June 16, 2020
Sagicor Real Estate XFUND Limited, for the three months ended March 2020, reported total revenue of $1.34 billion relative to $1.78 billion recorded in 2019, a 25% decline year over year. XFUND mentioned that, “Hotel revenue had been on an upward trend until the latter part of the quarter, when the Group began to experience a significant reduction in demand for travel and leisure activities. Our direct hotel operations segment which comprised DTO and our local hotel contributed $1.56 billion, 11% down on prior year. In a time when the tourism sector is reporting significant losses, our hotel business generated net profits of $0.06 billion.”
Hotel revenue for the three months decreased to $1.56 billion in 2020 versus $1.73 billion in 2019, a 10% decline year over year. Net capital loss for the period under review amounted to $220.82 million compared to net capital gains of $41.98 million documented in the prior comparable period. Also, net investment income closed the first quarter at $5.77 million (2019: $5.28 million) reflecting a 9% increase when compare to the corresponding quarter.
Furthermore, the company booked $510,000 for other income (2019: nil) for the period under review.
Operating expenses fell 4% to $1.47 billion compared to $1.54 billion in the prior corresponding period. Of this:
Hotel expenses declined to $1.07 billion, down 11% when compared to $1.21 billion in the prior corresponding period.
- Depreciation closed at $202.11 million (2019: $164.01 million), reflecting a 23% increase when compared to the corresponding period last year.
- Interest expenses increased by 23% to $180.78 million (2019: $146.46 million)
- Other operating expenses went up by 14% to total $15.87 million (2019: $13.93 million)
Consequently, operating loss amounted to $131.13 million versus operating profit of $242.52 booked in the previous corresponding period.
Impairment of investment in associate closed the period at $3.88 billion (2019: nil). While, share of loss from associate accounted for using the equity method amounted to $474.05 million relative to a profit of $856.98 booked the prior year. Management noted, “The uncertainty surrounding the timing for reopening of the tourism sector and the current reduction in business activities led to a non-cash impairment charge of $3.88 billion on our investment in associated company Playa.”
The Company reported loss before tax of $4.48 billion relative to a profit before tax of $1.10 billion for 2019 three months period. Tax credit of $8.91 million (2019: tax charges of $69.08 million), resulting in net loss of $4.47 billion compared to net profit of $1.03 billion recorded in March 2019.
XFUND recorded net loss attributable to shareholders of $2.77 million versus net profit attributable to shareholders of $694.57 million booked in the same period last year.
Total comprehensive loss closed the period under review at $3.95 billion versus total comprehensive income of $466.99 million was recorded in the similar period last year.
As such, loss per share (LPS) for the three months period amounted to $1.23 (2019: EPS $0.31). The trailing twelve-month LPS is $1.56. The number of shares used in our calculations was 2,243,005,125. As at June 15, 2020, the stock traded at $7.98.
The company mentioned, “The Group started the year on a promising growth trajectory. However, in March the World Health Organization (WHO) declared the outbreak of COVID-19 a pandemic. To contain the outbreak, travel restrictions were imposed globally which led to a sharp decline in international tourist travel. In response to this, our local hotel and those owned by our partner, Playa Hotels & Resorts N. V. (Playa) suspended operations. DoubleTree by Hilton (DTO) remains open but is operating with reduced occupancy. The unprecedented downturn in business activities has led to a reduction in earnings for Q1 2020”
Balance Sheet Highlights:
The Company, as at March 2020, recorded Total Assets of $45.22 billion, an 8% decrease when compared to $49.22 billion recorded as at March 2019. This was as a result of a decline in ‘Investment in Associate’ and ‘Receivables’ which closed at $23.91 billion (2019: $28.24 billion) and $780.13 million (2019: $1.12 billion), respectively.
Total Shareholders’ Equity as at March 31, 2020 closed at $23.16 billion, a 9% decrease from the $25.35 billion recorded for the corresponding period last year. This resulted in a book value per share of $10.33 (2019: $11.30).
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