Mayberry reports dramatic fall in profits
Mayberry Invest-ments Limited experienced a dip in quarterly earnings, even as it made one of its largest gains in trading.
The company posted $1.7 million net profit for its March first quarter, which was 98 per cent lower than the $93.6 million earned a year earlier. At the same time, its total comprehensive income for the quarter was propelled to $561 million, up 80 per cent compared to the $289.3 million reported a year earlier.
Mayberry is known for holding a vast equity portfolio and also in its capacity as broker. The boutique firm has been the go-to broker for the majority of listings on the junior stock market.
"The net profit does not include realised equity gains of $224.97 million which was recorded in comprehensive income as mandated by IFRS 9, which we early adopted," said Mayberry about the new accounting standards which come into effect in 2018 but were adopted earlier, in a statement accompanying its first quarter financial report.
Under IFRS 9, assets are measured at fair value and the gains and losses from those assets are either recognised entirely in profit or loss, or recognised in other comprehensive income.
Mayberry argued that its performance "must" be viewed within the context of the performance of the global bond market and the local equities market for the first quarter of 2017.
During the quarter, Mayberry experienced mixed revenue performance as it continued to focus on maintaining a diversified revenue stream while minimising risks. There were increases recorded in fees and commission income and unrealised gains on investment valuation, tempered primarily by reductions in net trading gains and net interest income.
The decrease in net interest income resulted from a reduction in the size of the fixed-income portfolio, while the company grew its equities portfolio.
"Local equities delivered robust gains in the first quarter amid an upswing as we continue to record growth in the local economy. Emerging market equities were particularly strong, while international bond markets recorded a mixed performance," added Mayberry.