JMMB hits two-year profit target
Published:Wednesday | February 16, 2022 | 12:07 AM
JMMB Group has effectively hit its two-year profit target, with a quarter to spare.
“Who would have thought that going into COVID-19 that JMMB would have produced the best results,” said CEO Keith Duncan at the company’s’s investor briefing on Monday.
Two years ago, when the group bought a 22.7 per cent stake in regional insurance conglomerate Sagicor Financial, it said the acquisition would serve to double its profits to $9 billion by year ending March 2022.
Already JMMB has racked up $8.8 billion in net profit over the period, April to December 2021, and is expected to add to that in the January-March 2022 fourth quarter.
“We will definitely exceed that target,” said Duncan.
In fact, JMMB would already have surpassed the target, were it not for the method of accounting for Sagicor while its under audit.
“We have not reflected any earnings for October to December, as part of its audit process,” said Patrick Ellis, chief financial officer for JMMB Group Limited. “We will incorporate it in the next results. We expect it to continue on a positive trajectory,” he said.
JMMB’s net earnings are distributed geographically among Jamaica 40 per cent, Dominican Republic 29 per cent, Barbados, the home of Sagicor Financial, at 24 per cent, and the rest in Trinidad & Tobago.
Looking at the financial conglomerate’s performance in the third quarter alone, its profit doubled to $3.3 billion from to $1.6 billion a year earlier. The group benefited from some $7 billion in gains on securities trading during the period.
“We have performed really well over the last two years, over the last nine months, and over the last quarter. We are happy about this,” said Duncan.
More acquisitions are in the pipeline to diversify the group’s revenue streams. But inflation remains a major challenge to continued growth, said Duncan, while noting that the central banks in the Dominican Republic and Jamaica have already tightened up on liquidity by increasing interest rates.
“That holds implications for the investment business line,” he said, with reference to the group’s wealth and trading division, But higher interest rates should also benefit the banking division.
“So that means we can continue growing our business lines; we can continue our core growth while pursuing our M&A strategy,” Duncan said. “But we are looking to transition over the next couple of years.”
Through its banking arm, JMMB will start offering ePay prepaid cards to clients as part of its effort to grow its client base. Norbrook Transaction Services, a fintech company, will provide the platform for the ePay cards, JMMB Bank CEO Jerome Smalling said.