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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Sagicor Financial Corporation Limited | LSE:SFI | London | Ordinary Share | BMG7777B1046 | COM SHS USD0.01 (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 117.50 | 105.00 | 130.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMSFI
RNS Number : 6270H
Sagicor Financial Corporation Ltd
16 November 2018
SAGICOR FINANCIAL CORPORATION LIMITED
FINANCIAL RESULTS
FOR THE NINE MONTHSED SEPTEMBER 30, 2018
The Sagicor Group had a resilient performance despite significant adverse events in the regional and international markets, namely, credit losses on Government of Barbados debt, mark-to-market losses on our international bonds and the devaluation of the Jamaican dollar to the US dollar.
The Sagicor Group net income for the nine months to September 30, 2018 was US $59.0 million, compared to a prior year result of US $85.8 million. Group net income attributable to shareholders was US $31.7 million, compared to a prior year result of US $54.8 million.
During the period the Sagicor Group adopted two new accounting standards which became effective from January 1, 2018. IFRS 15, Revenue from Contracts with Customers was adopted, and affects how income is recognised on contracts by companies. IFRS 9, Financial Instruments, was also adopted. This accounting standard changes the way that financial instruments are recognised and measured. The standard introduces new measurement categories for financial instruments and an expected credit loss model for impairment.
On September 7, 2018 the Government of Barbados (GoB) entered into a Staff-Level Agreement with the International Monetary Fund (IMF) to provide financial and technical assistance. As part of the programme, the GoB launched a Debt Exchange Offer for GoB Domestic Barbados dollar debt holders on September 7, 2018. The GoB announced on October 15, 2018 that its Exchange Offer received unanimous support from the domestic creditors. A restructuring plan has not yet been announced for the External US dollar denominated debt. The Sagicor Group holds approximately US $337 million in GoB debt, of which US $278 million is Domestic Barbados-dollar denominated debt. The Sagicor Group has determined the net impact of the credit events on GoB debt to shareholders at approximately US $43 million, as at September 30, 2018 (gross expected credit loss was US $101 million less actuarial offsets).
Total revenue for the Group was US $1,068.7 million, compared to a prior year amount of US $910.9 million, an increase of 17%. The growth in revenue was mainly due to the growth in premiums in the USA segment, where the gross premiums were US $263.5 million compared to US$ 133.7 million for the same period in the prior year, an increase of 97%.
Benefits were US $537.4 million compared to US $475.1 million for the prior year an increase of 13%. The increase was largely driven by the growth in new business and changes in the interest rate environment.
Expenses were US $443.0 million, compared to US $329.1 million for the same period in the prior year, an increase of 35%. Expenses include the provision for losses on all assets arising from the adoption of IFRS 9, and this result was largely driven by the provision for the Government of Barbados securities.
Group comprehensive income was a loss of US $6.6 million, compared to income of US $108.4 million for the prior year. Shareholder comprehensive income was a loss of US $6.8 million compared to income of US $70.1 million for the prior year. The decline in shareholder comprehensive income was mainly due to marked to market declines on our international bond portfolio, and the impact of the devaluation of the Jamaican dollar relative to the US dollar of US$ 35.1 million, compared to the prior year.
Group assets were US $6.8 billion and Group liabilities were US $5.9 billion. Group equity was US $895.9 million, compared to US $888.6 million for the prior year. Shareholders' equity was US $598.1 million, compared to US $601.0 million for the prior year.
The Group's debt was US $404.4 million with a debt-to-capital ratio of 31.1%, compared to 31.3% for the prior year.
On behalf of the Board of Sagicor, I wish to thank our stakeholders for their continued support.
