Date: July 30, 2020
QWI Investments Limited, for the nine months ended June 2020, reported losses from investment activities of $521.86 million. For the quarter, gain from investment activities of $100.44 million (2019: $120.97 million).
Unrealized currency translation and dividend income closed the period under review at $8.26 million and $19.74 million, respectively. While, for the quarter, unrealized currency translation amounted to $24.13 million (2019: nil), whereas, dividend income closed at $4.32 million (2019: $1.73 million).
Administrative and other expenses amounted to $31.58 million, while interest expenses totaled $14.28 million. However, for the quarter ended June 2020, administrative expenses fell to close at $10.48 million (2019: $14.56 million). Interest expenses, for the quarter, declined totaling $2.48 million (2019: $2.52 million). The Company stated that, “The Company’s main expenses in the period were management fees paid to Jamaican Teas Ltd and interest expense on the company’s borrowings. These expenses were more than offset by a $24 million foreign exchange translation gain in the quarter.”
As such, loss before taxation year to date closed at $539.71 million. For the quarter, QWI posted profit before taxation of $115.94 million (2019: $105.62 million). QWI noted that, “This loss arose primarily as a result of unrealised losses on the Jamaican portfolio of $527 million and $11 million on the overseas portfolios. The unrealised losses on the Jamaican share portfolio year to date primarily reflect the decline in the value of the company’s holding in Access Financial Services in the first quarter of the year followed by a broader based decline, primarily in our holdings of other financial companies, in the second quarter.”
In addition, Management highlighted that, “The unrealised losses mentioned above were partially offset by realised gains of almost $17 million on sales of investments. The Company’s USA share portfolio produced $24 million of these realised gains while in the Jamaican share portfolio realised losses stand at $8 million. Dividend income earned amounted to $18 million.”
Year to date, QWI recorded tax credit of $78.66 million, thus resulting in loss for the period under review of $461.05 million. Notably, for the quarter, QWI recorded profit for the period of $115.36 million versus $105.36 million reported as at June 2019.
Loss per share for the period amounted to $0.34 for the nine months ended June 30, 2020, while the EPS for the third quarter was $0.08 (2019: $0.08). The trailing twelve months LPS is $0.24. The total shares outstanding used for this calculation was 1,365,000,015. Additionally, QWI closed the trading the period on July 29, 2020 at a price of $0.69.
Balance Sheet at a Glance:
As at June 30, 2020, total assets closed at $1.49 billion (2019: $732.70 million), a 104% increase. Of this increase, quoted investments (local) grew by 55% closing at $1.13 billion (2019: $732.30 million). In addition, quoted investments (overseas) and other receivables contributed to the increase amounting to $265.30 million (2019: nil) and $84.51 million (2019: nil), respectively.
The total equity as at June 30, 2020 amounted to $1.41 billion (2019: $579.15 million). This resulted in a net asset value per share of $1.03 (2019: $0.42).
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