Moderating growth in key markets troubles Sagicor Group

 


Sagicor Group Jamaica, with presence in Jamaica, the Cayman Islands, Costa Rica and the United States and with investments extending to several other countries is influenced by the economic conditions and trends within these key markets.

For the financial year ended December 31, 2024, the Sagicor Group operations produced net profits attributable to stockholders of J$9.24 billion, a decrease from the prior year’s profit of J$14.37 billion.

Several one-off items that contributed to the decline in full year profits.

Expenses increased broadly in line with inflation, and the Group continued to fund capital investments in digital platforms and data security.

Dividends totaling J$1.37 per share (December 2023: J$1.23 per share) were paid out despite challenges.

In its 2024 annual report, Sagicor Group reported how adverse weather events, such as Hurricane Beryl and Tropical Storm Rafael, which negatively affected key sectors, particularly agriculture and infrastructure development.

Meanwhile global geopolitical tensions contributed to volatility in commodity prices and supply chain disruptions.

Jamaica’s economy experienced a contraction in 2024, with Real Value Added declining by an estimated 0.9 per cent in the Agricultural sector, which resulted in a temporary spike in inflation.

While Hurricane Beryl had a short-term impact on price levels, economic resilience and policy measures helped contain inflationary pressures in the latter part of the year.

Jamaica 2025

Jamaica’s rating remains constrained by structural challenges such as subdued economic growth, a high crime rate, low productivity, and demographic weaknesses. Additionally, the country remains vulnerable to external shocks, including weather-related events. However, Fitch’s Positive Outlook reflects expectations of continued progress in debt reduction and further strengthening of the policy framework, including measures to mitigate climate-related risks.

January to March 2025 quarter should range between 0.1 per cent and 1.0 per cent, with the overall outlook for the medium term remaining positive.

However, Sagicor said in its annual report that several risks could temper this positive outlook. Aging infrastructure in key industries may lead to unexpected downtime, while delays in the execution of capital projects could slow economic momentum. Additionally, weaker-than expected growth among Jamaica’s main trading partners could dampen external demand for Jamaican goods and services, potentially limiting the pace of recovery.

The BOJ projects that inflation will average 5.0 per cent over the next eight quarters, from March 2025 to December 2026. This represents a slight slowdown compared to the previous eight-quarter average of 5.9 per cent. The anticipated moderation in inflation is influenced by lower imported inflation and the delayed impact of the BOJ’s tight monetary policy stance, which is expected to help stabilise inflation expectations and the exchange rate.

Cayman

Economic activity in the Cayman Islands expanded in the second quarter of 2024, with GDP increasing by an estimated 3.0 per cent in real terms. This represents a slowdown compared to the 3.6 per cent growth recorded in the first quarter.

The US

The US economy expanded at a slower than expected pace in the final quarter of 2024, according to the US Commerce Department. Real GDP grew at an annualised rate of 2.3 per cent in the fourth quarter, bringing full-year growth to 2.8 per cent. This was slightly below the 2.9 per cent recorded in 2023.

Photograph: Christopher Zacca, CEO, Sagicor

Caribbean Money Daily

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