belmont property, and the monetization of its partial exit from the One Belmont investment; and advancing the value creation process for the Mammee Bay hospitality asset in St. Ann and the Lakespen industrial asset in St. Catherine.

The Group remains dedicated to executing its strategy of unlocking value in real estate assets to enhance shareholder value.

For Q2 2025, total investment income or core revenues was J$152.25 million compared to negative J$24.35 million for the three months ended February 29, 2024 (“Q2 2024”). While total investment income or core revenues was J$26.59 million for 6 Month FY 2025 compared to negative J$55.31 million for the six months ended February 29, 2024 (“6 Month FY 2024”). This was primarily due to increased lease and other income, a gain on disposal of financial instruments of J$33.73 million, a gain on acquisition of shares in Joint Venture of J$162.20 million, and share of gain on joint ventures of J$39.26 million. The gain on acquisition of shares in Joint Venture resulted from SRF’s strategic decision to increase its exposure to the One Belmont commercial tower. On a net basis, SRF’s overall income from this asset was J$209.95 million for 6 Month FY 2025.

The weighted average fair value yield on REINs was 8.7% compared with 4.3% last year, with the weighted average yield on REINs measured at amortised cost being 14.4% vs 13.5% last year. The increases noted were due to the redeployment of capital into higher yielding real estate investment notes. The weighted average fair value yield on REINs is expected to improve significantly during the current financial year as SRF continues to substantially increase its exposure into third-party income-generating assets.

The weighted average cost of debt was 9.0% compared with 7.6% last year. This result was due to a higher interest rate environment as well as SRF securing longer duration debt. One of the tranches of SRF’s 2024 capital raise has a variable interest rate structure, which becomes effective after the first year which SRF expects to benefit from as market interest rates move downwards.

The share of gain on joint ventures amounted to J$15.63 million for the quarter ending February 28, 2025, compared to a nominal loss of J$0.51 million last year, while the share of gain on joint ventures was J$39.26 million for 6 Month FY 2025 compared to a loss of J$0.81 million last year. This was mainly driven by SRF’s increased ownership stake of 86% of the Audere Holdings Limited joint venture and SRF’s 71.0% ownership in the newly formed joint venture company referred to as 5658 LMR Limited, whose underlying assets are two (2) resort villa properties located in Ocho Rios, Saint Ann.

SRF’s total investment income consisted of various activities aimed at unlocking value from its real estate investment portfolio, namely: interest income, lease income and commitment fees related to REINs; gain or loss on property investments or on exited real estate assets; and share of gain or loss on its joint venture investments.

Due to the nature of its business model, SRF may experience fluctuations or “lumpiness” in total investment income and net profits during interim reporting periods, which usually stabilizes by the end of each financial year, as evidenced by the FYE Aug 2024 results relative to the interim quarterly performance. The Group uses independent appraisers to value its investment assets annually. All investment properties are USD investment assets which are converted to JMD for financial reporting purposes. SRF’s key strategic assets are held via wholly owned subsidiaries or joint ventures.

For the three months ended February 28, 2025, net investment income or core earnings was J$66.75 million versus negative J$113.22 million last year. While for the six months ended February 28, 2025, net investment income or core earnings was negative J$160.21 million versus negative J$228.10 million last year. The increase recorded during the quarter was mainly attributable to SRF’s gain on its acquisition of additional shares in Audere Holdings Limited, increasing its stake in the joint venture from 70% to 86%. For FYE August 2024, SRF generated J$508.50 million in net investment income.

Net profit for Q2 2025 amounted to J$38.24 million relative to a loss of J$187.15 million last year, while net loss for 6 Month FY 2025 amounted to J$197.45 million vs a loss of J$320.13 million in the corresponding period last year. The improvement for both periods was mainly due to gains on investments executed during the quarter. SRF generated an average annual return on equity (ROE) of 19.1% over the past five years of its first investment life cycle through the end August 2024.

Basic earnings per share (EPS) was J$0.12 for Q2 2025 relative to negative J$0.57 last year, while diluted EPS was identical to basic compared to negative J$0.53 last year.

Basic earnings per share (EPS) was negative J$0.60 for 6 Month FY 2025 relative to negative J$0.98 last year, while diluted EPS was identical to basic compared to negative J$0.91 last year.

Similarly, basic core earnings or net investment income per share (NIIPS) was J$0.20 for Q2 2025, compared with negative J$0.35 last year. For 6 Month FY 2025, basic core earnings or net investment income per share (NIIPS) was negative J$0.49, compared with negative J$0.70 last year.

