Ashford W. Meikle, Staff Reporter
President of Life of Jamaica (LoJ), Richard Byles, in a contemplative mood at LoJ's AGM on Wednesday. Beside him, partially hidden, is board member, Dodridge D. Miller. - RUDOLPH BROWN/CHIEF PHOTOGRAPHER
CHAIRMAN OF Life of Jamaica, J. Arthur Bethell, says that the insurance giant expects to have a good second quarter once the numbers are finally in. "We have seen the June numbers and they are going to be released shortly ... I can just make a general statement and say that the results at the end of June are most encouraging."
He was speaking at LoJ's 34th annual general meeting, which was held on Wednesday at its head offices in New Kingston. But, notwithstanding his optimism, Mr. Bethell remained guarded in his comments, citing regulatory restrictions which prevented him from revealing such information before notifying the Financial Services Commission (FSC) and the Jamaica Stock Exchange (JSE).
The chairman's comments was in direct response to a shareholder, Nicola Burrough, who complained that the company had been tardy in updating shareholders about its financial position. "I know you are required to file [the results] with the Stock Exchange within a certain time [but] it would have been good if we had an update on the financial position as we have a vested interest in the company. Sure we can get the information from the [JSE] but it would have been good to have it here."
Ms. Burrough took LoJ's management to task for its scheduling of the AGM, seven months after the end of its financial year (December 31). "Mr. Chairman, I would like to bring your attention to the fact that there are other companies who are having their AGMs a lot earlier than six months after the end of the financial year," she said.
Mr. Bethell highlighted the company's achievements during the year:
An 18 per cent increase in net profit after taxes, which climbed to $1.43 billion, or $220 million more than what the company posted in 2003.
Settled annualised premium income (API) increased by 33 per cent, to $825 million. According to Mr. Bethell, "new API in the Employee Benefits area was ... $710 million compared to $385 million in 2003."
Overall, total new annualised premium was $1.53 billion
A twenty six per cent growth in its asset base, which now stands at $20.6 billion.
A twenty nine per cent jump in total assets under management, which went up to $47 billion.
Stockholders equity increased to $6.4 billion, up from $3.8 billion at the end of 2003.
An almost two hundred per cent increase in the company's share price which leaped from $3.90 in December 2003 to $11.30 in December 2004. Corollary to this, the company's market capitalisation up to December 31, 2004 was $28.7 billion. As a result, LoJ now has the sixth largest market capitalisation on the Jamaica Stock Exchange.
The chairman noted, "At the end of 2004, LoJ's minimum continuing capital and surplus requirement (MCCSR) ... was 293.3 per cent up from 215.9 per cent." This is well ahead of the minimum requirements of the Insurance requirements."
Responding to questions from the floor, president and CEO of LoJ, Richard Byles, said that the company has started construction of the residential development off Hope Road on the four acres of land that it bought from Jamaica Broilers last year for some $115 million. He said, "The residential [construction] has just begun ... we expect that to be complete at about the end of the first quarter next year, going into the second quarter." Mr. Byles said that "the commercial [construction] will start ... towards the end of the third quarter - we expect that to run towards the end of next year."
The total project - a mix of small commercial offices and some sixty studio, one and three bedroom apartments - is expected to cost some $1billion and will comprise over 410,000 square feet of construction. According to Mr. Byles, "in a low interest rate environment investment managers must find creative ways of generating attractive returns." He emphasised that, unlike its previous foray into the real estate market, LoJ was now a developer, rather than holding properties.
Commenting on the merger with First Life. The executive reflected that, "The merger of the First Life and Life of Jamaica business has occurred as planned, perhaps even better than planned. We run the most efficient employee benefits business in Jamaica ... because we have been so successful with that merger."
