Saturday 28 November, 2020

1834 Investments says bond portfolio looking better

Acting General Manager of 1834 Investments Limited, Terry Peyrefitte, says some company asset valuations saw significant declines in late March 2020, due to the coronavirus (COVID-19) pandemic.

Peyrefitte, in comments attached to the company’s financials, said the adverse impact was confined to less than 15 per cent of 1834’s investment portfolio, namely quoted USD equities and bonds.

Nonetheless, recovery is underway, he noted. 

The asset classes declined between five and 24 per cent in value in the January to March 2020 quarter, and have subsequently seen a partial recovery, Peyrefitte outlined.

The company head said he considered it prudent to maintain a conservative investment profile in the near term.

1834 Investments’ ability to withstand COVID-19 related shocks has been high with limited disruption to operations, Peyrefitte said.

“Revenue performance has been stable and cash flow adequate for operational needs.”

“1834 has not experienced losses due to interest or capital default on any of its investments.  Issuer credit risk is considered acceptable at this time, and continues to be monitored,” it was stated.

The company’s fourth-quarter results and audited financials are not yet available.   

But for the nine months ended December 2019, 1834 Investments made a profit of $13 million compared to a loss of $59.56 million in the similar period in 2018.

Operating income for the last reported quarter was $17.44 million compared to $21.87 million in December 2018.

Management said in its recent update on the impact of COVID-19 on its operations that the company is continuing to exhibit stable financial performance.

Peyrefitte said that ahead of the pandemic, 1834 maintained a “conservative financial position of high liquidity, low debt and a low-moderate risk asset profile, which allowed the group to weather the extreme local and international business uncertainty associated with the pandemic, with minimal financial disruption.”

The consequence, he stated, was a moderate impact on investment asset valuations.

1834 Investments will be pursuing expense reduction initiatives and exploring new business opportunities going forward, according to Peyrefitte.

“We continue to monitor external developments for adjustments to our operations where necessary and to remain compliant with public health orders,” he stated.

The company said enforcement of precautionary measures have contributed to zero staff infections/downtime.

“Access to technology has allowed 1834 to operate remotely in part, with limited disruption to its operations,” it was noted.

Delays were however experienced due to the general restrictions on movement within Jamaica and as a result of workflow, connectivity and hours of business adjustments implemented by various partners.

“We believe that we have been fortunate throughout this period of extraordinary uncertainty,” the company noted.

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