November 16, 2020
Fees and commission income for the period amounted to $1.52 billion, a decrease of 5% on the $1.59 billion recorded for last year’s corresponding period. According to the company, this was because, “lower business activity was partially offset by significant growth in managed funds and collective investment schemes across the Group.” Foreign exchange margins from cambio trading recorded a decrease of 30% year over year to close the period at $1.07 billion (2019: $1.53 billion). While net gains from securities trading showed a decrease of 19% totalling $3.20 billion (2019: $3.95 billion). Whereas, dividend income for the period rose 10% to close at $23.28 million (2019: $21.19 million).
Operating revenue net of interest expense for the six months fell 8% to $10.80 billion versus $11.71 billion in 2019. For the quarter, operating revenue net of interest expense also decreased 1% to close at $5.80 billion in contrast to the $5.87 billion recorded in 2019. According to Management, “the operating environment was markedly different given the pandemic. In the prior period, market sentiment was bullish and we successfully identified and capitalized on trading activities. Nevertheless, our clients continued to demonstrate confidence in the value of products and services which was evidenced by strong growth in the loan and investment portfolios.”
JMMBGL recorded an impairment loss on financial assets of $372.32 million, up 26% from the $295.27 million booked for the same period in 2019.
Operating expenses amounted to $7.53 billion, a year over year decrease of 2% (2019: $7.70 billion) which led to an operating profit of $3.26 billion, a decline when compared to the $4.01 billion booked the year prior. According to JMMBGL, “Given reduced business activity, we implemented a cost containment program while prioritizing our efficiency related projects. The Group will continue to focus on extracting operational efficiency from all entities through the launch of its standardization and process improvements project.”
Other income booked for the period rose to $2.38 million relative to the $216,000 reported for the corresponding period in 2019. JMMBGL also booked share of loss of associate of $106.97 million (2019: nil) for the period under review. Management noted, “while our share of profits from SFC is currently adversely impacted by the pandemic resulting in our share of losses of J$106.9 million for the six-month period, we remain confident about the long term returns on this investment. The results were primarily related to US operations which had higher Expected Credit Losses (ECLs) and adverse change in the actuarial adjustments due to the pandemic.”
As such, the JMMBGL booked profit before taxation of $3.16 billion for the period, 21% less than the $4.01 billion recorded in 2019.
Following taxes of $740.85 million (2019: $1.21 billion), JMMBGL booked a 14% decrease in net profit to $2.41 billion compared to $2.80 billion reported for the similar period of 2019. Net profit for the quarter totalled $1.64 billion, a 3% decrease compared to $1.68 billion recorded in 2019.
Net profit attributable to the shareholders of the company totalled $2.34 billion relative to $2.72 billion in 2019, a 14% decrease year over year. Net profit attributable to the shareholders of the company for the quarter totalled $1.57 billion, 3% less than $1.61 billion in 2019.
Total comprehensive income attributable to Shareholders for the six months amounted to $9.75 billion (2019: $7.85 billion). While for the quarter, total comprehensive income attributable to Shareholders for amounted to $4.02 billion (2019: $5.13 billion).
As a result, earnings per share (EPS) for the six months amounted to $1.20 (2019: $1.39), while for the EPS for the quarter was $0.80 (2019: $0.82).The twelve month trailing EPS amounted to $3.38 where the number of shares used in the calculations amounted to 1,630,552,530 units. Notably, JMMBGL’s stock price closed trading on November 13, 2020 at $31.89.
Balance Sheet at a glance:
Total assets as at September 30, 2020 amounted to $466.65 billion relative to $391.68 billion in 2019. This was mainly attributable to loans and notes receivable which amounted to $111 billion (2019: $83.94 billion).
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