Sagicor X Fund braces for COVID-19 impact
Sagicor Real Estate X Fund Limited (Sagicor X Fund) is hoping for a bounce-back in resort fortunes in the future.
The company, in comments attached to financial statements on the Jamaica Stock Exchange, said the coronavirus (COVID-19) pandemic has negatively impacted hospitality, airlines and other related sectors.
Directors said: “Our local hotel operation closed in March 2020, while our partner, Playa Hotels & Resorts N. V. has also closed some of its operations both locally and overseas. DoubleTree remains opened but is experiencing some cancellations.
“This virus is a global crisis and we continue to closely monitor the situation. We remain hopeful that our business activities will quickly rebound in the latter part of the year,” the directors stated.
In its review of the 2019 performance, Sagicor X Fund disclosed net loss attributable to stockholders of $38.31 million compared to a net profit of $154.35 million reported for prior year.
In mid-year 2018, Playa Hotels and Resort N.V. acquired the Hilton Rose Hall Resort and Spa, three of the Jewel hotels, part of the Jewel Grande as well as lands that were owned by the Sigma Real Estate Portfolio.
Sagicor secured shares in Playa and cash from the deal.
Sagicor X Fund retained units in Sagicor Sigma Real Estate Fund which is invested primarily in Jamaican non-hotel commercial real estate; units in the Jewel Grande, formerly known as Palmyra and some Playa shares.
Sagicor X Fund, in its year-end report, said that hotels performed better when directly owned compared to the investment in Playa.
In relation to the 2019 results, other factors reported as affecting losses include 2018’s one-time gain of $367 million stemming from the sale of the Jewel hotels.
Finally, it was noted, the current year numbers include a tax charge of $200 million on dividends repatriated from DoubleTree by Hilton (DoubleTree) to its immediate parent, X Fund Properties Limited.
The group also cited unrealised capital gains from revaluation of the Jewel Grande Montego Bay (JGM) property were much higher in 2019.
Group total revenue for the full year was $6.30 billion, down 28 per cent from the $8.81 billion recorded for 2018.
Discontinued operations contributed revenues of $2.72 billion and the gain on the sale of the hotels.
Jamziv, which holds the Playa shares, reported share of loss from an associate of $98.66 million. As at December 31, 2019, the group had cash and cash equivalents of $1.76 billion, up from the amount of $1.48 billion as at December 31, 2018.