May 17, 2024
VM Investments Limited (VMIL) for the first quarter ended March 31, 2024, reported a 14% increase in interest income totalling $432.13 million compared to $378.01 million in the corresponding three months last year.
Interest Expense amounted to $400.74 million (2023: $286.38 million), this represents an increase of 40% year over year.
Consequently, net interest income decreased by 66% to $31.40 million compared to $91.63 million for the first quarter ended March 31, 2023. VMIL noted this was due to, “our deliberate capital management policy to contain the growth of our repo portfolio, but also compression of spreads due to the tight monetary policy of higher interest rates.”
Gains from investment activities were boosted by 594%, due to the sale of VMIL’s equity interest in Carilend Caribbean Holdings Limited, closing at $686.77 million (2023: $98.90 million). VMIL noted, “In the first quarter of the financial year, VMIL made significant strides in executing strategic initiatives geared at promoting sustainable growth. One of these included the sale of VMIL’s 30% stake in Carilend Caribbean Holdings Limited in March 2024. Carilend, which was acquired in 2019, is a fintech company that services the Caribbean region, offering a digital lending platform. The shareholding in Carilend was acquired by the VM Financial Group and this transaction had a positive impact on the gains from investment activities.”
Net fees and commissions decreased by 22% from $233.99 million in 2023 to $181.54 million stemming from lower investor confidence and reduced market participation. Other operating revenue for the first quarter amounted to $880.54 million, a 153% increase relative to $347.89 million reported in 2023.
Net interest income and other operating revenue for the three months amounted to $911.94 million, a 107% increase relative to $439.52 million reported in 2023. Operating profit totalled $441.55 million relative to a loss of $5.25 million a year prior.
Profit before taxation for the first quarter amounted to $456.24 million, a 1811% jump relative to $23.87 million reported in 2023.
Taxation credit for the three months was $53.97 million (2023: Taxation charge: $3.96 million).
Net Profit for the three months amounted to $510.21 million, a 2462% jump from the $19.92 million reported in 2023. VMIL highlighted this is “the highest quarterly profit in the history of VMIL.”
Consequently, Earnings Per Share for the three months amounted to $0.34 (2023: EPS: $0.01).
Notably, VMIL’s stock price closed the trading period on May 16, 2024, at a price of $2.72.
Balance Sheet Highlights
The company’s assets totalled $30.08 billion (2023: $28.94 billion). The Company noted, “this was predominately driven by increases in the value of our resale agreements, loan balance and investment in associates of $1.76 billion and $5.21 billion and $1.72 billion, respectively.”
Shareholder’s equity was $2.97 billion (2023: $3.00 billion), representing a book value per share of $1.98 (2023: $2.00).
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