JMMBGL reports 148% increase in first quarter net profit

August 16, 2021

JMMB Group Limited – (JMMBGL) for the three months ended June 30, 2021 booked Net interest income of $2.86 billion compared to $2.42 billion booked June 2020, an increase of 18%. Of this, Interest income grew by 17% to close at $6.39 billion, from the $5.46 billion booked in 2020, while interest expenses increased by 16% to total $3.53 billion relative to $3.04 billion in the prior year.

Fees and commission income for the quarter amounted to $957.01 million an increase of 33% from the $720.20 million recorded  for last year’s corresponding period. According to JMMBGL, This was due to “increased economic activity as well as significant growth in managed funds and collective investment schemes across the Group.” Foreign exchange margins from cambio trading recorded an increase of 10% year over year to close the quarter at $583.17 million (2020: $527.79 million), while net gains from securities trading showed an increase of 87% totalling $2.45 billion (2020: $1.31 billion). However, dividend income for the three months fell 9% to close at $16.62 million relative to $18.23 million in 2020’s first quarter.

As a result, operating revenue net of interest expense amounted to $6.86 billion (2020: $5.00 billion), the Company noted, “All of the major revenue line items increased, especially net interest income, trading gains and fees and commission income. This was facilitated by increased economic activity relative to the prior period as well as continued accommodative monetary policies in the countries in which we operate. Further, our clients continue to demonstrate confidence in the value of solutions and services which was evidenced by strong growth in the loan and investment portfolios.”

The Company recorded an impairment loss on financial assets of $241.64 million compared to $169.37 million for the same quarter of 2020.

Operating expenses amounted to $4.72 billion (2020: $3.71 billion), up 27% year over year. This led to an operating profit of $1.90 billion, an increase of 70% when compared to the $1.12 billion booked twelve months earlier.

Notably, other income declined 51% to $29,000 relative to $59,000 recorded the prior first quarter. Share of profit of associated company amounted to $318.66 million versus share of loss of $8.95 million booked in 2020. As such, pre-tax profit amounted to $2.22 billion (2020: $1.11 billion).

Following taxes of $289.48 million (2020: $328.51 million), JMMBGL booked a 148% increase in net profit to $1.93 billion compared to $780.21 million reported for the similar period of 2020.

Net profit attributable to the shareholders of the company totalled $1.71 billion relative to $769.32 million in 2020, an improvement of 123% year over year. Total comprehensive income for the quarter amounted to $3.04 billion (2020: $5.73 billion).

As a result, earnings per share (EPS) for the three months amounted to $0.88 (2020: $0.39). The twelve-month trailing EPS amounted to $4.32 where the number of shares used in the calculations amounted to 1,955,552,532 units. Notably, JMMBGL’s stock price closed trading on August 13, 2021 at $39.10 with a corresponding P/E of 9.05 times.


Balance Sheet at a glance:

Total assets as at June 30, 2021 amounted to $544.56 billion relative to $431.80 billion in 2020.  According to JMMBGL, “This was mainly on account of a larger loan and investment portfolio. Investment portfolio and loans and notes receivable grew by 9% and 6% to J$290.92 billion and J$127.13 billion, respectively. The credit quality of the loan portfolio continued to be comparable to international standards and we continue to maintain enhanced monitoring to mitigate against possible deterioration in credit quality.”

Shareholders’ equity totalled $62.70 billion (2020: $45.96 billion). As a result, book value per share stood at $32.06 (2020: $23.50).


Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.

Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.