May 2007 Financial News

SBTT Releases Half Year Results

May 25, 2007

Results for the Half Year Ended April 30, 2007

Scotiabank Trinidad and Tobago Limited (SBTT) for the Half Year Ended April 30, 2007 reported Earnings Per Share (EPS) of 100.6 cents. This represented a significant increase of 23.28 per cent or 19 cents on the comparable figure in 2006. Additionally, the Group reported another successful quarter as Q207 on Q206, this figure was up 20.45 per cent or 8.20 cents from 40.10 cents in Q206 to 48.30 cents in Q207.

For the period under review, Net Interest Income rose 18.98 per cent or $46.634 million to $292.385 million. Other Income also saw a considerable increase of 19.58 per cent or $16.194 million to close the quarter at $98.921 million. Thus, Net Interest & Other Income amounted to $391.306 million for Q107 and was up $62.828 million or 19.13 per cent on the corresponding figure in 2006.

Non-Interest Expenses increased 13.55 per cent or $19.024 million to end the Half Year at $159.473 million. The major contributor was Salaries and Staff Benefits of $77.542 million, up 15.49 per cent or $10.400 million on the same period in the prior financial year. Premises and Technology was up a substantial 30.02 per cent or $8.485 million to $36.747 and Other Expenses grew 21.84 per cent or $6.345 million to $35.392 million. Conversely, Communications and Marketing Expenses dropped 16.69 per cent or $2.018 million to $10.074 million while Loan Loss Expenses fell from $3.906 million in HY06 to -$0.282 million HY07.

Income Before Taxation for the Half Year stood at $231.833 million, an outstanding increase of 23.30 per cent or $43.804 million. The Effective Tax Rate for the six month period was 23.51 per cent compared to a similar Tax Rate of 23.50 per cent in HY06. As a result, Income After Taxation was $177.323 million, an increase of $33.477 million or 23.27 per cent on the comparable period of the previous financial year. According to the Managing Director, Mr. Richard Young, in addition to the strong earnings over the period, SBTT saw significant improvements in key performance metrics such as revenue growth, customer satisfaction and loyalty, new customer acquisition, productivity ratio and loan loss experience.

The Directors have resolved to pay a second interim dividend of 21 cents per ordinary share (2006 – 15.3 cents) on June 26, 2007 to shareholders on record as at June 5, 2007.

Currently SBTT is trading at a price of $30.00 and at our current forecasted EPS of $2.15 this share is trading at a price to earnings multiple of 13.95 times. Thus, we continue to recommend a HOLD on this share.

Nancy Chen
WISE Equity Research Team