Profit jumps 58% at Proven

Investors in shares of PROVEN Investments pushed the price to a year’s low of 12 US cents last month but data now available suggest that they made a big mistake, as the stock now trades back at 20 US cents and profit that suffered from foreign exchange losses in the second half of 2018 fiscal year is now back up.
The investment bank just released first quarter results to June showing profit attributable to shareholders jumping 58.43 percent to US$1.79 million from the US$1.13 million in the same period last year. Annualized return on average equity translate to 8.56 percent and is consistent with Proven target set when they went public. The sharp jump in earnings resulted from net revenue for the quarter rising a 17.4 percent to US$8.5 million compared to US$7.25 million earned in the June 2017 quarter. According to the CEO Christopher Williams, “this was mainly due to a more efficient carry trade strategy and significant improvement in foreign exchange gains.”
Earnings per share for the quarter amounted to 0.29 US cent versus 0.20 US cents in 2017. An interim dividend of 0.25 US cent per share will be paid to shareholders on September 10.
According to the report released with the financials “spread income was the major contributor to revenue during the period, with a 16.97 percent improvement compared with the same period last year as net interest income totalled US$5.28 million. This increase reflects success in the carry trade strategy as the company was able to concurrently increase interest income while reducing interest expense by 18.30 percent.
Net foreign exchange gains totalled US$1.20 million, compared to just US$200,000 in the same period last year. While foreign exchange grew fees and commission income declined from $1.2 million to $894,000 due to change in reporting some fee income with some income now being booked over the period that they cover rather than at the time of billing, the impact for the full year should not reflect a major difference, IC Insider.com was informed.
Proven invests in a number of privately held entities except for Access Finance. The investment strategy seems to be working with most entities delivering increased returns in the quarter.

Christopher Williams, Proven Investments CEO.

According to the release Proven Wealth net income totalled US$0.93 million for the quarter, representing more than a six -times increase compared to the same period last year. The firm continues its strategy to offer investment products to clients in reducing the previous reliance on repurchase agreements. Total Assets of the company as at June 2018 stood at US$120.5 million.
Proven Fund Managers continues to be one of the top players in the Asset and Pension Fund Management and Administration business. Profitability increased by almost 68 percent compared to the same period last year, with net profit of US$220,000 compared to US$130,000 million for 2017.
Access Financial Services appears to be maturing contributing nearly 21 percent increase in net profits attributable to PIL of US$790,000 or 44 percent of the group’s profit for the quarter. But according to Williams, profit at Access is growing around $10 million on a monthly basis and is expected to continue for the rest of the fiscal year barring unforeseen negative development. IC Insider.com gathers that they may be more acquisition in the period ahead for this subsidiary in a new market. Access seems to have absorbed the acquisitions last year that led to a hike in doubtful loan provisioning being above normal in the 2018 fiscal year. The loan portfolio was US$24.4 million up 22 percent over the balance at June 2017.
BOSLIL Bank headquartered in St Lucia is Proven Investments’ most recent acquisition and currently 75 percent owned by the group. BOSLIL contribution to group profits was just below Access at US$610,000 million. Total Assets of the bank stood at US$271 million and seems set to increase as the group has signed an agreement to acquire yet another banking entity that will fall under the arm of Boslil.
PROVEN REIT is involved in residential real estate development with two new developments scheduled to commence construction and are expected to be completed and sold over the next twelve to eighteen months. But the current fiscal year is not likely to benefit from these is they are successfully executed.
Operating expenses increased by 11.5 percent to US$5.6 million compared to US$4.9 million in 2017 but the expenses include US$236,000 in preference dividends that will not repeat as the company retires the preference shares on which dividend was paid while there was just over $400,000 provision made relating to the impact of IFRS 9. Excluding these two items profit for the quarter would have been much greater than reported.

Access Financial contributed much to Proven profit in the quarter.


