PROVEN Group Limited (PGL) for the six months ended September reported reduced net profits of US$1.6 million when compared to the US$7.3 million it earned during the same period of last year.

Net profit attributed to the company’s shareholders also plummeted to US$1.7 million for the first half of the financial year in comparison to the near US$6 million earned at the end of September 2021. For the reporting quarter the company however turned unexpected net losses of US$592,665, a significant drop from the US$5.6 million it earned for the same quarter of 2021. Profit attributable to shareholders for the three month period lessened to US$33,858. Owing to these developments, the company’s directors like many other companies in recent times, have decided to forego on dividend payment for the quater as continued headwinds and a dwindling of its capital base affects business.

In its latest unaudited report to shareholders, the company said that its net profit out-turns largely reflects “the adverse impact on asset prices caused by an increasingly inflationary environment, accompanied by rising interest rates. Grain price increases over the period along with the integration of newly acquired companies were the other drivers influencing the performance for the period.”

“Despite these challenging headwinds, the business remains resilient and is already reaping the results of its strategic initiatives based on the initial third quarter to date performance,” the company’s directors noted.

Owing to the headwinds, some less than favourable results, particularly in the core banking and wealth divisions, spurred downturns in the portfolios of its Proven Wealth Limited, Proven Wealth (Cayman) Limited and Proven Bank (Cayman), which were impacted in one way or another as a result of continued challenges in the global environment.

PGL, which spans a wide portfolio of regional and international companies, operates through a number of subsidiaries and associate companies in the areas of financial services, real estate investments and private equity. For the review period, the key performance drivers were said to be in its core banking & wealth division, real estate and portfolio holdings.

Despite the tightened conditions, commendable performances were delivered by its Boslil Bank in St Lucia which registered an improved second-quarter results after delivering a net profit of US$1.2 million at the end of September. The bank’s total asset also increased by 6 per cent from US$331.1 million to US$349.2 million.

Through its real estate firm Proven Property Limited, the entity’s development sales and recurrent income model likewise allowed it to enjoy “an excellent second quarter as it was able to book a large percentage of sales from its Braemar Development.” Its portfolio of real estate holdings includes approximately five rental income properties and nine development projects, all at various stages of the development cycle. Some of them include: Bloomfield Commercial in Mandeville timed for completion in December 2023; Aashgo Warehouses in Cayman, in which it has a 67 per cent stake, expected in February 2023 and Kingston Gateway Warehouse Complex scheduled for completion in October 2023.

Within its portfolio holdings, companies such as Access Financial, Proven Holdings Limited and Roberts Manufacturing Limited all made marginal but noticeable contributions to the overall performance of the group.

Following the mixed result, PGL’s assets expanded to US$1.08 billion in September 2022, growing by 46 per cent, up from the US$741 million reported for September 2021. This, even while liabilities increased by 67 per cent to total US$933 million.

Net revenues for the period, however, climbed to US$28.3 million.