May 18, 2020
Sagicor Select Fund Manufacturing & Distribution (SELECTMD) for the three months ended March 31, 2020 reported net investment loss of $1.08 billion.
Fees and other income closed the three months period at $18,000.
As such, total loss for the period under review equated $1.08 billion. The Company highlighted, this was “largely attributable to unrealized loss in the value of investments. The fund holds securities listed on the JSE, which declined by a total of $1,099 million. This was reflective of overall market conditions that prevailed during the quarter. The fund benefitted from cash income from dividends and interest of J$18.8 million and J$0.8 million, respectively.”
Total expenses for the three months period closed at $10.79 million. Management noted expenses, “were related to legal & professional fees, management fee, and transaction costs. The transaction costs were associated with purchasing additional securities for the funds –FTNA and LUMBER as well as increasing the volume of stocks previously held to improve tracking of the index.”
Consequently, net loss closed the three months period at $1.09 billion.
Loss per share for the period under review amounted to $0.29. The number of shares used in this calculation was 3,783,443,000 shares. As at May 18, 2020 the stock traded at $0.89.
Management highlighted, “the outlook is characterized by severe human and economic cost relating to the COVID-19 pandemic. Investors have reacted to the heightened uncertainty by applying a higher risk premium to financial assets, primarily for equities. This condition is expected to persist over the near-term, as the Government implements measures to slow the spread of the virus locally. The return to normal times is largely predicated on discovery of a vaccine to stop COVID-19. Consequently, the earnings growth rate for most companies is expected to slow in the near term as economic activities decelerate. However, given the relative strength gained from the economic reform over the past 5 years, the local economy should be able to rebound at a faster pace. This should be favorable for stock price performance over the medium to long term.”
Balance Sheet Highlights:
Total assets, as at March 31, 2020, amounted to $2.86 billion. Of this, Cash and Cash Equivalents booked $113.01 million, while Financial assets at fair value through profit or loss totalled $2.74 billion.
Total equity as at March 31, 2020 amounted to $2.85 billion, resulting in a net asset value per share of $0.75.
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.