VMIL reports 69% increase in nine months net profit

November 15, 2021

Victoria Mutual Investments (VMIL) reported total interest income of $802.43 million, an increase of 9% relative to the $733.45 million recorded for the corresponding period in 2020. Interest income for the quarter stood at $270.85 million relative to $271.71 million in 2020.

Interest expense for the nine months amounted to $533.66 million, an 11% increase relative to the $481.33 million recorded in 2020.

As such, net interest income closed the period at $268.77 million, a 7% increase relative to the $252.12 million recorded for the corresponding period in 2020. Net interest income for the quarter totaled $78.25 million, a 30% decrease on the $112.50 million booked in 2020’s corresponding quarter.

VMIL recorded gains from investment activities for the period of $712.17 million, a 271% increase relative to the gain of $192.11 million recorded in 2020.

Net fees and commissions closed the period at $729.99 million, a 1% decrease compared with the $734.87 million recorded for the comparable period in 2020.

Other income for the period reflected a total of $59.63 million, a 61% decrease compared to $154.44 million recorded for last year.

Consolidated revenues amounted to $1.77 billion (2020: $1.33 billion) for the nine months ended September 30, 2021.

Staff cost and other operating expenses both increased 9%, to close the period at $486.55 million (2020: $447.34 million) and $426.85 million (2020: $400.13 million) respectively.

Notably, VMIL also booked a recovery on ‘Provision for credit losses on financial assets’ of $21.64 million relative to a loss of $54.14 million for 2020.

Total operating expenses for the nine months amounted to $891.76 million (2020: $901.61 million).

Operating profit amounted to $878.81 million for the nine months, a 104% increase relative to $431.93 million recorded for the prior corresponding period. Operating profit for the quarter totalled $509.29 million (2020: $325.34 million).

Share of loss in associate amounted to $28.43 million (2020: $23.42 million).

Profit before taxation amounted to $850.38 million for the period, a 108% increase relative to $408.52 million recorded for the prior period. Taxation amounted to $238.05 million (2020: $46.69 million).

Consequently, net profit for the nine months amounted to $612.33 million, a 69% increase relative to the $361.83 million booked for the same period in 2020. Net profit for the quarter totaled $347.77 million, an 82% increase on the $190.94 million recorded for 2020’s corresponding quarter.

Total comprehensive income, for the nine months ended September 30, 2021, amounted to $183.36 million relative to a loss of $385.01 million for the similar period in 2020. For the third quarter of 2021, total comprehensive income amounted to $319.83 million compared to a loss of $310.83 million reported for the similar quarter in 2020.

Earnings per share for the period totalled $0.41 (2020: $0.24), while earnings per share for the quarter amounted to $0.23 (2020: $0.13). The twelve month trailing earnings per share is $0.46. The number of shares used in our calculations 1,500,025,000 units. Notably, VMILs stock price closed the trading period on November 12, 2021 at a price of $6.27 with a corresponding P/E of 13.75 times.

VMIL noted, “Our third quarter performance was underpinned by the recovery of the local economy which positively impacted asset prices, bond trading and capital market activities.” Additionally, “VMIL leveraged its investment grade ratings received from CariCris, to raise $2.3B in the local market which VMIL will use to propel the growth of its lending business,” as per Management.

The Company also noted that, “on November 3, 2021, VM Group launched its brand transformation, which includes a series of physical and internal rebranding activities. These include the name change from ‘Victoria Mutual’ to ‘VM’ for the Group, as well as its subsidiaries; and a change of the logo and brand colours. VMIL is positioned to leverage the strategic advantages of the brand transformation of the VM Group, which is expected to result in greater focus on integration across the business and improved visibility for the products and services offered by VM Investments and VM Wealth Management.”

Balance Sheet at a Glance:

As at September 30, 2021, The Company’s asset base totaled $30.40 billion, up from $26.69 billion at September 30, 2020. The main contributor to the increase in total assets was ‘Investment Securities’ which amounted to $20.86 billion relative to $16.79 billion in 2020.

Total Stockholders’ Equity as at September 30, 2021 was $4.51 billion (2020: $3.85 billion); resulting in a book value per share of $3.01 (2020: $2.56).



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