Durrant Pate/Contributor

Sterling Investment is emerging as one of the most profitable companies in 2025, with net profits surging by 222% for the half-year period January 1 to June 30.

During the period, net profit moved from $25.7 million $82.7 million, primarily the result of higher gains on sale of investments, higher unrealised foreign exchange (FX) gains and a reduction in interest and operating expenses. Revenues for the six-month period closed at $126.9 million, roughly 76% more than the J$72.2 million m ade in 2024.

This was primarily the result of higher gains on sale of investments and higher unrealised foreign exchange gains. Unrealised FX gains totalled $49.4 million in the first half of 2025 compared to J$12.2 million in the same period of 2024. 

Gains on sale of investments amounted to $10 million for the first half of 2025, versus a loss of J$1.8 million for the same period in 2024. This was the result of the net sale of profitable bond positions. 

Operating income more than tripled

Net operating income in the first half of 2025 more than tripled to $82.7 million, up from $25.7 million a year ago. This was fuelled by a 47% decline in interest expense, which moved from $14.1 million in the first half of 2024 to $7.4 million in the first half of 2025.

This is in addition to a 24% decline in operating expenses, which moved from J$32.3 million in the first half of 2024 to J$24.6 million in the first half of 2025. The decline in interest expense is due to the reduction in the Fed Funds rate that took place in late 2024. 

The decline in operating expenses was primarily due to lower audit fee accruals. For the second quarter of 2025 (April 1, 2025 – June 30, 2025) total revenue closed on $58.2 million, up from $42.2 million a year ago, representing a 37.9% increase. 

This was primarily driven by higher foreign exchange gains in 2025 and growth in interest income. Total expenses for the quarter moved from J$25.7 million in 2024 to $22.4 million for the period under review.

Second quarterly performance

This was primarily the result of declines in interest expense (lower Fed Funds rate) and lower audit fee accruals. The combined impact of these factors resulted in a net profit movement from J$16.5 million in the second quarter of 2024 to J$35.8 million for the second quarter of 2025, an increase of 117%. 

Sterling Investments recorded total assets as at June 30, 2025, of J$1.7 billion, which is 3.9% below the J$1.8 billion as at June 30, 2024. This partially reflects management’s decision to take profit on some positions and to wait to redeploy the proceeds. 

Total liabilities declined by 53.2% to $174.3 million as at June 30, 2025, from J$372.5 million as at June 30, 2024. This was primarily the result of declines in the margin loan payable. Total equity increased to J$1.55 billion as at June 30th 2025, from J$1.4 billion at June 30th 2024. 

Optimistic outlook

The management anticipates the current political and economic uncertainty will provide attractive investment opportunities, citing, “The investment portfolio is well positioned to take advantage of the market volatility as management has liquidity available and leverage is below historical levels and below internal limits. This process is unlikely to be linear and will likely be punctuated with periods of volatility and price declines.”