Stephen McNamara
Chairman
November 15, 2018
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FINANCIAL HIGHLIGHTS Nine months ended
September 30
(in US currency except percentages)
2018 2017 restated
--------------------------------------------------- ---------- --------------
Total revenue $1,068.7m $910.9m
Overall Group net income $59.0m $85.8m
Overall Shareholders' net income $31.7m $54.8m
Net income allocated to non-controlling interests $35.0m $32.7m
--------------------------------------------------- ---------- --------------
Total equity $895.9m $888.6m
--------------------------------------------------- ---------- --------------
Book Value per share $1.98 $1.96
--------------------------------------------------- ---------- --------------
Ratio of Debt to Capital 31.1% 31.3%
--------------------------------------------------- ---------- --------------
Earnings per common share 10.3c 18.0c
Annualised return on common shareholders'
equity 6.4% 11.4%
--------------------------------------------------- ---------- --------------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Amounts expressed in September September December January
US $000 30 30 31 01
2018 2017 2017 2017
RESTATED RESTATED RESTATED
(unaudited) (unaudited)
--------------------------- ------------------ ---------------- -------------------- ---------------
ASSETS
Financial investments 5,077,123 5,005,199 4,953,241 4,813,748
Other investments and
assets 1,730,970 1,766,441 1,851,291 1,718,172
Assets of discontinued
operation 13,301 8,225 10,110 -
Total assets 6,821,394 6,779,865 6,814,642 6,531,920
------------------ ---------------- -------------------- ---------------
LIABILITIES
Policy liabilities 3,590,893 3,474,600 3,547,877 3,356,522
Other liabilities 2,334,648 2,416,630 2,329,542 2,375,883
Total liabilities 5,925,541 5,891,230 5,877,419 5,732,405
------------------ ---------------- -------------------- ---------------
EQUITY
Shareholders' equity 598,107 601,004 624,592 537,080
Participating accounts (10,528) 637 865 1,291
Non-controlling interests 308,274 286,994 311,766 261,144
Total equity 895,853 888,635 937,223 799,515
------------------ ---------------- -------------------- ---------------
Total liabilities and
equity 6,821,394 6,779,865 6,814,642 6,531,920
--------------------------------------- ------------------ ---------------- -------------------- ---------------
These financial statements have been approved for issue by the
Board of Directors on November 15, 2018.
CONSOLIDATED STATEMENT OF INCOME
Amounts expressed in US Nine months to Three months to
$000 September 30 September 30
2018 2017 2018 2017
RESTATED RESTATED
(unaudited) (unaudited) (unaudited) (unaudited)
----------------------------------- --------- --- ---------------- -------------- ------------ ------------
REVENUE
Net premium revenue 720,000 558,804 309,970 218,659
Net investment and other
income 348,717 352,125 120,188 129,630
Loss arising on disposal (13) - (13) -
Total revenue 1,068,704 910,929 430,145 348,289
---------------- -------------- ------------ ------------
BENEFITS AND EXPENSES
Benefits 537,381 475,149 238,965 195,724
Expenses 442,958 329,148 156,040 104,848
Total benefits and expenses 980,339 804,297 395,005 300,572
---------------- -------------- ------------ ------------
INCOME BEFORE TAXES 88,365 106,632 35,140 47,717
Income taxes (32,591) (29,027) (15,396) (10,235)
NET INCOME FROM CONTINUING
OPERATIONS 55,774 77,605 19,744 37,482
Net income / (loss) from discontinued
operation 3,191 8,225 (166) 2,017
NET INCOME FOR THE PERIOD 58,965 85,830 19,578 39,499
----------------
NET INCOME ATTRIBUTABLE
TO:
Common Shareholders
From continuing operations 28,541 46,536 6,998 28,554
From discontinued operation 3,191 8,225 (166) 2,017
31,732 54,761 6,832 30,571
Participating policyholders (7,722) (1,595) 588 (1,121)
Non-controlling interests 34,955 32,664 12,158 10,049
58,965 85,830 19,578 39,499
----------------
Basic earnings per common
share:
From continuing operations 9.3 cents 15.3 cents 2.3 cents 9.4 cents
From discontinued operation 1.0 cents 2.7 cents (0.1) cents 0.7 cents
-------------- ------------
10.3 cents 18.0 cents 2.2 cents 10.1 cents
---------------- -------------- ------------ ------------
Fully diluted earnings per
common share:
From continuing operations 9.1 cents 15.0 cents 2.2 cents 9.2 cents
From discontinued operation 1.0 cents 2.7 cents (0.1) cents 0.6 cents
