The Sagi­cor Group record­ed a 70.5 per cent in­crease in net in­come and a 72.6 per cent in­crease in earn­ings per share in its op­er­a­tions in the Caribbean and Unit­ed States for nine months end­ed Sep­tem­ber 30.

The group's lat­est fi­nan­cial re­sults, which were pub­lished yes­ter­day, saw net in­come up to US$38.7 mil­lion from the pre­vi­ous year's US$22.7 mil­lion, along with an in­crease in earn­ings per share from US7.3 cents to US12.6 cents.

To­tal rev­enue in­creased to US$807.9 mil­lion, com­pared to US$751.4 mil­lion for the cor­re­spond­ing pe­ri­od in 2014–an in­crease of 7.5 per cent and net pre­mi­um rev­enue closed at US $488 mil­lion, com­pared to US $457.2 mil­lion, an in­crease of US$30.8 mil­lion.

In his re­port to share­hold­ers on the group's lat­est re­sults, Sagi­cor chair­man Stephen Mc­Na­ma­ra said: "Net in­vest­ment and oth­er in­come was US$319.8 mil­lion, com­pared to US$294.2 mil­lion, an in­crease of US$25.6 mil­lion or 8.7 per cent, and in­cludes the im­pact of the RBC Roy­al Bank's op­er­a­tion in Ja­maica, which was ac­quired on June 27, 2014.

"To­tal ben­e­fits closed at US$417 mil­lion and was be­low the pri­or year amount, US$425.4 mil­lion. Ex­pens­es in­creased to US$313.4 mil­lion, com­pared to US$273.1 mil­lion for the pre­vi­ous year. The in­crease in ex­pens­es in­clud­ed high­er as­set tax­es, and re­flect­ed ex­pens­es in­curred with the in­clu­sion of the op­er­a­tion and in­te­gra­tion of the RBC Roy­al Bank's Ja­maica bank­ing op­er­a­tion for nine months as com­pared to three months for the pri­or pe­ri­od."

Mc­Na­ma­ra said the group in­curred ad­di­tion­al fi­nance costs re­lat­ed to a US$320 mil­lion bond is­sued on Au­gust 11 and ear­ly re­demp­tion of US$150 mil­lion in se­nior notes on Sep­tem­ber 10.

He said the group ex­pe­ri­enced mark-to-mar­ket changes on fi­nan­cial as­sets as­so­ci­at­ed with its in­ter­na­tion­al port­fo­lios.

"These re­sult­ed from volatil­i­ty in glob­al bond prices, re­flect­ing con­cerns over the eco­nom­ic slow­down in Chi­na, and con­cerns over when the Fed­er­al Re­serve will raise in­ter­est rates. A de­cline in the Ja­maica dol­lar re­sult­ed in cur­ren­cy re­trans­la­tion loss­es of US$10.8 mil­lion," he said.

"The dis­con­tin­ued op­er­a­tion rep­re­sents our UK busi­ness, which was sold on De­cem­ber 23, 2013. The terms of the sale re­quired the Sagi­cor Group to re­tain an in­ter­est in the 2011, 2012 and 2013 un­der­writ­ing years of ac­count, sub­ject to a lim­it de­nom­i­nat­ed in pounds ster­ling. The com­pa­ny re­port­ed in its first quar­ter re­sults that man­age­ment had ne­go­ti­at­ed rein­sur­ance to cov­er the resid­ual ex­po­sure at a cost of US$12.6 mil­lion.

"How­ev­er, the un­der­ly­ing agree­ments were not ex­e­cut­ed and the group has there­fore record­ed its ex­po­sure in these fi­nan­cial state­ments un­der the orig­i­nal sale agree­ment. For the nine months end­ed Sep­tem­ber 2015, the dis­con­tin­ued busi­ness ex­pe­ri­enced a loss of US$18.5 mil­lion, re­sult­ing from ad­verse move­ments in claims re­serves. The max­i­mum resid­ual con­tin­gent ex­po­sure un­der the sale agree­ment is ap­prox­i­mate­ly US $5 mil­lion."

The Sagi­cor Group's to­tal as­sets reached US $6.4 bil­lion and share­hold­ers' eq­ui­ty was US $719.9 mil­lion, com­pared to US $726.7 mil­lion. The group's debt was US$466.9 mil­lion.

Mc­Na­ma­ra said the group's board and man­age­ment "will con­tin­ue to care­ful­ly nav­i­gate the eco­nom­ic chal­lenges be­ing faced in some of the coun­tries in which we op­er­ate; along with the emerg­ing volatil­i­ty with­in glob­al in­vest­ment mar­kets. We will con­tin­ue to en­sure de­liv­ery of val­ue to our cus­tomers and com­pet­i­tive re­turns to our in­vestors."