Barita Investments showed vastly improved numbers for the June quarter with profits of $99 million compared to $48.5 million in the same quarter last year. The June quarter numbers had no taxes applied compared to corporation tax of $22.5 million charged for the 2012.
The results swung the loss at the end of the March quarter to a profit of $78.6 million year-to-date for the current financial year, down from a profit of $191.5 million for the same period to June last year. The nine months results is a huge improvement over the loss reported for the six months to March this year. The improvement in the latest quarter came from a nearly $30 million increase in foreign exchange trading and gain on sale of investment of $47 million more than in 2012. However, net interest income fell from $119 million down to $78 million but this may be due to a shift of the investment portfolio to foreign currency denominated investments to take advantage of the weakness in the Jamaican dollar currency, rather than a permanent shift in reduction in net interest margins.
The improved June results seem to bear the fruits of what management indicated would be a diversification of revenue streams by increasing product offerings and growing non-interest income.
Barita Investments suffered a $240 million hit in February as they wrote off investment gains which related to the government’s bond swap. In a release to shareholders, the company in commenting on the March results, stated “without the impact of the National Debt Exchange, the financial performance would have surpassed the prior year to date profits of $143 million”.
March quarter | For the second quarter of the financial year, losses of $98 million were incurred and year-to-date $20 million. The company was able to grow income with the main drivers being dividends, which grew by $13 million, foreign exchange trading and translation gains with an increase of $78 million and unit trust operations. Operating expenses at the end of the second quarter were $240 million compared to $226 million for the same period of 2012.
Looking forward, earnings for this year which ends in September, is unlikely to match that of 2012 due to the debt swap charge. But looking beyond that one-off charge, the results from ongoing earnings make the stock a very attractive medium investment. Revenues could be boosted above normal as the indicators are that the stock market activities will pick up strongly going forward.
Barita is an investment bank with a stockbrokerage arm and unit trust operations. The company is listed on the Jamaican Stock Exchange. At the current price in the $2.32 range and with signs of the local stock market exhibiting increasing interest, investors could reap good returns from this stock in 2014, if not before.
Insider call | Barita Investments is an IC Insider Buy Rated stock.
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[…] company incurred a small loss in the last quarter having reported a profit of $78.6 million up to June. The figures also indicate a loss of $79 million on disposal of investments in the last quarter on […]