PanJam Investment Limited boasts a long track record of consistent and growing profits based on a diversified portfolio of investments.
2017 Financial Highlights
Net profit attributable to stockholders of $4,131 million (2016: $4,050 million)
Return on opening equity of 16% (2016: 19%)
Earnings per stock unit of $3.93 (2016: $3.86)
Dividends per stock unit of $0.85 (2016: $0.65 plus a special dividend of $0.20)
Book value per stock unit of $29.02 at year-end (December 31, 2016: $24.43)
Net profit attributable to stockholders for the year ended 31 December 2017 amounted to $4,131 million, (2016: $4,050 million), an increase of 2%, while earnings per stock unit were $3.93 (2016: $3.86).
Property income increased 29% to $1,787 million (2016: $1,382 million), reflecting increased rental income and property revaluation gains of $1,302 million and $485 million (2016: $1,221 million and $162 million) respectively. The latter figure includes gains on the commercial component of the former Oceana building, which was fully renovated. Our property segment continues to contribute meaningfully to the group, posting $608 million (2016: $246 million) of profit before tax.
Investment income of $423 million improved during the year (2016: $239 million). Fair value and realized gains increased to $274 million and $59 million respectively (2016: $155 million and $8 million) while impairment charges fell to $7 million (2016: 161 million). These offset foreign exchange losses of $41 million (2016: gains of $104 million). Our investment management segment, which includes our share of results of associated companies, posted increased pre-tax profit of $3,432 million (2016: $3,308 million).
Total operating expenses for the year amounted to $1,475 million (2016: $1,311 million), an increase of 13%. Direct costs of property management increased 9% to $626 million (2016: $573 million). Staff costs increased by $115 million, influenced by higher bonus accruals.
Finance costs increased 14% to $600 million (2016: $527 million), resulting from higher average debt balances, partially offset by lower interest rates.
Total comprehensive income was $5,968 million (2016: $5,480 million) driven by increased share of other comprehensive income of associated companies of $1,813 million (2016: $1,183 million). These arose principally from Sagicor Group Jamaica Limited (Sagicor).
Our 31.5% stake in Sagicor continues to generate the majority of our income from associated companies. We also continue to hold a 20% interest in Chukka Caribbean Adventures Limited (“Chukka”), an adventure tourism company, and a 32% interest in Caribe Hospitality Jamaica Limited (“Caribe”), developers of the Marriott Courtyard hotel in New Kingston. Through our wholly owned subsidiary PJ-AL Corp Limited, we hold a 20% interest in the Aloft Miami Airport hotel, which commenced operations during the year.
At the end of 2017, we added to our previous 50% interest in Kingchurch Property Holdings Limited, redeveloper of the Oceana property in downtown Kingston, by purchasing Downing Street (Caribbean Place) Limited, through which our former partners held their 50% stake. As a result, we are now sole owners of the project.
During 2017, we increased to 33.3% our previous 25% interest in New Castle Company Limited (“New Castle”), owners of the Walkerswood and Busha Browne brands. In 2016 we had disposed of our holdings in Mavis Bank Coffee Factory Limited and Hardware & Lumber Limited, resulting in realised gains of $851 million during that year.
Our share of results of associated and joint venture companies increased by $237 million (6%) to $3,933 million (2016: $3,696 million). Of this amount, $3,773 million (2016 - $3,517 million) was generated by Sagicor. Sagicor’s net profit attributable to shareholders was $12,070 million, an increase of 7% over the prior year, representing a 19% return on average equity. Sagicor’s results were driven by strong business growth across all lines, significant capital gains on sale of securities, favourable benefits experience and revaluation of certain real estate assets.
Chukka, Newcastle, Caribe and PJ-AL Corp all performed satisfactorily during the year.
Stockholders’ equity increased to $30.5 billion (2016: $25.7 billion) at December 31, 2017, which equates to a book value per share at year-end of $29.02 (2016: $24.43), an increase of 19%. Total assets at December 31, 2017 amounted to $39.4 billion (2016: $32.4 billion).