XFUND Reports 2% Decline in Six Months Net Profit Attributable to Stockholders

Date: August 15, 2018

Sagicor Real Estate XFUND Limited, Total Revenue for the six months ended June 30, 2018, rose 2% to $6.07 billion (2017: $5.95 billion). For the quarter, total revenue fell by 4% to $2.68 billion relative to $2.79 billion).

Hotel revenue for the six months period increased to $2.89 billion relative to $2.44 billion in 2017, an 18% improvement year over year. Net Investment expenses and net capital gains on financial assets and liabilities both increased to close at $137.94 million (2017: $31.65 million) and $603.31 million (2017: $432.32 million) respectively. Hotel revenue from discounted operations slipped 12% to close at $2.71 billion relative to $3.09 billion.

The company stated that, “Effective June 1, 2018 the Group sold the Hilton Rose Hall Resort and Spa (Hilton Rose Hall), three (3) of the Jewel hotels as well as lands that were owned by the Sigma Real Estate Portfolio (Sigma Portfolio) and a part of the Jewel Grande to Playa Hotels and Resort N.V. (Playa).”

Operating Expenses slightly increased 1% to $4.96 billion (2017: $4.91 billion). Whereas, Hotel Expenses increased by 10% to $1.88 billion (2017: $1.71 billion) and a 4% decrease in Interest Expense to $702.90 million (2017: $731.26). Hotel expenses for the quarter totaled $916.13 million compared to $892.24 million in 2017.

 There was deprecation of $305.55 million (2017: $137.14 million) for the period under review. Depreciation for the quarter totaled $164.99 million (2017: $73.03 million). The company mentioned that, “This was primarily driven by major renovation of our directly owned hotel- namely DoubleTree Universal in Orlando, Florida (DoubleTree) during 2016 through 2017 in keeping with the franchisors’ brand standards.”

Other operating expenses increased to $38.07 million (2017: $12.67 million). However, for the quarter, there was an increase to XFUND booked $20.56 million for other operating expenses versus $4.04 million).

 The company’s Profit before Tax climbed 6% to $1.11 billion (2017: $1.04 billion) for the six months. After incurring tax charges of $336.95 million (2017: $256.33 million), Net Profit attributable to stockholders reduced slightly by 2% to $770.17 million, down from $785.20 million for the comparable period in 2017. However, for the second quarter, Net Profit increased by 13% to close at $277.54 million (2017: $245.70 million).

 The earnings per share (EPS) for the six months closed at $0.34 (2016: $0.35), While, the EPS for the quarter amounted at $0.12 (2017: $0.11). The trailing twelve-month EPS is $1.22.  The number of shares used in our calculations was 2,243,005,125. As at August 14, 2018, the stock traded at $14.14.

The company highlighted that, “For 2018, we will remain focused on the execution of the strategic plan. Our newly refurbished towers and conference rooms at DoubleTree continue to attract better rates and returns for the Group. Both X Fund and Sigma Real Estate Portfolio continue to actively seek viable real property investments across the region to drive long-term shareholder value. We have also finalized the agreement with Playa involving transfer of certain tourism assets in exchange for cash and shares in Playa, and expect good long term returns thereon.”

Balance Sheet Highlights:

The company, as at June 30, 2018, recorded total assets of $38.75 billion, a decline of 14% when compared to $45.23 billion recorded in the prior year. the decline was due to a 49% fall in Property, Plant & Equipment which closed at $13.10 billion (2017: $25.62 billion).

Total Stockholders’ equity as at June 30, 2018 closed at $24.10 billion, a 16% increase from the $20.69 billion for the corresponding period last year. This resulted in a book value of $10.75 (2017: $9.23).




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