Andrew Green, Acting Financial Editor
BERRY
MAYBERRY INVESTMENTS raised $1.49 billion of new capital last year, boosting its capital base to $2.5 billion, but its profitability suffered a major decline.
"I am very disappointed," chairman Christopher Berry told The Gleaner yesterday when asked about the performance. But he added, "I am optimistic for the future."
The company earned a net profit of $88.1 million for the year ended December 31, 2005, compared with $378.4 million the year before. That amounted to 8 cents per share for 2005.
Established in 1985, Mayberry is a financial advisory firm. The company is also a primary dealer in government securities and operators of a cambio.
MAJOR PROBLEM
Last year was difficult for many Jamaicans but the major problem affecting Mayberry came about as a result of the company's substantial stock portfolio, Mr. Berry said. Overall weakness in the stock market caused a devaluation of this stock portfolio calculated at $377 million last year.
Net interest income and other operating revenues stood at $487 million compared to $800 million for 2004, a decrease of $313 million or 39 per cent. this was primarily driven by the stock portfolio decline. "We still think the companies we hold have good prospects for growth in the medium to long term term," the chairman stated. "We have a lot of confidence in their prospects to make profits."
Despite the negative portfolio performance during 2005 the company was able to grow its net interest income by 9 per cent. This was achieved even though interest rate spreads narrowed in the USA and Jamaica, the two major markets in which Mayberry operates.
STAFF COSTS
Operating expenses stood at $465 million compared to $403 million for the year 2004. This was due to an increase in staff costs which was driven by the increase in staff complement to 102 from 77 employees the year before along with foreign exchange losses. The foreign exchange losses were greater than programmed and were driven primarily by the movement of the Euro against the US dollar.
The company was also able to increase its retail investor base and its assets under management as capital management funds increased from $1.99 billion to $2.73 billion, he stated. Its managed equities portfolio increased by about $271 million.
"This year (2006) we have a much bigger mutual fund footprint," Mr. Berry said. "We will have over 20 mutual funds offering within a month. We offer First Global funds now."
Mr. Berry said he was optimistic about the prospects for 2006 as the economy is growing and investment companies should improve their performance in a buoyant economy.
