Hurricane Beryl and a week-long global outage at MoneyGram International Inc were significant enough to send Lasco Financial Services Limited (LASF) from a net profit of $37.19 million to a net loss of $8.64 million for its second quarter (July to September). ).

The remittance company released its second quarter report on Friday, noting that Hurricane Beryl disrupted its ability to serve customers on Jamaica’s south coast, which had suffered damaged roads and access reduced to electricity. However, the company managed to get through this difficult period and commended its sub-agents who served these parishes.

“As we recovered from the impact of the hurricane, we were further impacted by events that led MoneyGram International to proactively take its systems offline to contain and remediate unauthorized activity. There was a complete shutdown of transactions for five days, which had a significant impact on our revenue from remittance, cambio and card services. Since the restoration of services, transactions have gradually improved but have not normalized,” Jacinth Hall-Tracey, managing director of Lasco Financial, said in the quarterly report.

Remittances account for 43 percent of Lasco Financial’s revenue, which totaled $2.20 billion for the fiscal year (FY) of March 2024. Another 34 percent of the company’s revenue comes from its cambio business and 14 percent of its microcredit subsidiary.

These disruptions from the hurricane and MoneyGram are responsible for the 5 percent drop in revenue, to $546.28 million. Despite a limited increase in administrative expenses, Lasco Financials’ sales and promotion expenses increased 6 percent to $204.71 million as the company spent more to promote the recently launched MoneyGram Direct to Card service. The combination of these events resulted in a 61 percent drop in operating profit, from $71.01 million to $27.16 million. A slight increase in finance costs of $20.76 million and a relatively unchanged tax expense of $15.05 million were responsible for the quarter’s loss.

Provisional data from the Bank of Jamaica for August shows that remittances increased by 3.6 percent to $299.60 million, an improvement from July when there was a 4.7 percent drop in monthly inflows, from $302.80 million to $288.70 million. Remittances from January to August decreased 0.64 percent to $1.94 billion.

For the full six months, Lasco Financial’s revenue fell 6 percent to $1.08 billion, with operating profit down 43 percent to $79.50 million. Even with lower financial costs and tax charges, net profit declined 84 percent, from $56 million to $9.15 million.

Total assets decreased 7% to $4.15 billion, with the company’s balance of loans and other receivables at $1.53 billion, while its cash balances stood at $1.53 billion. 08 billion, with net cash of $845.81 million after taking into account a bank overdraft. Total liabilities decreased 14 percent to $1.87 billion as the company reduced its debts and bank overdraft while shareholders’ equity closed the period at $2.28 billion.

As Lasco looks to turn the ship around, it has closed its underperforming Montego Bay branch, which is expected to result in improved profits for the company in the coming months. This is done in tandem with cost-cutting measures and growth-enhancing services.

Lasco closed Tuesday at $1.76, leaving the stock down eight percent with a market cap of $2.25 billion. Mayberry Jamaican Equities purchased an additional 2,466,864 shares since March to bring its holdings to 267,179,109 shares with a 20.8697 percent stake. The Mayberry Managed Clients account sold 174,539 shares to reduce its stake to 8,957,963 shares while JN Fund Managers Limited for JN Pooled Pension Local Equity Fund became the sixth largest shareholder with 12,286,087 shares. Human resources manager Nordel Leach-Murphy now owns 1,171,112 shares after not owning any at the start of the new financial year.