At the end of June total assets amounted to US$575 million down slightly from US$599 million at June 2017 and liabilities fell from US$509 million in 2017 to US$470 million. Shareholders’ Equity grew to US$82 million from US$71 million as at June 2017 mainly from increased in the share capital following the rights issue last year.
The group has not been able to put the new capital fully to work as they awaited regulatory approval for the plan acquisition of a brokerage company in Cayman Island which has now been granted with the acquisition said by Proven to close at the end of the month. That may not be the only acquisition for Proven this fiscal year as the group seek to grow its overseas business and take advantage of the many investment opportunities management sees within the region.
In going forward, investors need to pay attention to the impact of foreign exchange trading and movement in the rate of exchange and the impact on profits positively or negatively, so the strong gains enjoyed in the quarter may not repeat in the rest of the year. The preference dividend and the provision for IFRS provisioning should not repeat and are likely to reduce cost going forward. Access continues to grow profit on a quarterly basis as the company increase loans granted and securities trading can add or subtract from profits depending how well the investment portfolio is managed.
With the continued focus on acquisition, the future could be brighter for the group, in addition IC Insider.com is forecasting a rise in the PE ratio from an average of 12.5 now to a higher level by year end.
The stock that was in the IC TOP 10 and slipped out this past week traded at 19 US cents on Thursday on the JSE US dollar market and sits just outside the Top list.

Jamaican dollar gains

Dealers in the foreign market bought US$36.76 million in US currency at an average rate of J$132.05, down $1.24 from Tuesday’s rate of $133.29.
The selling rate for the US dollar declined from J$134.05 on Tuesday as US$50.77 million was sold at an average rate of J$133.60 including US$5 million sold to Bank of Jamaica in the B-FXITT Standard Intervention Tool – buy operation, at an average J$133.65. At mid-day on Wednesday the average selling rate was $133.49 with only US$12.3 million then sold.
Overall foreign currencies purchased by dealers amounted to US$41.44 million, while selling accounted for $58 million for a net outflow of just under US$17 million. On Tuesday, net inflows of US$14 million came into the market, but for the US dollar currency, net inflows amounted to US$17 million.
For the next four weeks, the central bank will buy US$5 on Wednesday July 31 and August 8 and will sell $10 million to the market on August 19.

BOJ buys $5m at J$133.65

The rate Bank of Jamaica paid on Wednesday, July 25 to purchase US$5 million in the B-FXITT Standard Intervention Tool – buy operation average J$133.65.
Eligible dealers placed bids to buy only $5.5 million with the highest priced offer at 137.24 to sell $200,000 and the lowest at $126 for $200,000. BOJ purchased funds as high as $137.10 amounting 40 percent of the amount offered while the amount of $350,000 that was offered at $137 was fully taken up. Eligible Offers were received from 19 sellers while 18 had funds bought.
The central bank will buy US$5 on Wednesday July 31 and August 8 and will sell $10 million to the market on August 19.

Jamaican Dollar falls to $134.05 to US$

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BOJ will buy US$5M from the market on Wednesday.

The Jamaican dollar jumped to an average of $134.05 when trading closed in the foreign exchange market on Tuesday up from $133.39 on Monday with inflows greater than inflows.
Foreign exchange dealers bought the equivalent of $66 million and sold US$51 million on Tuesday with the United states dollar accounting for US$60.4 million of the purchased amount and US$43.6 million of sales, a difference of US$17 million.
Similar to Monday when the purchase of US dollars were even with the sales with a total of US$44 million bought and US$44.5 million sold of all currencies, the rate paid by the public to purchase the US dollar jumped over the closing rate on Friday.
On Friday last US$37 million was purchased by dealers of all currency including US$35.5 million in US currency and US$27 million in US currency was sold at an average rate of $132.96, as a total of US$28 million sold of all currencies.
Based on the schedule of intervention by Bank of Jamaica, the central bank will buy US$5 million from the market on Wednesday to be followed by similar amounts on August 2, and August 8.

