November 10, 2023
VM Investments Limited (VMIL) for the nine months ended September 30, 2023 reported a 28% increase in Interest Income totaling $1.32 billion compared to $1.03 billion in the corresponding period last year. Interest Income for the third quarter had a 38% increase to close at $466.61 million compared to $337.44 million for the comparable quarter of 2022. “This was primarily due to a near doubling of interest on loans and a 14.60% rise in interest on investments,” according to management.
Interest Expense amounted to $1.22 billion (2022: $839.39 million), this represents an increase of 45% year over year, driven by a more than two-fold increase in interest on borrowings.
Consequently, net interest income decreased by 45% to $102.68 million compared to $187.44 million for the nine months ended September 30, 2022. The company booked net interest income of $38.79 million for the third quarter versus $51.97 million reported for the similar quarter of 2022.
Gains from investment activities increased by 19% to close at $592.80 million (2022: $499.53 million), while Net fees and commissions decreased by 22% from $782.05 million in 2022 to $613.48 million in the period under review. As a result, other operating revenue for the nine months ended September 30, 2023 amounted to $1.26 billion, a 6% decrease relative to $1.34 billion reported in 2022.
Net interest income and other operating revenue for the nine months ended September 30, 2023, amounted to $1.37 billion, a 10% decrease relative to $1.53 billion reported in 2022. Net interest income and other operating revenue for the third quarter amounted to $548.39 million (2022: $461.37 million).
Driven by increases to staff and administration costs, operating expenses increased 11% to $1.18 billion. (2022: $1.07 billion).
Operating profit totalled $188.34 million a 59% decrease from the corresponding period last year. (2022: $461.67 million).
Profit before taxation for the nine months ended September 30, 2023, amounted to $242.89 million, a 47% decrease relative to $461.67 million reported in 2022. Profit before taxation for the third quarter amounted to $244.47 million (2022: $131.07 million).
Taxation for the nine months ended September 30, 2023 was $52.40 million. (2022: $120.94 million).
Net Profit for the nine months amounted to $190.49 million, a 44% decrease from the $340.73 million reported in 2022. For the third quarter, Net Profit was $156.47 million (2022: $89.00 million). Management stated, “Our YTD Share of Associates’ Profit, including continued improvement of Carilend’s financial performance and positive results from Kingston Properties Limited (KPREIT), amounted to $54.55 million.”
Consequently, Earnings Per Share for the nine months amounted to $0.13 (2022: EPS: $0.23), while Earnings Per Share for the quarter totaled $0.10 (2022: EPS: $0.06). The twelve-month trailing EPS was $0.36 and the number of shares used in these calculations was 1,500,025,000.
Notably, VMIL’s stock price closed the trading period on November 9, 2023 at a price of $3.00 with a corresponding P/E ratio of 8.31x.
Balance Sheet Highlights
The company’s assets totalled $28.36 billion (2022: $27.25 billion). Management noted, “Our asset base increased 4.08% to $28.36 billion, primarily due to the $1.68 billion inclusion of interest in associates. Of note, the company achieved a 59.61% decline in the value of its resale agreements, which contributed to the cash balance increasing to $462.13 million.”
Shareholder’s equity was $2.65 billion (2022: $2.60 billion), representing a book value per share of $1.77 (2022: $1.73).
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