FOLLOWING a one-third haircut to its net profit, Pulse Investments Limited continues to overhaul its traditional modelling business while transforming its Villa Ronai property into a five-star resort.

Pulse saw its net profit decline from $542.95 million to $357.65 million as the company saw a reduction in all of its reported revenue lines, which occurs with the reset of the model agency and sponsorship business.

The company which reported $513.99 million in advertising entitlements and in-kind sponsorship in the June 2024 financial year (FY) had no recognition of these items in 2025. Cash sponsorship and branding also fell from $77.38 million to $3.45 million with the model agency income dipping from $66.53 million to $2.70 million.

“This reduction reflects, in large part, the decision to cease recognising new advertising entitlements as revenue until the company is better able to demonstrate consistent monetisation of these balances, together with lower model agency income and the absence of in kind sponsorship income recognised in the prior year,” said co-founder and chairman Hilary Phillips in the company’s June 2025 annual report.

The only revenue source which maintained stability was the property rental income from its Trafalgar Road and Villa Ronai properties which contributed $151.35 million, a four per cent reduction from $157.20 million. Trafalgar Road is home to a range of commercial offices and Pulse Rooms which received an upgrade in the 2025 FY to its amenities and offerings. Villa Ronai is home to Pulse Lofts which is a 16-unit development that individuals can rent or purchase while Pulse Homes was a planned housing development. These investment properties were worth $8.69 billion in June 2025.

“While profitability was lower, the company remained solidly profitable in a year marked by deliberate de risking decisions, a reset of certain revenue streams, and a sharpening of our strategic focus on hospitality and lifestyle real estate,” Phillips added.

Pulse traditionally hosted Caribbean Fashion Week for 19 years straight until COVID-19 disrupted the annual event. With the shift that has taken place in the global media landscape in recent years, the company pointed to the less than impactful financial returns and a need to have future stagings in a leaner, more digital or hybrid format.

Pulse’s model search and other projects also brought it economic value through its advertising entitlements which remains its second largest asset worth $2.23 billion. This was a non-cash consideration asset which was earned via TV and media content for broadcasting partners.

“Cease recognising new advertising entitlements as revenue until it can demonstrate a consistent and reliable track record of monetising previously recognised balances.”

Managing Director Cooper envisions the next phase of the model agency being digital first, data informed and having deeper integration with the media and hospitality assets.

Pulse Homes was a 30-unit residential project that was expected to be completed in 2024. However, that project has been set aside as the company focuses on renewing the Villa Ronai property as a five-star resort. The company tapped veteran hotel professional Dimitris Kosvogiannis to lead this initiative.

However, this initiative also hinges on discussions with Barita Investments Limited (arranger) and JCSD Trustee Services Limited (trustee) on restructuring the company’s $803.64-million bond. The undrawn portion of the bond amounts to $273.30 million.

Pulse’s audited financials revealed that no contractual interest or principal payments were made under the original payment schedule in the 2025 FY. The company’s interest reserve account was empty, a decline from the $31.03 million in 2023, no formal amendments to the bond has been executed and the trustee has not demanded repayment.

“Subject to stable macroeconomic conditions and constructive engagement with financing partners, Pulse is confident in its ability to unlock further value from its property portfolio and to build a compelling, profitable 5-star hospitality and lifestyle business anchored at Villa Ronai and Trafalgar Road,” the annual report stated.

Pulse is currently in a transition mode as Managing Director Safia Cooper and co-founder Phillips look towards a new direction for the company which lost its co-founder and chairman Kingsley Cooper in June 2024. Romae Gordon, former partner to Kingsley, resigned as co-managing director and company secretary in March while former director and audit committee chairman Jeffrey Cobham passed away in August. Gordon previously oversaw the fashion and lifestyle area of the business.

With Pulse’s board seeing the departure of two directors, the four member-board will need to expand its board in the future to meet certain regulatory requirements. The JSE’s Main Market rules requires the audit committee of listed companies to have at least three independent directors. Phillips and Eleanor Brown are the only members of the company’s audit committee.

Pulse’s asset base improved two per cent to $12.10 billion for the 2025 FY, but current assets declined 67 per cent from $112.35 million to $37.67 million. The company did not generate cash from its operations and tapped on the bond to support its cash balance which ended at $33.58 million. Pulse’s total liabilities stood at $2.48 billion with current liabilities at $204.93 million while shareholder’s equity increased four per cent to $9.61 billion.

Pulse’s stock closed at $1.17 on Tuesday which left it up two per cent in 2025 with a market capitalisation of $7.63 billion. The company’s stock has traded as high as $1.50 and as low as $0.72 in the last year. Pulse’s first quarter report (July to September) remains outstanding. The company will also host its annual general meeting at 10:30 am on April 9 at its Villa Ronai property.