Keith Collister, Business Writer

Stephen Facey, chief executive officer of Pan Jamaican Investment Trust. - File

Pan Jamaican Investment Trust Limited (PanJam) has recorded net profit growth of 14 per cent to $269 million for the September quarter relative to the matching period a year ago, resulting in a 23 per cent increase in earnings per share of $1.16 versus $1.02 in 2005.

Despite falling interest rates and a competitive environment, the group's income from continuing operations, when adjusted for a one-off gain in other income for the September 2005 quarter, increased by 25 per cent.

Exploiting opportunities

Going forward, PanJam will be focused mainly on property develop-ment and other property-related transactions with an emphasis on capital preservation, Chief Executive Officer, Stephen Facey, suggested in a comment to Wednesday Business.

Facey said the group stands ready to exploit the right opportunities.

PanJam's operations this quarter were driven mainly by growth in investment income of 28 per cent to $55 million (2005: $43 million), and property income up 13 per cent to $180 million (2005: $159 million), as occupancy levels continue to average 95 per cent.

Operating expenses for the quarter increased marginally to $115 million from $110.5 million or by 4.0 per cent, while interest expense decreased with falling interest rates to $11 million from $14.5 million.

The most significant boost to the bottom line was the 51 per cent increase in the share of results of associated companies, which was largely attributable to the 25 per cent stake of Life of Jamaica (LoJ) held by First Jamaica Investments Limited.

Good performances

Market leader LoJ posted strong third quarter results with a 50 per cent growth in net profits to $722 million or earning per share of 16 cents.

The insurance company's 51 per cent holding in Pan Caribbean Financial Services also performed well, growing its net income by 22 per cent to $271 million or earnings per share of $0.50 for the quarter.

PanJam's 20 per cent holding in Hardware & Lumber contributed marginally, reporting an increase in net profits of 41 per cent to $14.2 million in 2005 verses $10.1 million in the review quarter. With cement supplies regularising, it is expected that profits should improve in the coming months and into next year.

PanJam's shareholders equity in the consolidated balance sheet has grown by $763 million since year end. However, the value of its LoJ shares is currently recorded at transaction cost and not market value (PanJam owns approximately four shares of LoJ per PanJam share on a look through basis). Its property holdings are currently valued at about half of new construction costs, suggesting the group has much higher intrinsic value.

With a debt to equity ratio below 12 per cent, and an abundance of cash, the group appears placed to take advantage of future growth prospects.

Email: keithcollister@cwjamaica.com.