Dr. Ike Johnson Director Sygnus Real Estate Finance Limited 

For More Information on Sygnus Real Estate Finance Limited (SRF) Unaudited Financial Statements Quarter Ended February 28, 2025(Q2-2025) CLICK HERE

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Express Catering’s Outlook Is For An Excellent Summer Season

The winter season is now ending but the outlook is for an excellent summer season and we are ready to serve our many patrons.

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Ian Dear CEO and Director Of Express Catering Limited (ECL) Has Released The Following Third Quarter Interim Report On The Operations Of The Company For Fiscal 2025. The Report Is For The Quarter And Nine Months Ending February 28, 2025.

Total passengers accessing the post security departure lounge of the Sangster International Airport during the Third Quarter was 652,656. This generated revenue of US$7.43 million for a spend rate per passenger of US11.38.

For the similar Quarter in the prior year, 705,116 passengers accessed the departure lounge. Total revenue of US$7.04 million was earned at a spend rate per passenger of US$10.05.

Despite the decline in passenger totals, total revenue and spend rate improved. The improvement in spend rate is particularly important as the increase was significant and is a result of the strategic measures that the company has been implementing over time.

Net profit earned for the Quarter was US$1.77 million for an EPS of 0.108 US Cents per share. This is compared to a net profit of US$1.06 million for an EPS of 0.065 US Cents for the similar period in the prior year.

For the nine months to date, the passenger total was 1.80 million. This generated revenue of US$18.89 million for a spend per passenger rate of US$10.49. The metrics for the similar nine months in the prior year were passenger total of 1.96 million passengers, revenue of US$18.67 million and spend rate of US$9.53.

Net profit for the nine months was US$3.22 million for an EPS of 0.197 US Cents. Net profit earned for the similar period in the prior year was US$2.09 million, for an EPS of 0.127 US Cents. Dividend declared and paid for the fiscal year to date was just over US$1.00 million.

Of all the cost categories, Cost of Sales (COS) continues to be our best area of savings for the Quarter and year-to-date positions.  This category registered just under seven percentage points improvement for the Quarter and just under five percentage points improvement for the nine months. The improvement was a combination of price increases, better portion controls, as well as improved supply chain agreements. The team intends to build on the trend for the rest of the year.

Savings were also recorded in Salaries and Wages, in line with the previously stated intention to better utilize this resource. There was also a shift in cost allocation from property rental expenses to lease amortization, in line with the increase in Lease Obligation under IFRS 16 rules. The team continues to review all cost categories for additional savings.

The winter season is now ending but the outlook is for an excellent summer season and we are ready to serve our many patrons.

For More Information CLICK HERE

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Knutsford Express Charts Strategic Course Amid Profit Decline and Operational Investments​

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Knutsford Express Services Limited (KEX) has released its unaudited financial statements for the third quarter ended February 28, 2025, revealing a nuanced financial landscape. While the company experienced a modest revenue uptick, net profits have seen a significant decline, prompting strategic shifts in operations and investments.​

Financial Performance Overview

For the third quarter, KEX reported revenues of J$593 million, marking a 4.8% increase from J$566 million in the same period last year. Over the nine-month period, revenues rose by 7.3%, reaching J$1.643 billion compared to J$1.531 billion previously.

Despite these gains, net profit for the quarter plummeted by 54.9% to J$49 million, down from J$111 million in 2024. The nine-month net profit also declined by 36.8%, settling at J$170 million from J$269 million in the comparative period.​

The company attributes the profit downturn to lingering effects of subdued passenger arrival numbers in Jamaica. Additionally, increased administrative expenses, particularly in staff costs, have impacted profitability. In the first quarter of 2025, administrative expenses rose to J$520 million, affecting net profits despite a revenue increase to J$592 million.

Strategic Investments and Operational Enhancements

In response to these challenges, KEX is investing heavily in fleet expansion and digital transformation. The company plans to inject J$500 million over the next three years to upgrade its bus fleet and implement advanced digital systems . This includes the introduction of airport-style departure gateways and digital ticket-checking kiosks, aimed at enhancing operational efficiency and customer experience.​

The Drax Hall depot in St. Ann has become a focal point for these innovations, serving as a prototype for the new passenger processing model. CEO Oliver Townsend emphasized the importance of these investments, stating, “We’re redoubling our investments and efforts on the core business and on initiatives that will improve our customer’s satisfaction”

Service Portfolio Adjustments

KEX is also refining its service offerings to align with market demands. The company announced the discontinuation of its international shipping and e-commerce service effective October 7, 2024, due to a 10% decline in revenue from overseas courier services . This strategic move allows KEX to focus on its core transportation and local courier services, which continue to be significant revenue streams.

