Sygnus Credit Investments Limited (“SCI” or the “company”) an entity under the Leading Alternative Investments firm, Sygnus Capital Limited (“Sygnus”), has announced its Dual Currency Cumulative Redeemable Preference Share Offer (the “Preference Share Offer”) of US$20 million and J$800 million, across three (3) classes of Preference Shares.
SCI’s board of directors authorized a three-year share buyback program which will see SCI repurchasing up to US$9.00 million of its ordinary shares. This further reflects SCI’s commitment to shareholders during its initial public offering and as prescribed by the Company’s articles of association.
Sygnus Credit Investments Limited (SCI) has announced that it will be delisting its Jamaican dollar cross-listed shares and its US dollar cross-listed shares on the main market of the Jamaica stock exchange.
NET PROFIT UP 16% TO A RECORD US$2.86 MILLION AS EARNINGS PER SHARE JUMPS 14.3% TO 0.48 US CENTS
(Kingston, Jamaica) Sygnus Credit Investments Limited (“SCI” or the “Company”), the Caribbean leader in private credit investments released its unaudited financial results for the six months ended December 31, 2022 (“6 Month Dec 2022”). SCI reported record net profits and record core revenues for both 6 Month Dec 2022 and the second quarter ended December 2022 (“Q2 Dec 2022”) . These results were driven by the expansion of its private credit portfolio across the Caribbean region, which grew by 54.6% to US$136.07 million. The Company’s Board of Directors will meet to consider a dividend payment on February 21, 2023.
SCI reported record net profit (US$2.86 million up 16.0%), record total investment income (US$4.53 million up 22.7%) and record net investment income (US$2.65 million up 16.2%), for the 6-month December 2022 period. Earnings per share increased to 0.48 US cents compared with 0.42 US cents last year. The performance was aligned with the company’s new thrust of enhancing shareholder value, which was revealed at its recent annual general meeting in January 2023.
Similar to the 6 month results, SCI reported a second quarter record for net profit (US$1.23 million up 28.8%), total investment income (US$2.26 million up 20.7%) and net investment income (US$1.28 million up 10.7%). Earnings per share increased to 0.21 US cents compared with 0.16 US cents for Q2 in 2021.
During the second quarter, the company further increased its diversification by deploying capital into a new industry: a middle-market firm operating in the transportation sector. Excluding the underlying portfolio Acrecent Financial Corporation (“Acrecent” or “AFC”) which it acquired in February 2022, SCI’s private credit portfolio spanned a record thirteen industries across eight territories. Inclusive of the portfolio from Acrecent, SCI was diversified across 22 industries and 12 territories. AFC is not consolidated into SCI.
Phase II of the integration of AFC into SCI remained on-track for completion later this year. In the meantime, the Puerto Rican management team is diligently expanding and scaling the business in collaboration with SCI’s investment manager.
Jason Morris Executive Vice President and Chief Investment Officer at Sygnus Group shared, “The results are a reflection of SCI’s diligent deployment of capital and taking the bold decision to acquire Acrecent Financial Corporation in a spanish speaking US territory in the Caribbean, while the country was still experiencing substantial financial difficulties. Fast forward a year, and Puerto Rico’s economic outlook is substantially brighter for at least the next 5 years given it now has in excess of US$50 billion in financial support from the United States, its “big brother”. Thus, the spanish-speaking leg of the business has the potential to scale substantially over the medium term. On the English and Dutch-speaking leg of the business, we are seeing substantial origination opportunities to deploy capital and help companies grow and expand. The key focus here is to raise substantial pools of capital to fund these opportunities as fast as possible. We will execute this using multiple financing channels from overseas and local sources to diversify our funding mix. This is the path to continue enhancing shareholder value.”
The Company also reiterated its plan to execute a three year buyback program later this year, which will begin once approved for execution by its Board of Directors. The plan is proposing to buy back between US$1 million and US$3 million of its shares per year over the three years. The program was revealed at the Company’s recent annual general meeting in January 2023.
SCI is rated CariBBB- with a stable outlook by Caribbean rating agency CariCRIS on the regional rating scale. The company carries a rating of jmBBB+ with a stable outlook on the Jamaican rating scale. The Company’s credit rating was upgraded one notch in September 2023.
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With over US$170 million in funded deals on its book, Sygnus Credit Investment Limited is looking to nearly double the portfolio to US$300 million over the next three years.Read more: SCI wants to double deals in three years
The private provider of credit financing solutions is already running well ahead of target on deals struck – having initially set its goal at US$100 million by 2023. It hit that marker towards the end of 2021.
Key to the new goal of adding US$130 million more to its pile of deals is the ongoing scaling up of its Puerto Rican subsidiary, Acrecent, Sygnus Group Executive Vice-President and Chief Investment Officer Jason Morris said this week at the Sygnus Credit’s annual general meeting. Sygnus Credit is managed by Sygnus Capital.
Sygnus owns 93.66 per cent of Acrecent Financial Corporation, which was acquired for US$23.3 million. Since its purchase, Acrecent’s fixed assets and workforce have been integrated into the operations of Sygnus Credit, which was completed in July 2022, with other elements of the amalgamation set to be finalised in a few months, Morris said.
Sygnus will next seek to expand Acrecent’s footprint in Latin American, in order to tap into a US$100-billion market.
Morris told the Financial Gleaner that US$70 million of the deals currently on the books relates to business done by Acrecent.
He also disclosed that Sygnus has more than US$100 million of prospective deals lined up, referred to as a ‘deal pipeline’, across the English and Dutch Caribbean, and is looking to finance them through quasi-debt or other fundraising.
Morris did not rule out the possibility of a rights issue for Sygnus Credit Investments, which has been listed on the Jamaica Stock Exchange since June 2018, and had its biggest capital raise by way of an additional public offering in December 2021 that scored nearly $4 billion.
Regarding revenue generation, Morris says SCI will be introducing new income streams, which would potentially include acting as a sponsor of new private credit solutions.
“What we can do is to syndicate some of these pipeline deals by bringing in other willing partners, rather than do the deal ourselves. Then we could collect a fee, rather than rely solely on net interest income,” he said.
The company earned annual revenue of US$8.25 million last year, and wants to go beyond US$12.5 million in this fiscal period ending June 2023.
“This is not to say that the target is US$12.5 million; rather, this should be seen as a minimum, so if we get to US$15 million, or even US$18 million, we would be okay with that,” Morris said.
So far, the company’s first-quarter revenue of $2.27 million, when annualised, amounts to US$9 million, which puts Sygnus behind the eight ball on its revenue goal so far.
Profit for the period July-September 2022 improved by eight per cent to US$1.63 million.
Caribbean Information and Credit Rating Services Limited (CariCRIS) has upgraded the assigned Corporate Credit Ratings to Sygnus Credit Investments Limited (SCI or the Company) by 1-notch to CariBBB- (Foreign Currency (FC) and Local Currency (LC)) on the regional rating scale and jmBBB+ on the Jamaica national scale (FC and LC).
Sygnus Credit Investments Limited, a Caribbean leader in alternative investments and pioneers in private credit announced at its recently held Annual General Meeting (“AGM”) on January 26, 2022, that the company anticipated receiving regulatory approval for the acquisition of Acrecent Financial Corporation, a private credit company formed in 2003 in Puerto Rico within the next 30 – 60 days.