Mayberry profits from CPJ sale but still weighed down by losses

Investment bank Mayberry Group Limited reported improved September third-quarter 2024 results.

It resulted in the company earning $145 million net profit for shareholders for the September quarter, bettering the $986-million loss reported during the similar quarter a year earlier. The company booked asset sales and also, its investments lost less value during the quarter when compared to a year ago.

“The results in both periods continue to reflect the malaise in the stock market over recent years arising from the high interest rate and inflation environment,” said Mayberry in its quarterly report to shareholders. The company added that since the two successive interest rate reductions announced by the Bank of Jamaica in recent months, the outlook for portfolio improvement is “positive” for the medium term.

The central bank reduced its policy interest rate from 7.0 per cent to 6.5 per cent. It followed from two rate reductions, each at 25 basis points, announced in August and September. The policy rate stood at 0.5 per cent up to late 2021, but climbed fourteenfold to sop up inflation.

One of the primary contributors to Mayberry’s profit movement was the $1.6 billion in trading gains from the sale of its 20 per cent ownership stake in Caribbean Producers Jamaica Limited to AS Bryden Group, which acquired the shares for $2.3 billion. This sale offset other losses and provided a substantial boost to the company’s financials. Additionally, Mayberry’s unrealised losses on investments improved dramatically, thereby reducing the burden on its bottom line.

However, despite the third-quarter profit, the company remains in a net loss position for the year to date. Its losses stand at $560.9 million for the nine months ended September, an improvement of 19 per cent over the $693-million loss reported during the same period last year. The reduced year-to-date losses were mainly driven by improved trading performance and the reduction in unrealised investment losses.

Total operating income for the quarter saw a notable increase of 170 per cent year-over-year, climbing to $980.4 million. However, operating expenses also rose by 19 per cent, totalling $1.78 billion for the nine-month period, reflecting higher costs related to staff, depreciation, and impairment provisions.

Mayberry Group’s total assets grew by 5.0 per cent to $62 billion, up from $59 billion at the end of 2023. This was partly driven by increased loans and investment securities. From those assets, after discounting liabilities, its capital stood at $24.5 billion as at September, which was flat year-on-year. After discounting non-controlling interest, shareholder equity stood at $16 billion.

steven.jackson@gleanerjm.com