Following the pain of 2012’s $8 million loss, Consolidated Finance Company Limited (CFCL) is reporting a $2.1 million profit.
Chairman Chip Sa Gomes, who was reporting on CFCL’s performance for the year ended December 31, 2013, said this was “a significantly improved operating performance driven by strong cost management and much lower loan provisions compared to 2012”. The reported profits were “before tax”.
He also pointed out that that “net interest and other income, however, fell by 19 per cent, reflecting the continued impact of weak economic conditions in the country and resultant effects on vehicle sales and financing”.
“Earnings before tax in 2013 was $2.1 million compared to a loss of $8 million in 2012. General and administrative expenses were down 19 per cent compared to 2012 and loan loss provisioning was at $1.9 million in 2013 compared to $12.8 million in 2012,” the company spokesman said.
“Our asset finance business comprising vehicle leasing and hire purchase remains our core activity. Excellent customer service and a unique product which combines the group’s strengths in insurance through Brydens Insurance, automobile sales through McEnearney Quality Inc. and financing from ourselves, has enabled us to maintain our market share.
“Foreign exchange remains a very important business line but was impacted by declining foreign exchange volumes in the market compared to previous years. Improved active management of the portfolios, both performing and non-performing, led to lower provisions in our commercial lending and this has reduced the drag that this placed on earnings in 2012,” he added.
The chairman said the resources CFCL dedicated to remediating this portfolio was “working effectively to mitigate further risk and look for opportunities to secure gains as we regularise this part of our book”.
“Our balance sheet remains strong with a capital base of $47.4 million as at December 31, 2013 and a capital adequacy ratio of 20 per cent, which is well above the regulatory requirement of eight per cent,” he said. (SC)
