Date: May 13, 2019 

Sagicor Group Jamaica Limited (SJ) for the three months ended March 31, 2019, Total revenues increased by 27% to $20.12 billion from $15.82 billion in 2018, and was broken down as follows:

• • Net investment income increased to $5.28 billion from $4.10 billion in 2018. SJ noted that this was “ influenced predominantly by higher equity prices on the Jamaica Stock Exchange and the fact that the 2018 numbers included much higher impairment charges”
  • Fees and other revenue increased 27% to $3.01 billion (2018: $2.38 billion). Management noted this was primarily due to “ongoing growth of the Payments business in Sagicor Bank and a large corporate financing transaction in Sagicor Investments during the quarter.”
  • Net premium revenue increased by 11% to a total of $10.36 billion from $9.34 billion in 2018.
  • Hotel revenue of $1.47 billion was booked for the period relative to nil the prior year. The company noted, “ Share of Revenue from hotels (Jewel Grande Montego Bay) was include at $1.47 billion with the consolidation of XFund.”

Benefits and expenses totaled $16.45 billion for the period, increasing year over year by 31% from $12.54 billion. This increase was mainly driven by;

• • A 5% increase in net insurance benefits incurred to $6.49 billion (2018: $6.19 billion), “due to portfolio growth and a higher claims experience for both Life and Death claims”.
  • Administration expenses for the period amounted to $4.76 billion compared to $4.34 billion in the prior year, a 10% increase. Management noted, “There was a 6% increase when the new subsidiaries are excluded reflecting increments to Salaries and higher Payments related costs.”
  • Commission and related expenses rose by 16% to close at $1.46 billion up from the $1.26 billion posted in 2018.
  • Amortization of intangible assets amounted to $183.81million (2018: $170.55 million), a 8% increase.
  • Asset tax moved up by 1% to close at $641.49 million in 2018 from $637.80 million in 2018.
  • SJ also booked Hotel expenses of $964.80 million relative to nil the prior year.

Share of loss from joint venture amounted to $4.62 million relative to a profit of $770,000 the prior year. Share of profit from associates totaled $856.98 million relative to $141.85 million last year. According to SJ, “share of profit from Associate represents the 15% take-up of Playa Hotel & Resorts’ earnings for Q1 before minority interests, which reflect a good performance during the peak winter season.”

Profit before taxation amounted to $4.53 billion, a 32% gain when compared to the $3.43 billion booked in 2018.

After investment and corporation taxes of $1.03 million (2018: $786.46 million), net profit amounted to $3.50 billion (2018: $2.64 billion), an increase of 33%.

Profit attributable to shareholders amounted to $2.70 billion relative to $2.64 billion booked in 2018. As a result, EPS for the quarter amounted to $0.69 (2018:$0.68) while the twelve-month trailing EPS totaled $ 3.66.

Balance Sheet at a glance:

Total assets increased by 14% or $51.08 billion to close at $406.32 billion as at March 31, 2019, from $355.25 billion the year prior. The main contributors to the increase in total assets were ‘Financial Investments’ amounting to $168.59 billion (2018: $139.15 billion), a 21% increase year over year and ‘Investment in associated company’ which closed at $24.83 billion compared $7.21 billion the previous year. ‘Property, Plant and Equipment’ also witnessed a 300% increase from $5.04 billion to $20.16 million.

Equity attributable to stockholders of the company as at March 31, 2019, stood at $79.49 billion (2018: $66.78 billion) resulting in book value per share of $20.35 (2018: $17.10). The number of shares used in our calculations amounted to 3,905,634,918 units. SJ’s stock price closed on May 10, 2019, at $47.11.

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