September 16, 2019
In United States dollars (except where it is indicated otherwise)
Sygnus Credit Investments Limited, for the nine months ended June 30, 2019 reported Interest Income of US$3.17 million 171% increase on the US$1.17 million recorded in 2018. For the quarter, Interest Income rose 104% to US$727,583 (2018: US$356,542).
The Company also reported Fair Value Gains of US$135,429 (2018: US$644,326) and Participation fees of US$50,944 (2018: US$23,413). Management noted the performance of Fair Value Gains, “reflected investments in two Portfolio Companies with profit sharing participation, in addition to regular investment income that is earned.” As such, Sygnus reported year end revenue of US$3.35 million compared to US$1.84 million. For the quarter, Sygnus booked revenue of US$645,412 versus US$878,337 for the quarter ended June 31, 2018. Management highlighted, “SCI’s record 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.”
Total Expenses for the year amounted to US$1.30 million, a 214% surge relative to US$414,909 recorded for the corresponding period in 2018. Total expenses for the quarter amounted to US$521,214 relative to US$206,474 for the same quarter of 2018. Of expenses:
- Management fees amounted to US$707,175 (2018: US$182,368).
- Other expenses for the period amounted to US$68,415 (2018: US$2,142). Audit Fees declined 25% year over year from US$48,435 in 2018 to US$36,537 for the year ended June 2019.
- Registration fees decline 40% to US$9,310, down from US$15,581 in 2018. Directors Fees and Related Expenses rose 38% to close at $US40,203 (2018: US$29,225). Irrecoverable Withholding Tax and Professional Fees amounted to US$39,239 (2018: US$25,317) and US$60,609 (2018: US$32,572) respectively
- Impairment Allowance on Financial Assets for the year amounted to US$74,645 versus nil for 2018. Management indicated, “the ECL for FYE Jun 2019 was US$74.78 thousand following the adoption of IFRS 9 at the beginning of the financial year. This represents 0.3% of the value of assets carried at amortized cost before the application of ECL. There was no comparable figure for FYE Jun 2018, as, under the ECL transition method chosen, comparative information for the similar period last year is not restated. SCI does not have any non-performing or impaired private credit investments.”
Profit for the year of US$2.05 million was booked for 2019, relative to US$1.42 million in 2018, a 44% increase year over year. For the quarter the Company booked US$124,198 compared to US$671,863 for the same quarter of 2018.
As a result, Earnings per share (EPS) for the year amounted to US$0.0059 (2018: USD$0.0041). EPS for the quarter amounted to US$0.0004 (2018: US$0.0019). The number of shares used in our calculations amounted to 350,087,563 units. Notably, SCIJA and SCIJMD closed the trading period on September 16, 2019 at a price of $13.06 and $23.06 respectively. Both SCIUS and SCIUSD closed the trading period on September 16, 2019 at US$0.13 and US$0.15.
Management indicated, “SCI made new investment commitments valued at US$18.23 million during FYE Jun 2019 vs US$15.07 million in FYE Jun 2018, net of repayments. The number of Portfolio Companies expanded to 19 for FYE Jun 2019 vs 7 for FYE Jun 2018.”
Balance Sheet Highlights
As at September 16, 2019, Sygnus’ total assets amounted to US$38.15 million, a 3% increase on 2018’s assets base of US$37 million. This was due to an increase in ‘investments’ to US$32.39 million (2018: US$15.20 million) and ‘Finance lease receivables which was declared at US$1.58 million (2018: 498,960). Cash and Cash Equivalents jumped from US$400,259 as at June 30, 2019 to US$2.10 million as at June 30, 2019.
Total Stockholders’ equity as at June 30, 2019, closed at $37.59 million, relative to $36.62 million for the corresponding period last year. This resulted in a book value per share of US$0.11 compared to the value of $0.10 as June 30, 2018.
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