---------------- -------------- ------------ ------------
10.1 cents 17.7 cents 2.1 cents 9.8 cents
----------------------------------- --------- --- ---------------- -------------- ------------ ------------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Amounts expressed in US $000 Nine months to Three months to
September 30 September 30
2018 2017 2018 2017
RESTATED RESTATED
(unaudited) (unaudited) (unaudited) (unaudited)
------------------------------------- ------------ ------------ ------------ ------------
NET INCOME FOR THE PERIOD 58,965 85,830 19,578 39,499
------------ ------------ ------------ ------------
Items net of tax that may
be reclassified subsequently
to income:
Available for sale financial
assets:
Unrealised gains arising
on revaluation - 36,670 - 14,983
Losses / (gains) transferred
to income - 6,052 - (1,159)
Net (losses) / gains on
investments in debt instruments
measured at FVOCI (57,623) - 7,490 -
Net (gains) on financial
assets measured at FVOCI
reclassified to profit or
loss on disposal (964) - 785 -
Net change in actuarial liabilities 27,297 (17,195) (2,577) (4,280)
Retranslation of foreign
currency operations (34,946) (5,217) (17,164) (3,360)
(66,236) 20,310 (11,466) 6,184
Items net of tax that will
not be reclassified subsequently
to income:
Unrealised gains / (losses)
arising on revaluation of
owner occupied property 816 - (16) -
Net losses on investments
in equity instruments designated
at fair value through other
comprehensive income (173) - (200) -
Gains on defined benefit
plans - 2,227 2,500 94
OTHER COMPREHENSIVE (LOSS)
/ INCOME FOR THE PERIOD (65,593) 22,537 (9,182) 6,278
------------ ------------ ------------ ------------
TOTAL COMPREHENSIVE (LOSS)
/ INCOME FOR THE PERIOD (6,628) 108,367 10,396 45,777
------------ ------------ ------------ ------------
TOTAL COMPREHENSIVE (LOSS)
/ INCOME ATTRIBUTABLE TO:
Common Shareholders
From continuing operations (10,035) 61,913 2,941 30,283
From discontinued operation 3,191 8,225 (166) 2,017
(6,844) 70,138 2,775 32,300
Participating policyholders (8,307) (492) 754 (328)
Non-controlling interests 8,523 38,721 6,867 13,805
(6,628) 108,367 10,396 45,777
------------------------------------- ------------ ------------ ------------ ------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Amounts expressed Share Share Reserves Retained Participating Non-controlling
in US $000
(unaudited) Capital Premium Earnings Accounts Interest Total
-------------- ---------- -------- -------- --------- --------- -------------- ---------------- ------------
Nine months to
September 30, 2018:
Balance, beginning
of period 3,059 300,470 (47,482) 367,327 865 308,089 932,328
Prior period
adjustment - - 94 1,124 - 3,677 4,895
Balance as of December
31, 2017 restated 3,059 300,470 (47,388) 368,451 865 311,766 937,223
January 1, 2018
adjustment-change
on initial
application
of IFRS 9 - - (217) (10,442) (2,930) (2,352) (15,941)
Balance as of January
1, 2018 3,059 300,470 (47,605) 358,009 (2,065) 309,414 921,282
Total comprehensive
income from continuing
operations - - (38,576) 28,541 (8,307) 8,523 (9,819)
Total comprehensive
income from discontinued
operation - - - 3,191 - - 3,191
Transactions with
holders of equity
instruments:
Movements in treasury
shares - 1 - - - - 1
Changes in reserve
for equity
compensation
benefits - - (750) - - - (750)
Disposal of interest
in subsidiaries - - (935) 935 - (2,221) (2,221)
Dividends declared - - - (7,648) - (10,237) (17,885)
Transfers and other
movements - - (45) (540) (156) 2,795 2,054
Balance, end of
period 3,059 300,471 (87,911) 382,488 (10,528) 308,274 895,853
-------------------------- -------- -------- --------- --------- -------------- ---------------- ------------
Nine months to September
30, 2017 RESTATED:
Balance, beginning
of period 3,029 297,050 (64,795) 300,865 1,291 257,974 795,414
Prior period adjustment - - (3) 934 - 3,170 4,101
Balance
as restated 3,029 297,050 (64,798) 301,799 1,291 261,144 799,515
Total comprehensive
income from continuing
operations - - 13,173 48,740 (492) 38,721 100,142
Total comprehensive
income from discontinued
operation - - - 8,225 - - 8,225
Transactions with
holders of equity
instruments:
Allotment of common
shares 21 2,021 - - - - 2,042
Movements in treasury
shares 6 834 - - - - 840
Changes in reserve
for equity compensation
benefits - - (45) - - - (45)
Dividends
declared - - - (7,575) - (10,840) (18,415)
