Insurance behemoth Sagicor Group Jamaica is celebrating a big third-quarter profit rally which has tempered two previous quarters of sizeable profit declines linked to the COVID-19 economic fallout, which threatens the financial conglomerate’s 20-year unbroken streak of annual profit growth.

Core business improvements and lower loan provisioning at its commercial banking arm in the quarter, are credited for the 138 per cent profit surge over the June quarter and a 34 per cent gain over last year’s September numbers.

Still, Sagicor Group continues to experience significant negative financial headwinds from the underperformance of its 15 per cent stake in big hotel chain Playa Hotels and Resorts, which accounts for the bulk of a $2.8-billion write-down during the September reporting period in its X Fund investments, where a portion of the Playa shares are held. Overall, the group’s hotel-related investments and earnings are challenged.

“The year 2020 is a one-in-a-thousand negative years, which nobody could have anticipated, that is particularly brutal on financial services companies,” says Sagicor Group President and CEO Christopher Zacca, who is, however, buoyed by the latest results.

“The third quarter has brought us back to comparable results to pre-COVID 2019. It’s a credit to the team and we are very proud of what they have done,” he told the Financial Gleaner on Wednesday after the release of the company’s results.

http://jamaica-gleaner.com/article/business/20201113/hotel-losses-haunt-sagicor-profit-rally