1834 Investments recovers from COVID
Published:Thursday | December 24, 2020 | 12:15 AM
Despite the turbulence of the coronavirus pandemic that has battered the economy and roiled markets, 1834 Investments Limited says it has not only survived the worst of the crisis, but is showing signs of a return to good health.
“Our current bond holdings have recovered in full,” the company’s general manager, Terry Peyrefitte, told shareholders at their annual general meeting, held largely virtually last week.
“Equities have almost fully recovered and are up 30 per cent since the lows that we experienced in March,” Peyrefitte said.
To drive home the point that things are looking up, the company’s chairman, Joseph M. Matalon, sought to put the firm’s $5.27 million profit for the six months to September ($34.9 million in 2019), as well as last year’s net return of $40.6 million, into perspective.
“We see where we have a net operating margin of about 29 per cent. For an investment company, I would say that is a very healthy performance,” Matalon said, in response to a shareholder’s questions.
For the financial year up to March, 1834 Investments, the portfolio management outfit that emerged after Gleaner Company Limited merged its media assets with the RJR Group, returned an after-tax profit of approximately $40.6 million, a more than 700 per cent increase on the prior year. Earning per stock was 3.35 cents, compared to 0.46 cents in 2019. That was on revenue of $96 million, or an increase of 73 per cent on the prior year.
At March, the end of the financial year, 1834 had assets of approximately $1.5 billion, of which over $1.4 billion, or around 96 per cent, represented shareholders equity. The biggest chunk (46 per cent) of 1834’s portfolio was in cash and short-term instruments, followed by real estate (39 per cent) and bonds (eight per cent). Equities accounted for five per cent.
Peyrefitte said while COVID-19 introduced significant volatility into the investments market, the company was able to assess and realign its portfolio to facilitate recovery.