Net loss declined to J$256 million coming from J$2.1 billion in 2023.

Durrant Pate/Contributor

Mayberry Jamaican Equities (MJE) sale of its 20% stake in Caribbean Producers Jamaica Limited (CPJ) has resulted in a J$2 billion increase in its net profit for the September 2024 quarter.

MJE sold just over 220.8 million CPJ shares to Jamaican-based manufacturing conglomerate, Seprod Group through its subsidiary, AS Bryden from Trinidad for J$2.3 billion, realizing a gain of 240% on its original investment. MJE acquired up to 29.99 million CPJ shares between June 2014 and September 2015 from $2.30-$3.00. It then acquired 190 million shares at $3.06 in November 2015.

The offloading of CPJ by MJE saw the Natalie G Augustin-led company realizing significant gains on its eight-year investment, which is the primary driver of the J$1.6 billion earned in net trading gains in the review quarter compared to the corresponding period last year. This is in addition to growth in unrealized gains by 29% or J$644 million on fair value through profit and loss (FVTPL) investments in the investment portfolio.

More good news on MJE’s performance

This resulted in an earnings per share (EPS) of J$0.18 compared to a loss per share of J$1.54. Total operating expenses for the quarter went down by J$3.5 million or 6.6% to J$49 million compared to the similar period in 2023. 

Total comprehensive income closed the quarter on J$113.3 million for the July to September 2024 period, representing a phenomenal turn-around in comparison to the total comprehensive loss of J$2.1 billion a year ago. Other comprehensive loss was reduced by J$175 million or 64% to J$98.5 million for Q3 2023 due to improvements in the fair value of equity investments carried at fair value through other comprehensive income (FVTOCI). 

MJE’s is reporting total comprehensive income of J$192.2 million for the nine months ended September 30, 2024. This compares to total comprehensive loss of $J1.9 billion for the similar quarter in 2023. 

Other comprehensive income increased by J$281 million or 168% to J$448 million for the nine months to date when compared to the corresponding period in 2023, attributable to changes in the FVTOCI. 

Big drop in dividend income 

On the negative side, dividend income declined by J$172.6 million or 59% with lower dividends declared on some major holdings. The main contributors to the portfolio’s dividend revenues for the quarter were Supreme Ventures Limited, Dolla Financial Services Limited, NCB Financial Group, Blue Power Group, Carreras Limited and Express Catering of approximately J$114 million. 

Unrealized losses on investments in associates totalled J$1.3 billion for the quarter down from the losses of J$2 billion for 2023. The results in both periods continue to reflect the malaise in the Jamaican stock market over recent years arising from the high interest rate and inflation environment prevailing over the periods, resulting in depressed stock market prices. 

With two successive interest rate reductions announced by the Monetary Policy Committee (MPC) in recent months, MJE management says the outlook for portfolio improvement is positive in the medium term. Net interest expense went up to J$223.9 million, an increase of J$80.1 million or 56% compared to the corresponding quarter in 2023.

This is attributable to the growth in MJE’s borrowings through margin loans for new investments over the period. With the recent repayment of debt and refinancing of margin loan debt with the lower-cost MJE public bond in Q2, the company expects lower interest costs going forward.