Outlook

Despite current profitability challenges, KEX maintains a strong asset base, which grew by over 10.7% in the third quarter, reaching J$2.113 billion from J$1.926 billion the previous year. The company’s commitment to enhancing operational efficiency and customer satisfaction positions it for potential recovery and growth as market conditions improve.​

Conclusion

Knutsford Express is navigating a complex financial environment with strategic investments in infrastructure and technology. By focusing on core services and operational excellence, the company aims to bolster its market position and return to robust profitability in the coming periods.

For More Information CLICK HERE

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One on One Educational Services remains focused on strengthening One Academy

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Michael Bernard Chairman One on One Educational Services Limited has released the following unaudited financial statements for the 2nd quarter ended February 29, 2025.

Statement of Comprehensive Income Summary: 

Over the six months ending February 2025, company revenue was J$169.9 million, up from J$111.4 million for the six months ended February 2024. This represents a 52.5% increase over the comparative period, primarily due to the expansion of One Academy, which provides personalized educational solutions for schools, teachers and students. Additionally, the company retained its core annual recurring business from existing contracts, further strengthening revenue growth.

For the second quarter of 2025, revenue reached J$78.0 million, reflecting a 37.6% increase over the same period in the prior year. This growth was attributed to the expansion of One Academy and its ability to deliver personalized solutions through advanced technology, enhancing the accessibility and effectiveness of digital education.

Direct costs for the second quarter amounted to J$22.5 million, an increase of J$4.5 million compared to the previous year. This resulted in a gross profit of J$55.5 million, up 43.5% yearover-year. The increase in direct costs was primarily driven by expenditures related to One Academy’s live streaming of classes across the island  from the company’s central studio. Over the six-month period, direct costs also saw a 45.3% uptick due to one off investments in hosting infrastructure services and the installation of equipment and accessories to facilitate One Academy’s implementation of live classes. While these expenses have contributed to short-term cost increases, they are a strategic investment aimed at driving long-term value creation.

Administrative and selling expenses decreased by J$24.2 million, or 21.5%, over the six-month period, while the second quarter recorded a 19% decline over the comparable 2024 quarter. This reflects the benefits of cost-cutting initiatives aimed at improving operational efficiencies and financial discipline.

A taxation charge of J$226 thousand was recognized for the second quarter, primarily due to deferred taxation, bringing the six-month tax charge to J$894 thousand. The quarter closed with a net profit of J$7.2 million, a significant improvement compared to the net loss of J$19.9 million recorded in the same quarter last year. For the six-month period, net profit reached J$18.4 million, a strong turnaround from the J$41.4 million net loss over the comparative period.

Statement of Financial Position Summary:

Total assets grew to J$662.6 million at the end of the six-month period, reflecting an 8.2% increase from J$612.3 million in the prior year. This growth was primarily driven by investments in non-current assets, particularly the development of intangible assets. Total equity also strengthened, rising to J$423.4 million from J$362.6 million, supported by the company’s improved financial performance. This shift has allowed the company to move from an accumulated deficit of J$51 million to an accumulated surplus of J$9.5 million compared to the previous year. While, total liabilities reduced marginally by 3% year over year.

Statement of Cash Flow Summary:

The cash flow summary for the second quarter of 2025 highlights a substantial improvement in financial performance compared to the same period in 2024. Operating activities generated J$121.5 million in cash flow, while investing activities had reduced outflows. Additionally, financing activities reflected the company’s efforts to pay down loan obligations. These factors contributed to a net cash increase of J$66.7 million, leading to a stronger closing cash balance of J$110.0 million. This improvement underscores the company’s enhanced cash flow management and liquidity position.

During the quarter, the company remained focused on strengthening its One Academy suite of product offerings. This included the continued live streaming of lessons into high schools in Jamaica. Furthermore, the company leveraged its personalized solutions by developing a testing mechanism that allows schools to assess student performance effectively. This solution empowers schools with comprehensive student assessments, enabling the creation of targeted intervention strategies to improve learning outcomes.

In addition, investments continued in enhancing software architecture, particularly the further development of the integrated Education Management Information System (EMIS) and Learning Management System (LMS). These strategic initiatives reinforce the company’s commitment to advancing education delivery through technology, fostering impactful and accessible learning solutions.

These results reflect the company’s commitment to financial sustainability and operational efficiency while positioning itself for continued expansion and long-term success

For More Information CLICK HERE

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JSE launches Green Bond Plus Platform

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