UNAUDITED GROUP FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2019
November 13, 2019
Highlights for the nine (9) months to September 30, 2019
Group EBIT increased from $9.7 million to $105.3 million YOY
Net Operating Income rose YOY by 37% to $70.1 million.
Funds from Operations (FFO) rose YOY by 98% to $42.4 million.
Group rental income up 10% YOY to $168.1 million
Operating expenses declined YOY by 3% to $98.0 million.
We are pleased to present the unaudited consolidated financial statements for the nine months ended
September 30, 2019.
OVERVIEW
Our strategy over the last year of reducing our holdings in condominium units in South Florida and focus
more on higher income yielding properties in Jamaica and the Cayman Islands continues to yield positive
results. The sale of these condos have facilitated the year on year reduction in operating expenses as well
as a reduction in our debt stock since the start of the year. Despite the continued weakness in the South
Florida condo market, the Group maintains 95% occupancy in the condo units owned in that market.
The results for the nine month period to September 30, 2019 also benefitted from fair value gains on
some of our properties as well as higher property management income on the properties we manage.
INCOME STATEMENT
The Group posted a 10.3% increase in
rental income
for the nine months ended September 30, 2019 to
$168.1 million from $152.4 million for the same period in 2018. Rental income for the third quarter to
September 30, 2019, improved by 23.3% to $55.2 million up from $44.8 million in 2018. The
improvement in rental revenue is attributed to the net addition to the property portfolio following the
acquisition of the New Kingston property in October 2018.
Group operating expenses
for the third
quarter remained relatively flat, decreasing by a mere 0.4% from $32.1 million for the three months ended
September 30, 2018 to $31.9 million for the same period this year. For the nine months period, the
decrease in operating expenses was 3.3% to $98.0 million from $101.3 million the prior year. The
reduction in operating expenses arose from lower year on year direct property expenses, such as HOA
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UNAUDITED GROUP FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2019
dues, property taxes and insurance costs attendant on the sale of the Florida condos.
Operating results
posted an 83.2% increase with
results of operating activities before gains
moving from $12.7 million
in 2018 to $23.3 million in 2019 for the third quarter. The increase for the first nine months of the year
was 37.3%, moving from $51.1 million in 2018 to $70.1 million in 2019.
With the disposal of condos during the 2018 review period, the Group recorded a loss before net finance
charges of $14.5 million for the quarter compared with a
profit before net finance charge
of $44.0
million for the third quarter of 2019. For the first nine months of 2019, this line item amounted to $105.3
million compared to $9.7 million in 2018. The year to date figure in 2018 includes a fair value loss on
investment properties of $10.7 million, as well as the loss on disposal of investment property totalling
$34.5 million. By comparison, for the year to date in 2019, the Group recorded fair value gains on
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