BOJ buying pushed US$ rate

The official selling rate for the US dollar ended at J$130.47 on Wednesday, rising from $130.06 on Tuesday as sale to Bank of Jamaica under its foreign exchange auction, absorbed US$10 million at an average weighted rate of $131.17.
In Wednesday’s foreign currency trading, dealers bought just over US$27 million at an average rate of J$128.79 and sold over $35.4 million. Overall US$29.4 million of all currencies were bought by dealers and they sold US$38.2 million.
Dealers attempted to sell US$11.35 million to BOJ at rates as high as $134, for US$200,000 and as low as $126.80 for US$1 million. BOJ accepted all bids up to $132.93 and partially up to $133.
BOJ has been buying funds from the market from April when they started the buy side of the BFXITT auction.
On July 11, the central bank will sell US$5 million to the market and buy US$5 million on July 25. In April US$32 million was bought from the market, by BOJ, US$35 million was purchased in May and in June US$19 million. At the auction of Wednesday June 13, the central bank offered to purchase US$10 million buy only US$9 million was offered, the average rate ended at J$132.66 with the highest rate clearing at $133.50. On the June 13, the selling rate in the daily foreign exchange market jumped J$1.29 to JS$131.58 for US$1, a direct result of the BOJ buying, the rate moved even higher on the 14th even as inflows were more than sales on that day.
The central banks purchases helped to steer the Net International Reserves US$69 million higher in May to US$3.175 billion and also grew in April as well from US$3.075 billion at the end of March. At the end of February the NIR was US$3.18 billion.
July and August are two of the months with strong inflows of foreign exchange, but with summer being the prime time of Jamaicans to travel overseas demand tends to be high as well.

Jam$ falls vs US rise with others- Wednesday

The Jamaica dollar slipped moderately in value at the close of foreign currency trading on Wednesday against the US dollar but gained against the others.
Inflows of all currencies amounted to the equivalent US$30.57 million compared to US$37.57 million bought on Tuesday and sold US$42.74 million compared to US$42.54 million sold on Tuesday.
At the close of foreign currency trading, dealers sold US$41.45 million, 5 cents more than on Tuesday with the US dollar selling rate closing at J$125.42, compared to J$125.37 in the sale of US$40.38 million on Tuesday. Purchases of the US currency by dealers, amounted to US$28.57 million, with the average rate adding 4 cents to end $124.04, compared to US$35.51 million, with the average rate of $124 on Tuesday.
At mid-day on Wednesday dealers purchased US$13.07 million at an average rate of J$124.36 and sold $14.19 million at an average of J$125.26. At mid-day on the previous trading day, dealers purchased US$ US$13.07 million at an average rate of J$124.36 and sold $14.19 million at an average of J$125.26.
The Jamaican dollar closed trading, with the selling rate for the Canadian dollar, falling to J$97.43 from J$100.50 at the close on Tuesday. The selling rate for the British Pound declined to J$167 from J$171.54 previously and the euro declined versus the Jamaican dollar to J$151.76 to buy the European common currency, versus the prior selling rate of J$152.19.

Jamaican$ falls in value – Tuesday

The Jamaica dollar slipped moderately in value at the close of foreign currency trading on Tuesday against all the main currencies it mostly trade against, except the pound.
Inflows of all currencies amounted to the equivalent US$37.57 million compared to US$63.21 million bought on Monday and sold US$42.54 million compared to US$63.48 million sold on Monday.
At the close of foreign currency trading, dealers sold US$40.38 million, 5 cents more than on Monday with the US dollar selling rate closing at J$125.37, compared to J$125.32 in the sale of US$46.64 million on Monday. Purchases of the US currency by dealers, amounted to US$35.51 million, with the average rate falling 33 cents to $124, compared to US$58.09 million, with the average rate of $124.33 on Monday.
At mid-day on Tuesday dealers purchased US$13.07 million at an average rate of J$124.36 and sold $14.19 million at an average of J$125.26. At mid-day on the previous trading day, dealers purchased US$25.27 million at an average rate of J$124.58 and sold $19.78 million at an average of J$125.24.
The Jamaican dollar closed trading, with the selling rate for the Canadian dollar, rising to J$100.50 from J$98.23 at the close on Monday. The selling rate for the British Pound declined to J$171.54 from J$172.28 previously and the euro rose versus the Jamaican dollar to J$152.19 to buy the European common currency, versus the prior selling rate of J$151.70.

