Guardian reports TT$65m loss on GAM Jamaica sale
Published:Wednesday | November 17, 2010 | 12:00 AM
Guardian Holdings Limited (GHL) made a loss of TT$65.7 million on the disposal of its asset management business in Jamaica, pushing the company into the red in the third quarter.
The "non-cash charge" from the sale of Guardian Asset Management Jamaica to Proven Investment Management was the main contributor to GHL's net loss of TT$6.4 million in the September quarter.
Outside of the one-off event, the company would have made a profit of TT$70.7 million.
For the nine-month period, Guardian reported higher gross-premium income of TT$3.47 billion (9M 2009: TT$3.02b) and a strong recovery from a loss of TT$644 million to net profit of TT$211 million in the current period.
A portion of those gains was due to the TT$28 million the company said it netted from the deal with the IFC that swapped out debt owed to the financing agency for equity in GHL.
The US$75 million deal gave IFC ownership of just under 29.7 million GHL shares.
As a consequence of the deal, Guardian said its debt to equity ratio has been cut from 71 per cent to 51 per cent; while debt to capital is down from 43 per cent to 34 per cent.
The company's liabilities amounted to TT$18 billion at December 2009 is now down to TT$16.9 billion.
Its capital base has improved from TT$3.3 billion to TT$4.09 billion.
Guardian said TT$397 million of new capital was from the IFC deal.
Looking ahead
But in its nine-month results, it incurred a small TT$6.4 million net loss. The one-off charge pushed Guardian into a net loss of TT$6.4 million during the third quarter.
But while the one-off charge said it netted TT$28 million from the deal with the IFC that swapped out a portion of its debt for equity.
Looking ahead, Guardian said it expects Hurricane Tomas to have little bearing on its fourth-quarter results.
"Fortunately, the storm packed more rain than wind, and we do not expect losses from this hurricane to have a mate-rial effect on year-end profits," said chairman Arthur Lok Jack in a statement to shareholders.
Lok Jack said Guardian expected to report earnings above TT$1.72 per share from continuing operations for the last quarter.