May 15, 2019
In United States dollars (except where it is indicated otherwise):
Sygnus Credit Investments Limited for the nine months ended March 31, 2019, reported Interest Income of US$2.44 million 200% increase on the US$814,375 recorded in 2018. For the quarter, Interest Income rose 205% to US$978,580 (2018: US$321,308).
The Company also reported Fair Value Gains of US$101,299 (2018: nil) and Participation fees of US$40,944 (2018: US$13,471). Management noted the performance of Fair Value Gains, “were driven by investments in two Portfolio Companies with profit sharing upside, in addition to regular investment income that is earned. There were no fair value gains for the similar periods in 9 month 2018 and Q3 2018.” The company booked Net Foreign Exchange Gains of US$126,301 for the nine months period relative to US$132,473 in 2018. As such, Sygnus reported nine months revenue of US$2.71 million compared to US$960,319. For the quarter, Sygnus booked revenue of US$1.24 million versus US$327,279 for the quarter March 31, 2018.
Total Expenses for the period amounted to US$782,575, a 275% surge relative to US$208,435 recorded for the corresponding period in 2018. Total expenses for the quarter amounted to US$241,022 relative to US$236.269 for the same quarter of 2018. Of expenses:
- Management fees amounted to US$526,959 (2018: 79,250).
- Other expenses for the period amounted to US$42,121 (2018: Nil). Audit Fees declined 53% year over year from US$25,235 in 2018 to US$11,787 for the nine six months of 2018.
- Registration fees decline 67% to US$4,288, down from US$12,838 in 2018. Directors Fees and Related Expenses rose 35% to close at $US22,869 (2018: US$16,928). Irrecoverable Withholding Tax and Professional Fees amounted to US$38,553 (2018: US$24,796) and US$45,761 (2018: US$31,520) respectively
- Provision for expected credit loss amounted to US$60,257 compared to nil in 2018.
Profit for the period of US$1.93 million was booked for the period, relative to US$751,884 in 2018, a 156% increase year over year. For the quarter the Company booked US$1 million compared to US$91,010 for the same quarter of 2018. According to management, “the results were driven by an expanding portfolio of private credit investments across the Caribbean region, in keeping with SCI’s mandate to provide Caribbean middle market firms with access to a non-traditional financing channel.”
As a result, Earnings per share (EPS) for the period amounted to US$0.010 (2018: USD$0.004). EPS for the quarter amounted to US$0.0054 (2018: US$0.0005). The twelve months trailing eps amounted to US$0.014. The number of shares used in our calculations amounted to 184,311,300 units. Notably, SCIJA and SCIJMD closed the trading period on May 15, 2019 at a price of $11.42 and $12.20 respectively. Both SCIUS and SCIUSD closed the trading period on May 15, 2019 at US$0.11 and US$0.10.
Management indicated, “SCI made new investment commitments valued at US$6.47 million during Q3 2019, gross of US$3.44 million in repayments, for a net investment commitment of US$3.03 million. The investments were originated in the health & lifestyle, distribution, mining & quarrying and telecommunication service industries, in leading firms with strong growth and free cash flow generation. There were no investments made during Q3 2018 as transactions were approved during the quarter but executed at the start of the following quarter. There was 1 short term investment exited during Q3 2019, similar to Q3 2018.”
Balance Sheet Highlights
As at May 15, 2019, Sygnus’ total assets amounted to US$38.79 million, a 132% increase on 2018’s assets base of US$16.71 million. This was due to an increase in ‘investments’ to US$29.56 million (2018: US$10.83 million) and ‘Finance lease receivables which was declared at US$1.68 million (2018: Nil). Cash and Cash Equivalents jumped from US$370,707 as at March 15, 2018 to US$1.59 million as at March 15, 2019.
Total Stockholders’ equity as at March 15, 2019, closed at $37.46 million, relative to $16.66 million for the corresponding period last year. This resulted in a book value per share of US$0.20 compared to the value of $0.09 as March 15, 2018.