Sygnus Credit Investments (SCI) is reporting a 34 per cent increase in net profits for the year ended June 30, 2023, closing on US$5.13 million coming from US$3.82 million for the comparative period in 2022.

Tax charge for the year reached US$136,203, up from US$96,373 in 2022. For the June 2023 fourth quarter, profit declined from US$991,587 in 2022 to US$849,118 for the period under review.

Consequently, earnings per share (EPS) for the year amounted to US$0.0087 (2022: EPS: US$0.0065), while EPS for the quarter amounted to US$0.001 (2022: EPS: $0.002). Notably, SCI Jamaican dollar and US stock prices closed trading on Friday at prices of J$11.47 and US$0.092 with corresponding P/E ratios of 8.50x and 10.59x respectively.

Modest surge in interest income

SCI reported a 43 per cent increase in interest income totaling US$12.62 million compared to US$8.83 million in the corresponding period last year. Interest income for the fourth quarter had a 122% increase to close at US$3.51 million compared to US$1.58 million for the comparable quarter of 2022.

Interest expense amounted to US$5.95 million (2022: US$3.11 million), which represents an increase of 91 per cent year over year. Consequently, net interest income went up 15 per cent to US$8.14 million compared to US$7.10 million for June 30, 2022.

The company booked net interest income of US$3.51 million for the fourth quarter versus US$1.58 million reported for the similar quarter of 2022. Fair value gains on investment declined by 71 per cent to total US$1.18 million.

Sygnus says, “this year’s figure primarily reflected a lower amount of new fair value assets being added to the balance sheet, which more than offset the fair value losses from adverse movement in interest rates against the existing assets on the balance sheet.”

Total revenue marginally down

Total revenue went down by 12 per cent to close at US$9.77 million (2022: US$11.12 million). Management fees increase by 22 per cent from US$1.93 million in 2022 to US$2.36 million in the period under review.

Performance fees totalled US$119,445 versus the US$50,939 reported a year prior. Net foreign exchange gain of US$146,069 was reported for the year relative to a loss of US$405,221 recorded a year prior.

SCI says “the movement in foreign exchange gains and losses was a general reflection of realised gains or losses on FX transactions (buying or selling) and unrealised gains or losses from the group’s net exposure to Jamaican dollars, which fluctuate based on movements in the JMD/USD exchange rate”.

Other expenses for the year ended June 30, 2023, amounted to US$892,042, a 35 per cent increase relative to US$659,117 reported in 2022. Other expenses for the fourth quarter amounted to US$216,489 (2022: US$198,367).

Total expenses amounted to US$4.50 million, a 38 per cent decrease from the corresponding period last year. (2022: $7.21 million).

Balance Sheet Highlights

SCI’s assets totalled US$163.86 million (2022: US$136.79 million). The increase in assets resulted mainly from a US$30.31 million increase in ‘Investments’, which closed at US$151.21 million.

Shareholder’s equity was US$69.81 million (2022: US$67.46 million), representing a book value per share of US$0.12 (2022: US$0.11).