From left, Duncan-Scott and Duncan
WHILE THE significant hike (roughly 100 per cent) in interest rates earlier this year rocked the local financial market, the management of the Jamaica Money Market Brokers remained calm and confident that the diversification strategy they embarked on in 2000 would buffer any market-driven fluctuations in the company's profits.
In fact, JMMB's share of profits at Caribbean Money Market Brokers (CMMB) in Trinidad soared to $308.4 million for the six months ended August 31, 2003 versus $81.7 million in the same period a year ago. This strategy will continue with JMMB's expansion into the Barbados market within the next few months.
Further, JMMB maintains a healthy investment portfolio of Government of Jamaica tax-free bonds allowing the company's clients and shareholders to realise the benefits associated with these instruments. In addition to the strong increase in profits from its associated companies, JMMB's profits from the local financial markets have shown strong recovery in the August 2003 quarter (second quarter) versus the May 2003 quarter (first quarter). Operating profits recovered more than four-fold in the second quarter to $271.3 million from $49.5 million in the first quarter. Management expects that this recovery trend will continue into the third quarter. On the balance sheet, total assets at August 31, 2003 rose 18 per cent to $55.2 billion versus assets of $46.8 billion at August 31, 2002, continuing the robust growth trend. JMMB's cash position remains strong at $1.2 billion at August 31, 2003.
Shareholders equity at August 31, 2003 was $2.7 billion, up 59 per cent from $1.7 billion a year ago.
PROFIT MARGIN
Pre-tax profit margin for the six months ended August 31, 2003 was 83 per cent versus 75 per cent for the similar period a year ago. Managing Director, Donna Duncan-Scott, said: "The profit results of JMMB's regional expansion is strong validation of management's strategy. We expect to continue to take the JMMB model to additional markets in the Caribbean."
Deputy Managing Director, Keith Duncan, commented that "JMMB remains committed to its strategy of diversification of its income stream, expanding into new areas in Jamaica, and deepening its relationship with the clients by providing new products and services in response to their needs. A stable macro environment in which interest rates continue to trend down, would allow JMMB's profits from local operations to continue to outperform."
