November 14, 2023

Eppley Limited (EPLY) for the nine months ended September 30, 2023, reported a 5% decrease in Interest Income totaling $316.59 million compared to $331.72 million in the corresponding period last year. Interest Income for the third quarter experienced an 8% decrease to close at $98.05 million compared to $106.36 million for the comparable quarter of 2022.

Interest Expense amounted to $226.08 million (2022: $219.78 million), this represents an increase of 3% year over year. Consequently, net interest income decreased by 19% to $90.51 million compared to $111.94 million for the nine months. The company booked net interest income of $21.27 million for the third quarter versus $30.23 million reported for the similar quarter of 2022.

“Net interest income fell mainly due to repayments of loans and factoring facilities during the period coupled with higher interest expenses prior to maturity of the $300 million preference shares in the quarter”, according to EPLY.

Asset management fee income increased by 20% to close at $226.05 million (2022: $187.74 million). Other operating income for the nine months amounted to $135.57 million, a 142% increase relative to $56.01 million reported in 2022.

The Company recorded a gain on bargain purchase of $229.59 million for the nine-month period relative to nil in the prior year. EPLY noted this was from the acquisition of the Eppley Caribbean Property Fund-Development Fund shares.

Administrative expenses for the nine months amounted to $232.90 million, a 38% increase relative to $168.53 million reported in 2022. Net impairment losses of financial and contracts assets totalled $439,000, a 493% increase from the corresponding period last year. (2022: $74,000).

Profit Before Tax for the nine months amounted to $463.81 million, a 144% increase relative to $190.24 million reported in 2022. Profit Before Tax for the third quarter amounted to $98.20 million (2022: $77.71 million).

Taxation for the nine months had a 496% decline to reach $20.97 million (2022: $3.52 million). Net Profit for the nine months amounted to $442.84 million, a 137% increase from the $186.72 million reported in 2022. For the third quarter, Net Profit was $91.33 million (2022: $76.75 million).

EPLY highlighted, “Our profit after tax attributable to shareholders for the first nine months of 2023 was $443 million when compared against $187 million generated for the similar period of last year. This is the highest profit Eppley has ever recorded.”

Consequently, Earnings Per Share for the nine months amounted to $2.30 (2022: EPS: $0.97), while Earnings Per Share for the quarter totaled $0.47 (2022: EPS: $0.40). The twelve-month trailing EPS was $2.57, and the number of shares used in these calculations was 192,468,300.

Notably, EPLY’s stock price closed the trading period on November 13, 2023, at a price of $34.00 with a corresponding P/E ratio of 13.22x.

Balance Sheet Highlights

The company’s assets totalled $6.59 billion (2022: $5.52 billion). This resulted mainly from ‘real estate available-for-sale’ of $703.69 million being recorded relative to nil in the prior year.

Shareholder’s equity was $1.32 billion (2022: $1.06 billion), representing a book value per share of $6.84 (2022: $5.48).

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