September 9, 2022
Scotia Group Jamaica Limited (SGJ) for the nine months ended July 31, 2022, Scotia Group Jamaica Limited’s (SGJ) Net Interest Income experienced a 20% increase to $20.36 billion, moving from $17.01 billion for the corresponding period in 2021. Of this, Interest Income for the period rose from $18.41 billion in 2021 to $21.70 billion while Interest Expenses declined by 4% to total $1.35 billion (2021: $1.40 billion). For the quarter Net Interest Income amounted to $7.65 billion, moving from $5.71 billion for the corresponding period in 2021.
The Company reported an expected Credit Loss of $2.18 billion compared to the loss of $1.99 billion for the comparable period in 2021. As such, Net Interest Income after expected credit losses rose 21% to $18.18 billion relative to the $15.02 billion recorded for the corresponding period in 2021.
Total Other Revenue fell by 10% to $13.26 billion (2021: $14.73 billion). Of this:
- Net Fees and Commission Income amounted to $4.69 billion (2021: $4.99 billion), a decrease of 6% relative to the corresponding period in 2021. SGJ mentioned that “the Group continues to expand its provision of alternative channels which attract lower fees.”
- Insurance Revenue rose by 16% and closed the period at $2.36 billion relative to $2.02 billion last year.
- Net Foreign Currency Activities contracted by 16% and amounted to $5.24 billion (2021: $6.21 billion).
- Net Gains on Financial Assets lowered to $38.65 million relative to $506.31 million recorded in 2021.
- Other Revenue fell from $1 billion in 2021 to $942.61 million in 2022, representing a 6% decline.
As such, Total Operating Income for the period increased by 11% to total $31.44 billion versus $29.75 billion for the corresponding period in 2021. Total Operating Income for the quarter amounted to $11.49 billion, 19% more than the $9.63 billion booked for the same quarter of 2021.
Total Operating Expenses for the nine months amounted to $19.46 billion, a 2% growth over the $19.05 billion booked for the corresponding period in the prior financial year. The Company noted that “The Group’s continued strong financial performance was driven by growth across our core business lines supported by prudent expense management.”
Under operating expenses:
- Salaries and Staff Benefits rose to close the period at $7.52 billion (2021: $7.31 billion)
- Property Expenses (Including Depreciation) grew by 7% amounting to $1.80 billion (2021: $1.68 billion).
- Amortization of Intangible Assets declined 7% to close the period at $68.22 million versus $73.48 million in 2021.
- SGJ reported $1.32 billion for Asset Tax, 8% more than the $1.22 billion documented for the same period for 2021.
- Other Operating Expenses closed the period at $8.75 billion relative to $8.76 billion in 2021.
Profit before Taxation for the period totaled $11.98 billion; this represents a rise of 12% from the $10.70 billion recorded in 2021.
Tax charges for the period totaled $3.61 billion (2021: $3.41 billion), as such Net Profit for the period totalled $8.37 billion, 15% higher than the $7.29 billion posted for the same period in 2021. Profit for the quarter amounted to $4 billion, 43% more than the Net Profit of $2.81 billion a year earlier.
Profit attributable to shareholders for the period totaled $8.37 billion relative to the $7.29 billion recorded in 2021. Profit attributable to shareholders for the third quarter totaled $4 billion compared to $2.81 billion booked for the comparable period of 2021.
Total Comprehensive Loss for the nine months ended July 31, 2022, amounted to $3.40 billion (2021 income: $9.18 billion). For the quarter, Total Comprehensive Loss amounted to $6.52 billion relative to Total Comprehensive loss of $1.15 billion reported for the same quarter last year.
Earnings per share (EPS) for the period totaled $2.69 (2021: $2.34), while earnings per share for the quarter totaled $1.29 (2021: $0.90). The trailing earnings per share amounted to $3.05. The total number of shares employed in our calculations amounted to 3,111,572,984 units. Notably, SGJ’s stock price closed the trading period on September 8, 2022 at a price of $34 with a corresponding P/E of 11.14 times.
Balance Sheet Highlights:
As at July 31, 2022, the Company’s assets totaled $589.29 billion, 2% more than its value of $578.28 billion last year. This in total assets was primarily driven by a $12.33 billion increase in ‘Investment Securities’ to total $158.27 billion (2021: $145.94 billion). SGJ noted, “This was partially offset by the reduction in other assets of $14.4 billion or 27.6% on account of the lower carrying value of the retirement benefit asset.”
SGJ’s shareholders’ equity at the end of the period amounted to $106.94 billion relative to the $116.15 billion recorded in the prior year’s corresponding period. Consequently, the book value per amounts to $34.37 (2021: $37.33).
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