Date: November 13, 2018

Reported in US$ (except where it is indicated otherwise)

Proven Investments Limited (PROVEN) for the six months ended September 30, 2018 booked net interest of $10.53 million, up from the $9.20 million documented in 2017. Of this, interest income totaled $14.17 million, a 3% increase when compared to the $13.77 million recorded in 2017. Interest expense declined 20% to total $3.64 million (2017: $4.57 million). Net interest income for quarter totaled $5.26 million, an increase of 12% relative to the prior year’s corresponding period amount of $4.68 million.

Net Foreign Exchange Gains for the period rose by 213% to $1.66 million (2017: $528,630). Dividend income amounted to $525,010 million, a 13% increase from the $465,653 recorded in 2017, while fees & commission income declined 23% to $2.07 million relative to $2.68 million in 2017. Other income moved from $1.16 million to $2.36 million for the period. Loss on securities trading fell closed six months period at $132,559 compared to a gain $2.47 million booked in 2017. The Company noted, “This decline was due to the continued realignment of the portfolio to reduce the overall market risk exposure and rightsizing of the balance sheet to reflect our outlook for financial markets over the short to medium term”. Notably, Proven recorded an increase in pension management income to $1.40 million, up from $1.09 million booked last year.

“Net Revenue” increased by 5% to total to $18.41 million relative to $17.59 million recorded for the corresponding period in 2017. However, for the second quarter, net revenue declined 4% to $9.91 million relative to $10.34 million in 2017.

Operating expenses climbed by 10% for the period to $12.09 million relative to $11.01 million in 2017. According to management, “The increase is mainly attributed to a 9.09% increase in administrative and general expenses, in addition to credit risk provisioning required under the IFRS 9 Accounting Standard.” Of this,

• Administrative and general expenses recorded a 9% increase to close at $10.26 million relative to $9.40 million documented for the prior year.
• ‘Depreciation and Amortization’ increased 3% to $884,391 (2017: $856,639)
• ‘Preference Share Dividend’ declined 15% to $646,443 (2016: $757,067).

Consequently, operating profit for the period and the quarter declined 4% and 22% respectively to $6.32 million (2016: $6.58 million) and $3.38 million (2017: $4.31 million) respectively.

Profit before tax amounted to $6.32 million versus a profit of $6.58 million booked in 2017.

Taxation decreased year over year by approximately 60% from $1.13 million to $452,039.  As such, net profit amounted to $5.87 million relative to $5.44 million in 2017. Proven booked second quarter profit of $3.04 million compared to $3.46 recorded for the comparable period in 2017.

Net Profit attributable to shareholders for the six months closed at $3.89 million (2017: $3.75 million), while profit attributable to shareholders for the quarter amounted to $2.12 million (2017: $2.62 million). The earnings per share (EPS) for the period totaled $0.62 cents (2017: $0.60 cents). The EPS for the quarter amounted to $0.49 cents 2017: $0.55 cents). The trailing twelve months EPS is 1.01 cents. The number of shares used in our calculations was 263,157,895. PROVEN last traded on November 12, 2018 at J$ 27.00 and US$0.23.

Balance Sheet at a glance:

Total Assets as at September 30, 2018 amounted to $533.25 million (2017: $604.50 million), a decrease of 12%. This decline resulted from a $67.19 million drop in ‘Available for Sale Investments’ to $335.93 million (2017: $403.12 million) and a $17.44 million decline in Cash and Cash Equivalents to $83.51 million (2017: $100.96 million).

Shareholders’ Equity totaled $82.37 million relative to $90.10 million in 2017, as such book value per share now amounts to $0.13 (2017: $0.14).

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