Transfers and other
movements - - 1,226 (2,702) (162) (2,031) (3,669)
-------- -------- --------- --------- -------------- ----------------
Balance, end of
period 3,056 299,905 (50,444) 348,487 637 286,994 888,635
-------------------------- -------- -------- --------- --------- -------------- ---------------- ------------
CONSOLIDATED STATEMENT OF CASH FLOWS
Amounts expressed in US $000 Nine months to September
30
2018 2017 RESTATED
(unaudited) (unaudited)
------------ --------------
CASH FLOWS
Operating activities:
Cash from income, interest and taxation 234,171 100,959
Net increase in investments and
operating assets (304,492) (92,573)
Net change in operating liabilities 156,746 68,944
86,425 77,330
Investing activities (27,517) (21,319)
Financing activities (21,619) (4,093)
Effects of exchange rate
changes (8,490) (1,317)
Net change in cash and cash equivalents -
continuing operations 28,799 50,601
Cash and cash equivalents, beginning of period 338,349 308,109
Cash and cash equivalents, end of period 367,148 358,710
---------------------------------------------------- ------------ --------------
STATEMENT OF INCOME BY SEGMENT
Amounts expressed in US $000 Nine months to September 30, 2018
----------------------------------------------------------------------
(unaudited) Sagicor Sagicor Sagicor Head Inter-segment Total
Life Jamaica Life Office eliminations
USA and other
-------- --------- -------- ----------- -------------- ----------
Total revenue 318,332 437,684 278,259 85,338 (50,909) 1,068,704
Total benefits and expenses 284,353 345,465 263,449 73,296 13,776 980,339
INCOME BEFORE TAXES 33,979 92,219 14,810 12,042 (64,685) 88,365
Income taxes (7,584) (21,297) (3,111) (797) 198 (32,591)
NET INCOME FROM CONTINUING
OPERATIONS 26,395 70,922 11,699 11,245 (64,487) 55,774
-------- --------- -------- ----------- -------------- ----------
Net income / (loss) attributable
to shareholders from continuing
operations 34,117 34,833 11,699 (12,925) (39,183) 28,541
-------- --------- -------- ----------- -------------- ----------
Total Comprehensive income
/ (loss) attributable to shareholders
from continuing operations 29,990 8,564 2,745 (13,640) (37,694) (10,035)
-------- --------- -------- ----------- -------------- ----------
RESTATED
Nine months to September 30, 2017
----------------------------------------------------------------------
Sagicor Sagicor Sagicor Head Inter-segment Total
Life Jamaica Life Office eliminations
USA and other
-------- --------- -------- ----------- -------------- ----------
NET INCOME FROM CONTINUING
OPERATIONS 49,013 71,049 8,531 20,901 (71,889) 77,605
-------- --------- -------- ----------- -------------- ----------
Net income / (loss) attributable
to shareholders from continuing
operations 50,608 34,898 8,531 (861) (46,640) 46,536
-------- --------- -------- ----------- -------------- ----------
Total Comprehensive income
/ (loss) attributable to shareholders
from continuing operations 53,415 40,456 14,420 (575) (45,803) 61,913
----------------------------------------- -------- --------- -------- ----------- -------------- ----------
STATEMENT OF FINANCIAL POSITION BY SEGMENT
Amounts expressed in September 30, 2018
US $000
----------------------------------------------------------------------------
(unaudited) Sagicor Sagicor Sagicor Head Office Inter-segment Total
Life Jamaica Life USA and other eliminations
---------------------- ---------- ---------- ---------- ------------ -------------- ----------
Total assets 1,934,241 2,782,751 2,184,012 336,244 (415,854) 6,821,394
Total liabilities 1,407,071 2,219,142 1,942,252 772,930 (415,854) 5,925,541
------------ -------------- ----------
Net assets 527,170 563,609 241,760 (436,686) - 895,853
---------- ---------- ---------- ------------ -------------- ----------
RESTATED
September 30, 2017
----------------------------------------------------------------------------
Sagicor Sagicor Sagicor Head Office Inter-segment Total
Life Jamaica Life USA and other eliminations
---------- ---------- ---------- ------------ -------------- ----------
Net assets 545,701 514,317 231,507 (402,890) - 888,635
----------------------- ---------- ---------- ---------- ------------ -------------- ----------
PRODUCTS AND SERVICES
Total external revenues relating to the Group's products and services
are summarised as follows:
Amounts expressed in US Nine months to
$000
September 30
