September 4, 2023

Sygnus Credit Investments Limited

In United States dollars (except where it is indicated otherwise):

Sygnus Credit Investments Limited (SCIJMD) for the year ended June 30, 2023, reported a 43% increase in Interest income totaling $12.62 million compared to $8.83 million in the corresponding period last year. Interest income for the fourth quarter had a 122% increase to close at $3.51 million compared to $1.58 million for the comparable quarter of 2022.

Interest expense amounted to $5.95 million (2022: $3.11 million), this represents an increase of 91% year over year. Consequently, net interest income increased by 15% to $8.14 million compared to $7.10 million for the year ended June 30, 2022. The company booked net interest income of $3.51 million for the fourth quarter versus $1.58 million reported for the similar quarter of 2022.

Fair value gains on investment declined by 71% to total $1.18 million. SYGNUS noted, “The FY 2022 total primarily reflected one-off gains on one portfolio company. This year’s figure primarily reflected a lower amount of new fair value assets being added to the balance sheet, which more than offset the fair value losses from adverse movement in interest rates against the existing assets on the balance sheet.”

Total Revenue decreased by 12% to close at $9.77 million (2022: $11.12 million). Management fees increase by 22% from $1.93 million in 2022 to $2.36 million in the period under review. Performance fees totalled $119,445 versus the $50,939 reported a year prior. Net foreign exchange gain of $146,069 was reported for the year relative to a loss of $405,221 recorded a year prior. The Company highlighted, “The movement in foreign exchange gains and losses was a general reflection of realized gains or losses on FX transactions (buying or selling) and unrealized gains or losses from the Group’s net exposure to Jamaican dollars, which fluctuate based on movements in the JMD/USD exchange rate.”

Other expenses for the year ended June 30, 2023, amounted to $892,042, a 35% increase relative to $659,117 reported in 2022. Other expenses for the fourth quarter amounted to $216,489 (2022: $198,367). Total Expenses totalled $4.50 million, a 38% decrease from the corresponding period last year. (2022: $7.21 million).

Profit before tax for the period for the year ended June 30, 2023, amounted to $5.27 million, a 34% increase relative to $3.92 million reported in 2022. Profit before tax for the period for the fourth quarter amounted to $777,967 (2022: $1.06 million).

Tax charge for the year reaches $136,203 (2022: $96,373). Profit for the year, being total comprehensive income for the year amounted to $5.13 million, a 34% increase from the $3.82 million reported in 2022. For the fourth quarter, Profit for the year, being total comprehensive income was $849,118 (2022: $991,587).

Consequently, Earnings Per Share for the year amounted to US$0.0087 (2022: EPS: US$0.0065), while Earnings Per Share for the quarter totaled $0.001 (2022: EPS: $0.002). The number of shares used in these calculations was 590,975,463.

Notably, SCIJMD and SCIUSD’s stock prices closed the trading period on September 1, 2023, at prices of JM$11.47 and US$0.092, with corresponding P/E ratios of 8.50x and 10.59x respectively.

Balance Sheet Highlights

The company’s assets totalled $163.86 million (2022: $136.79 million). The increase in assets resulted mainly from a $30.31 million increase in ‘Investments’ which closed at $151.21 million.

Shareholder’s equity was $69.81 million (2022: $67.46 million), representing a book value per share of $0.12 (2022: $0.11).

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