Sagicor Group promotes pipeline of high performing projects

 


Sagicor Group Jamaica Limited (SGJ), for the year ended December 2024 recorded a net profit attributable to stockholders of $9.24 billion, a decrease from the prior year’s profit of $14.37 billion.

Management says several one-off items contributed to the decline in full year profits. 
SGJ meanwhile cites growth in the Group’s insurance revenues and net interest income relative to the prior year.

“Expenses increased broadly in line with inflation, and we continued to fund significant capital investments in digital platforms and data security,” management said.

The Group ended the year with earnings per share (EPS) of $2.37 (2023: $3.67) and Return on Equity (ROE) of 9 per cent (2023: 16 per cent).

While results fell short of our expectations, management says that shareholders should look forward to significant projects in the pipeline.

Sagicor and other key partners signed the $12 billion financing agreement for the Rio Cobre Water Treatment Plant, a public-private partnership that will add 30 per cent to the National Water Commission’s capacity to supply the Kingston Metropolitan Area, thereby alleviating the current water shortages.

The company has also unveiled an upgraded eInvest platform, which allows investors to evaluate and participate in local initial public offerings totally online.

SGL also broke ground on the Portmore Promenade and officially opened New Brunswick Village in Spanish Town, both being mixed-use, multi-billion-dollar developments.

The Group saw 16 per cent growth in its insurance revenues with a year-over-year increase of $7.72 billion. Net investment income increased by 5 per cent over the previous year, with net interest income growing by 10 per cent supplemented by growth in realised and unrealised capital gains of 4 per cent and 7 per cent, respectively.

This was offset by an increase in credit impairment losses on one corporate banking arrangement. Fee income and other revenues of $18.70 billion improved by 6 per cent over the prior year, primarily driven by the ongoing growth in commercial banking activities.

The Group recorded goodwill impairment of $0.70 billion on Alliance Financial Services as the entity’s core revenue growth and margins trend below initial projections.

Stockholders’ Equity ended the year at $102.17 billion (December 2023: $99.78 billion), impacted by dividends declared of $5.35 billion.

Total assets grew by 7 per cent to end at $597.79 billion (December 2023: $560.65 billion) due primarily to a $14.10 billion increase in the Commercial Bank’s loan portfolio.

The growth in assets was funded by increased deposit and security liabilities of $22.75 billion and increased insurance liabilities of $15.36 billion.

SGJ reported that margins on the segment’s health insurance products continue to be challenged by the persistent global rise in drug prices and other medical costs.

The commercial banking segment produced net profit of $3.81 billion (2023: $3.58 billion). It recorded a 9 per cent increase in net investment income supported by greater transaction volumes on its card payments portfolios and growth in net interest income. In spite of the increase in the provision for credit losses in corporate banking facilities, loan portfolios continue to grow with new loans written of $41.05 billion (2023: $36.16 billion), contributing to a $1.80 billion increase in net interest income.

Deposit and other funding liabilities grew by $14.35 billion (2023 growth: $3.17 billion) during the year.

The Investment Banking segment recorded net profit of $0.89 billion compared to the prior year’s profit of $0.76 billion. Net investment income of $3.03 billion increased by 34 per cent (2023: $2.26 billion), mainly due to higher interest income and improvement in market experience gains from securities trading.

Cash and cash equivalents at the end of the period were $54.01 billion (2023: $45.35 billion). The Group’s net cash used in operating activities was $4.15 billion (2023: $2.43 billion). 
Regulatory capital requirements continue to be exceeded across all operating entities.

Photo by clarkeandcash.com

Caribbean Money Daily

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