Revenue barely inched up to J$123.3 million‘

Durrant Pate/Contributor

Jamaican real estate company, Stanley Motta achieved a lacklustre performance during the September quarter, which was flat both in terms of revenue performance and profitability.

Revenue for the third quarter in September amounted to J$123.3 million, representing a marginal increase of 1.6 per cent over J$121.4 million recorded for the same quarter last year. Revenue for the nine-month period also improved marginally, up 2.2 per cent from J$365.4 million in 2021 to J$373.4 million for the combined three quarters under review.

The marginal improvement in revenue is attributable to the depreciation of the Jamaican dollar, which moved from an average of J$149.34:US$1 as at September 2021 to J$152.68:US$1 at September 2022. Administrative expenses for the year-to-date (YTD) is up of five per cent, moving from J$142.5 million in 2021 to J$149.6 million for the nine-month ended September 30, 2022.

Income was equally lacklustre

Similarly, there was a 31.8 per cent increase in administrative expenses for the September third quarter when compared to the same quarter of the prior year. The increase in admin expenses mainly related to a higher FX Loss that is incurred YTD compared to that of a lower loss in prior year.

It is important to note that the YTD losses were incurred prior to the refinancing of the company’s US dollar loan, which is now denominated in Jamaican dollars. Another contributing factor to the rise in admin expenses is that depreciation charges are higher year-over-year, as a result of an increase in Right of Use Assets.

Net Operating Income marginally increased year over year, moving from J$229.2 million for September 2021 to J$234.2 million for the September 2022 quarter, a 2.2 per cent increase. However, operating margin as at September 2022 remains strong at 61 per cent.

Funds from Operations YTD is down to J$195 million compared to the J$200.4 million generated for the same period of the prior year, a 2.7 per cent decrease. At the same time, finance costs increased year-over-year, as Stanley Motta incurred fees in the period stemming from the refinancing of its US dollar denominated loan, which included processing and commitment fees.

Net Profit Margin for the YTD period stands at 45.3 per cent and 51.3 per cent for the September quarter.

The company continues to demonstrate its commitment to maintaining strong operational efficiency, while collecting rent in a timely manner.

The management is emphasising that “the overall performance includes expenses that are one-time costs that will not be repeated. Also, non-cash adjustments were made to reflect accounting standards requirements especially as it relates to Right of Use Assets & Lease Liabilities”.

The management is reiterating that Stanley Motta remains in a strong financial position and is committed to ensuring continued increase in value and returns to shareholders.

Earnings per share was J$0.23 for the nine-month period compared to J$0.26 for the corresponding period of the previous year. As a result of the 2021 revaluations, the value of investment property stands at J$6.2 billion as at September 2022 compared to J$5.6 billion as at September 2021.