Record results for Eppley after taking larger stake in real estate mutual fund

 

 
Eppley Limited, a Kingston-based investment company that invests throughout the Caribbean and Central America, earned $4.73 per share for the 2024 financial year, generating a 146 per cent return for shareholders.

The company reports profit of J$1.48 billion for the financial year ended December 2024, an increase from J$507 million in the prior year. The profit after tax attributable to Eppley shareholders, excluding net profits from its value fund holdings that Eppley does not own, was J$911 million.

The acquisition of a larger stake in the Eppley Caribbean Property Fund Limited SCC - Value Fund (ECPF) in the third quarter of 2024, positioned Eppley as its largest single shareholder, also gaining management control.

The value fund is the largest publicly listed real estate mutual fund in the Caribbean, holding a diverse portfolio of 39 properties spanning 1.2 million square feet across Jamaica, Barbados, Trinidad, and St. Vincent.

The transaction improved Eppley’s financial performance in 2024 while also reshaping the structure and presentation of its consolidated financial statements, management outlined.

At the end of December 2024, Eppley controlled a $20.6 billion investment portfolio consisting of cash, real estate, leases, loans and investments in real estate, credit and infrastructure joint ventures, subsidiaries and associates.

In addition to its proprietary portfolio, the company now manages and administers the equivalent of over US$142 million of capital, primarily through the Eppley Caribbean Property Fund, Caribbean Mezzanine Fund, and Capital Infrastructure Group.

At the end of the quarter, leverage was 0.86x capital, and average cost of debt was 8 per cent. Eppley closed q4 with $1.8 billion of cash.

For the financial year ended December 31, 2024, Eppley’s gross investment Income – which includes interest income from proprietary capital, asset management fees, net rental income, and net operating lease income—totaled J$913 million, reflecting a 21 per cent increase over the prior year.

Expenses

 support its investment activities, Eppley incurs interest expenses, administrative costs, and taxes. Interest expenses rose to J$454 million in 2024, up from J$315 million, primarily due to additional debt acquired during the year and interest expenses consolidated from the Value Fund.

As a result, net investment Income for the year stood at J$458 million, up from J$438 million in the prior period.

Administrative expenses increased by J$106 million, reaching J$433 million, reflecting consolidation of operating costs at ECPF for the first time.

Management noted, “It does also reflect meaningful increases in personnel costs at Eppley as we continue to invest resources in attracting and retaining members of our team.”

Increases in operating expenses were offset by income from ECPF’s share of profit in joint ventures, which contributed J$629 million, and a one-time gain of J$676 million from a bargain purchase related to the acquisition of the Value Fund shares.

The bargain purchase is a result of the Net Asset Value (NAV) per share of the ECPF shares acquired significantly exceeding the purchase price of these shares.

The Board of Directors approved a dividend of $1.04 per share payable on March 28, 2025, to ordinary shareholders on record as of March 14, 2025.

Management concluded, “It’s unlikely that Eppley will replicate the financial results experienced in 2024 in the near future since they included significant one-time gains. However, we expect that Eppley will continue its long track record of producing attractive returns.”

Photo: Chairman of Eppley PB Scott.

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