2018 2017
(unaudited) (unaudited)
------------- -------------
Life, health and annuity insurance contracts issued
to individuals 674,587 493,801
Life, health and annuity insurance and pension
administration contracts issued to groups 210,171 243,752
Property and casualty insurance 34,693 30,492
Banking, investment management and other financial
services 127,162 121,495
Other revenues 22,091 21,389
1,068,704 910,929
------------- -------------
NOTES TO THE FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
These financial statements have been prepared in accordance with the accounting policies set out in note 2 of the December 31, 2017 audited financial statements, except for the adoption of IFRS 15 - 'Revenue from Contracts with Customers' and IFRS 9 - 'Financial Instruments', which replaces the provisions of IAS 39 - 'Financial Instruments: Recognition and Measurement'. These standards became effective from January 1, 2018.
IFRS 9 replaces the guidance in IAS 39, 'Financial instruments: recognition and measurement'. IFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortized cost, fair value through other comprehensive income ("FVOCI") and fair value through profit and loss ("FVPL"). The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. Classification for debt instruments is driven by the entity's business model for managing the financial assets and whether the contractual cash flows represent solely payments of principal and interest ("SPPI"). If a debt instrument is held to collect, it may be carried at amortised cost if it also meets the SPPI requirement. Debt instruments that meet the SPPI requirement that are held in a portfolio where an entity both holds to collect assets' cash flows and sells assets may be classified as FVOCI. Financial assets that do not contain cash flows that are SPPI must be measured at FVPL. Investments in equity instruments are always measured at fair value. However, management can make an irrevocable election to present changes in fair value in other comprehensive income, provided the instrument is not held for trading. If the equity instrument is held for trading, changes in fair value are presented in profit or loss. The impairment requirements apply to financial assets measured at amortised cost and FVOCI, lease receivables and certain loan commitments and financial guarantee contracts. At initial recognition, an allowance is required for expected credit losses ('ECL') resulting from default events that are possible within the next 12 months ('12-month ECL'). In the event of a significant increase in credit risk, allowance is required for ECL resulting from all possible default events over the expected life of the financial instrument ('lifetime ECL'). Financial assets where 12-month ECL is recognised are considered to be 'stage 1'; financial assets which are considered to have experienced a significant increase in credit risk are in 'stage 2'; and financial assets for which there is objective evidence of impairment are considered to be in default or otherwise credit impaired are in 'stage 3'.
2. RESTATEMENTS
Effective January 1, 2018 the Group implemented a policy to harmonise its actuarial reserving practices across operational segments. This is a voluntary change in policy was reflected as a prior period adjustment in accordance with IAS 8. The impact of this change was an increase in opening equity at January 1, 2017 of US $6.2 million.
Net income of the discontinued operaton and assets of the discontinued operation were adjusted by US $8.2 million to reflect the share of income for full year 2017 income attributable to the nine months of 2017.
Actuarial reserves (benefits) for the nine months of 2017 was adjusted by US $1.3 million along with associated taxed of US $0.5 million relating to various actuarial changes attributable to the period. These actuarial changes also impacted opening equity at September 2017 where opening equity was reduced by US $2.1 million.
Actuarial liabilities at September 2017 were increased by US $7.6 million and actuarial liability fair value reserves in comprehensive income, were correspondingly reduced to reflect fair value movements on available for sale assets.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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November 16, 2018 06:11 ET (11:11 GMT)
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