February 15, 2021
JMMB Group Limited (JMMBGL) for the nine months ended December 31, 2020 recorded net interest income of 7.58 billion, an 8% increase when compared with $7.02 billion recorded for the corresponding period in 2019. Interest expenses increased 20% to total $9.24 billion relative to the $7.72 billion recorded for the same period in 2019.Net interest income for the quarter amounted to $2.60 billion, an 8% increase when compared with the $2.40 billion recorded for the same period in 2019.
Fees and commission income for the period amounted to $2.36 billion, a 3% decline on the $2.43 billion recorded last year.
Net gains from securities trading showed a decline of 13%, to total $4.94 billion (2019: $5.65 billion). While for the quarter, net gains from securities trading closed at $1.75 billion (2019: $1.70 billion). 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.”
Dividend income for the nine months surged 141% to close at $89.65 million relative to $37.27 million recorded for the same period in 2019. Foreign exchange margins from cambio trading fell 31%, totalling $1.57 billion (2019: $2.26 billion).
Operating expenses amounted to $10.66 billion, a 5% decline (2019: $11.21 billion) which led to an operating profit of $5.14 billion, an 11% decline when compared to the $5.79 billion booked the year prior. The Company noted, “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.”
JMMBGL recorded an impairment loss on financial assets of $741.79 million (2019: $398.89 million) and other income of $9.22 million (2019: $260,000).
Share of loss of associate for the period amounted to $106.97 million (2019: nil). This resulted in a profit before taxation amount of $5.04 billion, an 11% decline relative to the $5.79 billion recorded for the corresponding period in 2019.
Consequently, JMMBGL booked an increase in net profit for the period to total $4.02 billion compared to $4 billion reported for the similar period of 2019. Net profit for the quarter amounted to $1.61 billion, a 34% improvement relative to the $1.20 billion reported for the same period 2019.
Net profit attributable to the shareholders of the company totalled $3.85 billion relative to $3.93 billion in 2019, a 2% decline year over year. For the quarter, JMMBGL booked net profit attributable to shareholders of $1.51 billion relative to $1.20 billion reported for the corresponding quarter of 2019
As a result, earnings per share (EPS) for the nine months amounted to $1.97 (2019: $2.01) while EPS for the quarter amounted to $0.77 (2019: $0.61). The twelve-month trailing EPS amounted to $3.54 where the number of shares used in the calculations amounted to 1,955,552,532 units. Notably, JMMBGL’s stock price closed trading on February 12, 2021 at $32.30 with a corresponding P/E ratio of 9.13 times.
Management noted, “JMMB Group (the Group) continues to perform credibly within the context of the COVID-19 pandemic having recorded quarter over quarter growth and profitability for the financial year thus far. The Group customized COVID strategy, which focused on the protection of client goals, business continuity and acutely managing capital, liquidity and expenses, has yielded success.”
Balance Sheet at a glance:
Total assets as at December 31, 2020 amounted to $489.24 billion relative to $412.99 billion in 2019. According to JMMBGL, “This was mainly on account of a larger loan and investment portfolio as well as a larger liquidity buffer. Investment portfolio and loans and notes receivable grew by 30% and 17% to J$257.26 billion and J$115.92 billion, respectively. Growth in the asset base over the nine-month period was funded by increases in customer deposits and repos. Customer deposits increased by J$16.80 billion or 16% to J$120.98 billion, while repos grew by J$45.89 billion or 26% to J$225.48 billion”
Shareholders ‘equity totalled $59.50 billion (2019: $50.21 billion). As a result, book value per share stood at $30.43 (2019: $25.68).
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