Barita predicts greater profitability for 2018

Friday, December 29, 2017

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Barita's Managing Director Ian McNaughton is predicting greater profitability for the investment company come 2018, despite a one-off impairment on the company's books for the financial year ending September 2017.

Barita, which ended the year with profits of $203 million for the group — Barita Investment Limited and Barita Unit Trust Management Company — posted $100.2 million as impairment on available-for-sale investments for the year ending 2017, compared to the $4.69 million the company reported a year earlier.

“We had invested in a start-up company and the revenue stream that we had expected to come in at a specific point in time was not forthcoming. So prudence dictated that we provide for this potential loss in our account so that, in the eventuality that it did become a loss, we would have already accounted for it,” McNaughton told the Jamaica Observer.

He said Barita foresees brighter days for the next financial year led by continued growth in unit trust funds, and increased revenue streams from trading of company assets.

“We will maintain our repo books in the context of declining interest rate environment. However, that still remains profitable,” he continued.

Barita, in its 2017 consolidated statement of comprehensive income, posted a decline in profit of $4.2 million year over year to total $203 million. The results reflected a 52 per cent decline in foreign exchange trading and translation gains to $45.5 million for 2017, led by appreciation in the local currency.

The company, however, saw increases in fees and commission of $132 million for year-end 2017 compared to a year earlier. The increase positively impacted net revenues which climbed 9.1 per cent to $1.1 billion.

Barita had assets totalling $15.8 billion, while liabilities stood at $13 billion. Cash and cash equivalents totalled $413 million at year-end.

The investment company is considering acquisition by a local non-competing entity. McNaughton was, however, tight-lipped on the details.

Barita, which trades as BIL on the Jamaica Stock Exchange, is a primary dealer and cambio dealer operating with a staff complement of more than 80 professionals from offices in New Kingston, Mandeville and Montego Bay. The company, which celebrated its 40th anniversary this year, remains one of the few financial entities founded and led by a woman.




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