SIL reports 4% increase in year end net profits

Date: March 1, 2019 

Sterling Investments Limited (SIL) for the year ended December 31, 2018 reported a 22% increase in total revenue to $110.44 million compared to $90.66 million recorded for the corresponding period in 2017, “reflecting increased foreign exchange earnings and trading gains” the Company noted. Of total revenue:

  • Interest income closed the period at $82.20 million, up 4% from the $79.08 million for the comparable period in 2017.  The company noted this was “attributable to higher-yielding assets throughout the year”.
  • The Company booked no gain on disposal of available for sale securities for the period relative to $37.82 million recorded the prior year.
  • Foreign exchange gain amounted to $23.01 million compared to the loss of $26.24 million booked the prior year’s period.
  • The Company booked net gain on sale of debt investment securities at FVOCI of $2.60 million relative to nil in 2017.
  • The Company also booked Net gain on sale of equity investment securities at FVTPL of $2.64 million relative to nil in 2017. SIL noted, “SIL recorded a realized gain on quoted equities of J$2.6 million, while the net interest margin was 86.6 per cent, led by the company’s strategy of using efficient funding sources to increase stockholder returns.”

The Company also noted, “Despite improvements in key figures, SIL noted that the global capital markets were characterized by extremely high levels of volatility in the last quarter of 2018 which led to bond and equity prices declining significantly”

The company experienced a 47% increase in total expenses to total $53.38 million (2017: $36.27 million) for the year ended December 31, 2018. Of this:

  • Interest expense totalled $10.99 million (2017: $7.64 million).
  • Other expenses totalled $28.80 million, an increase of 1% (2017: $28.40 million).
  • SIL booked an impairment loss on available for sale securities of $9.44 million relative to the loss of $1.16 million for the corresponding period in 2017.
  • The Company also booked no unrealised loss on derivative relative to the loss of $392,078 booked in 2017.

Operating profit recorded for the year closed at $57.07 million relative to $54.38 million booked for the prior year. Operating loss for the quarter closed at $52.05 million, a 286% decline when compared with the loss of $13.50 million booked for the prior year’s quarter.

Other income for the period grossly increased from $1,087 to $252,709.

Preference dividend expense for the year ended December 31, 2018, totalled to $3.05 million, an increase of 61% relative to $1.90 million last year.

Tax charges of $452,648 (2017: $808,586) was booked for the year and as such, net profit amounted to $53.82 million (2017: $51.68 million), a 4% or $2.14 million increase.  Net loss for the quarter amounted to $36.58 million relative to the loss of $7.32 million reported for the comparable quarter in 2017.

Total comprehensive loss for the year amounted to $21.71 million compared to the income of $58.08 million booked for 2017.

This resulted in earnings per share of $0.144 relative to $0.138 in 2017. Loss per share for the quarter amounted to $0.098 compared to a loss per share of $0.020 in 2017. The numbers of shares used in the calculations are 374,094,682 units. SIL stock price closed the trading period on February 28, 2018 at a price of $4.04 while SILUS closed the trading period at US$0.04.

 

Balance Sheet Highlights:

As at December 31, 2018, the company’s assets totalled $1.21 billion, 3% more than $1.17 million a year ago. This resulted mainly from an increase in ‘Investment Securities’ which closed at $1.16 billion, 5% higher than the $1.11 billion booked as at December 31, 2017.  SIL indicated that “SIL has used the decline in prices as an opportunity to purchase undervalued assets that it believes will appreciate over time.”

Shareholder’s equity as at December 31, 2018 stood at $845.54 million compared to $866.52 million in 2017. The book value per share amounted to $2.26 (2017: $2.32).

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2019-03-01T16:54:02+00:00