Jamaican$ gains against all – Monday

The Jamaican dollar gained further ground at the close of foreign currency trading on Monday against all the four main currency it mostly trade against daily.
Inflows of all currencies amounted to the equivalent US$63.21 million compared to US$35.26 million bought on Friday and sold US$63.48 million compared to US$37.86 million sold on Friday.
At the close of foreign currency trading, dealers sold US$46.64 million, 21 cents less than on Friday with the US dollar selling rate closing at J$125.32, compared to J$125.53 in the sale of US$29.69 million on Friday. Purchases of the US currency by dealers, amounted to US$58.09 million, with the average rate rising 58 cents to $124.33, compared to US$29.47 million, with the average rate of $123.75 on Friday.
At mid-day on Monday dealers purchased US$25.27 million at an average rate of J$124.58 and sold $19.78 million at an average of J$125.24. At mid-day on the previous trading day, dealers purchased US$8.2 million at an average rate of J$124.37 and sold $7.46 million at an average of J$125.44.
The Jamaican dollar closed trading, with the selling rate for the Canadian dollar, declining to J$98.23 from J$100.96 at the close on Friday. The selling rate for the British Pound declined to J$172.28 from J$174.70 previously and the euro fell versus the Jamaican dollar to J$151.70 to buy the European common currency, versus the prior selling rate of J$152.09.

More recovery for Jamaican$ – Friday

The Jamaica dollar gained further ground at the close of foreign currency trading on Friday against the US and the Canadian dollars and the euro as volumes increased over the previous week.
Dealers bought US$201 million in all currencies, up from US$191 million bought in the previous week and sold US$217 million, compared to US$210 million in the prior week. Actual US dollar purchases by dealers amounted to US$178 million from US$166 million in the prior week and sold US$190 million including US$15 sold to Bank of Jamaica in the BFXITT auction, compared to US$184 million previously.
Inflows of all currencies amounted to the equivalent US$35.26 million compared to US$34.79 million bought on Thursday and sold US$37.86 million compared to US$31.28 million sold on Thursday.
At the close of foreign currency trading, dealers sold US$29.69 million, 4 cents less than on Thursday with the US dollar selling rate closing at J$125.53, compared to J$125.57 in the sale of US$27.16 million on Thursday. Purchases of the US currency by dealers, amounted to US$29.47 million, with the average rate dropping 55 cents to $123.75, compared to US$32.90 million, with the average rate of $124.30 on Thursday.
At mid-day on Friday dealers purchased US$8.2 million at an average rate of J$124.37 and sold $7.46 million at an average of J$125.44. At mid-day on the previous trading day, dealers purchased US$12.17 million at an average rate of J$124.70 and sold $7.66 million at an average of J$125.49.
The Jamaican dollar closed trading, with the selling rate for the Canadian dollar, declining to J$100.96 from J$101.70 at the close on Thursday. The selling rate for the British Pound rose to J$174.7 from J$173.57 previously and the euro fell versus the Jamaican dollar to J$152.09 to buy the European common currency, versus the prior selling rate of J$152.63.

Jamaican$ recovers from B-Fxitt effect – Thursday

The Jamaica dollar recovered on Thursday from some of the losses suffered when dealers sold US dollars to Bank of Jamaica in the B-FXITT auction that helped to push up the selling rate on Wednesday.
Inflows of all currencies amounted to the equivalent US$34.79 million compared to US$38.04 million on Wednesday and sold US$31.28 million compared to US$55.58 million, including the amount sold to Bank of Jamaica on Wednesday.
At the close of foreign currency trading, dealers sold US$27.16 million, for 16 cents less than on Wednesday with the US dollar selling rate closing at J$125.57, compared to J$125.73 in the sale of US$52.03 million on Wednesday. Purchases of the US currency by dealers, amounted to US$32.90 million, with the average rate climbing 26 cents to $124.30, compared to US$32.44 million, with the average rate of $123.94 on Wednesday.
At mid-day on Thursday dealers purchased US$12.17 million at an average rate of J$124.70 and sold $7.66 million at an average of J$125.49. At mid-day on the previous trading day, dealers purchased US$14 million at an average rate of J$124.51 and sold $18.42 million at an average of J$125.38.
The Jamaican dollar closed trading, with the selling rate for the Canadian dollar, jumped to J$101.70 from J$97.54 at the close on Wednesday. The selling rate for the British Pound declined to J$173.57 from J$174.67 previously and the euro fell versus the Jamaican dollar to J$152.63 to buy the European common currency, versus the prior selling rate of J$154.27.