Ansa McAL profits decline in turbulent year for regional conglomerateWednesday, April 28, 2021
BY DAVID ROSE
Despite being a diversified Caribbean conglomerate with a reach stretching past eight other countries other than its home state of Trinidad & Tobago, Ansa McAL Limited still ended up with a 10 per cent decline in total revenue of TT $5.92 billion ($131.77 billion) while its net profit attributable to shareholders fell by 34 per cent to TT $423.25 million ($9.42 billion) for its 2020 financial year (FY) ending December 31, 2020.
The group's revenue from Trinidad dipped by 12 per cent to TT $4.35 billion while its Barbados and other countries segment revenue dipped by five per cent and nine per cent, respectively. This was most pronounced in its automotive, trading and distribution which saw a 16 per cent decline to TT $2.11 billion with its insurance and financial services remaining the most resilient at TT $416.51 million.
Since cost of sales coming in 11 per cent lower at TT $3.51 billion, the company's gross profit only declined by nine per cent to TT $2.41 billion with the gross profit margin remaining at 40 per cent. The company's operating profit declined by 29 per cent to TT $751.73 million which was influenced by Ansa's lower investment securities revaluations, along with higher credit loss provisions despite all other major costs being lower during the period. Finance costs for the group declined by five per cent to TT $41.61 million.
The group's share of profit from its associates and joint ventures was two per cent lower at TT $13.2 million which was mainly driven by its 47 per cent decline in its associate's profits. Ansa's joint venture with the MPC Caribbean Clean Energy Fund in CCEF ANSA Renewable Energies Holdings Limited (CARE) saw revenue jump by 231 per cent to TT $44.4 million with its net loss shrinking significantly to TT $1.1 million. CARE owns the 21-MW wind farm Tailwind SA based in Costa Rica.
Due to taxation being 15 per cent lower at TT $219.5 million, Ansa McAL's consolidated net profit ended up 35 per cent lower at TT $503.82 million with earnings per share coming up to TT $2.46 versus TT $3.74 in the 2019 FY. Its 54 per cent controlled Berger Paints Jamaica subsidiary posted a $32 million net profit for its fourth quarter compared to the $11 million net loss. This was in spite of revenue for the overall FY declining by six per cent to $2.37 billion and net profit down by 60 per cent to $11.65 million. Its Ansa Merchant Bank (AMB) subsidiary saw its standalone net profit jump by 69 per cent to TT $158.9 million but consolidated net profit fall by 42 per cent to TT $162 million due to declining security valuations in its subsidiaries.
Total assets for Ansa McAL declined slightly to TT $15.7 billion ($351.68 billion) largely stemming from the five per cent decline in non-current assets which ended the period at TT $9 billion. Total liabilities for the period declined by six per cent to TT $6.74 billion while equity attributable to shareholders increased by four per cent to TT $8 billion.
In spite of what occurred in 2020, Chairman A Norman Sagba . Ansa McAL declared a TT $1.50 (TT $264.3 million) dividend while AMB declared a TT $0.75 (TT $64.2 million) dividend as final amount with respect to the FY.
“This acquisition signifies our long-term confidence in the economy of Trinidad and Tobago and our willingness to serve citizens in every area of their lives. We look forward to adding new and innovative products and services in the commercial banking landscape which will augment the array of financial services already provided in life and general insurance and merchant banking. We expect to enhance our insurance operations in Barbados upon completion of the integration of the Trident Insurance business, subject to final regulatory approvals. During the year we continued to accelerate investments in all areas of our operations, particularly in information technology, and we expect to see tangible improvements in customer service in the coming years, as a result of the implementation of these initiatives. We are indeed proud of how we have prevailed through this debilitating global pandemic and how we have reaffirmed our group as a resilient and socially responsible conglomerate, ideally positioned for recovery and a bright future. Thank you for your continued trust and support,” said Sagba.
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