124% increase in gains on investments in associates to $1.9 billion

Durrant Pate/Contributor

Investment by Mayberry Group, in its associate companies, is reaping rich dividends, particularly in the just-ended June quarter where net profit attributable to shareholders jumped by J$2.5 billion.

This represents a 31 per cent increase when compared to net profit of J$1.9 billion for the corresponding quarter in 2021. This performance was attributable mainly to growth in unrealised gains on investments in associates, which increased by J$2.9 billion or 124 per cent.

At the same time, dividend income surged by 34 per cent or J$45.8 million while consulting fees and commissions grew by 77 per cent to J$58.4 million. Total operating expenses for the period under review grew by J$343.5 million to J$805.4 million when compared to June 2021.

Total assets reported for the period ended June 30, 2022, grew to J$53.6 billion compared to J$39.3 billion for the comparative period for 2021. This represents a J$14.3 billion or 36 per cent increase in asset base.

Net book value per share increased to J$15.32, a J$2.17 or 17 per cent increase over the corresponding period in 2021. This was mainly attributable to price appreciations which positively impacted the value of investment securities, investment properties and investment in associates.

Growth in interest income

Net interest income increased 47 per cent to J$83.7 million over the second quarter of 2021. This growth was driven mainly by increased revenue on repurchase agreements and growth in the margin loan book.

Net unrealised gains on investments rose by J$2.9 billion to J$5.4 billion during 2022 from the Group’s investment in associates and financial instruments, reflecting capital appreciation on equities with the year over year increases in market prices.

Dividend income grew by 34 per cent to J$182.3 million for the period under review. Fees and commission income grew by 77.1 per cent compared to the corresponding period in 2021.

This was mainly attributable to significant growth in equity commission and loan processing fees, and higher selling fees for Initial Public Offer transactions. Other income trended up J$62.1 million compared to the corresponding 2021 period.

Net foreign exchange gains of J$35.2 million were lower by $42.6 million while other operating expenses for the second quarter increased by J$141.3 million, moving from J$270.3 million in 2021 to J$411.6 million in the current period under review. The increase was mainly driven by management and incentive fees to investment managers following the significant improvement in net asset value under management the portfolio managed.

Assets & Liabilities

Total assets as at June 30, 2022 totalled J$53.6 billion, an increase of J$14.3 billion over the prior year. The growth in the asset base was primarily due to increases in investment in associates by J$10.5 billion, higher net loans, investment securities and cash balances. Intangible assets increased by J$352.6 million compared to June 30, 2021 as the Group continued the roll out of its new digital platform.

Total liabilities for the Group were J$24.5 billion, an increase of J$5.4 billion or 28.1 per cent over the 2021 corresponding period, driven mainly by growth in securities sold under repurchase agreements, loans and accounts payable. Shareholders’ Equity  amounted to J$18.4 billion at the end of June 30, 2022 compared to J$15.8 billion for the prior period in 2021.

The year-on-year increase of J$2.6 billion was mainly driven by a J$3.6 billion increase in retained earnings. This resulted in a net book value per share of J$15.32 (2021: J$13.15).