Credit Corporation (Fiji) Limited

"2015 proved to be a very successful year for Credit Corporation (Fiji) Limited with the company continuing to improve on its bottom line performance on the back of a stable Fiji economy."

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Credit Corporation (Fiji) Limited

  Peter Dixon
Managing Director

2015 proved to be a very successful year for Credit Corporation (Fiji) Limited with the company continuing to improve on its bottom line performance on the back of a stable Fiji economy. The company recorded an operating profit before tax of F$8.92 million (K11.73 million) for the year, 13.6% up on the prior year’s result. A record net after tax profit of F$7.12 million (K9.36 million) was recorded for the year, a 10.7% improvement over 2014’s result and above expectations.

Despite increased competition through the entry of two new licensed credit institutions, the company’s lending volumes for the year exceeded F$60 million (K84.59 million) for the first time in its history. A major contributing factor to the increase in sales volumes was a focused effort from our sales team, competitive product offerings and responsive customer service across the business.

The company remains in a strong financial position, with total assets of F$115.6 million (K162.98 million) and shareholder’s funds of F$35.18 million (K49.59 million) as at 31 December 2015. Capital Adequacy ratio stood at 32.6% at year end, well in excess of the Reserve Bank of Fiji’s prudential requirement, underlining the financial health of the company.

Despite below average global growth in 2015, data for the Fijian economy indicates that overall economic activity remained quite strong in 2015 and the economy on track to achieve 4% growth for the year. Consumption activity remained buoyant as evidenced by growth in consumer lending and strong consumer spending. Investment activity was solidly driven by strong growth in construction activity.

Sectoral performances were mixed in 2015 with increased activity in tourism, gold, cement and electricity production while sugar, timber and fishing production declined. Certain areas of primary production in Fiji were negatively affected by prolonged drought conditions existing through the year.

 

The Fiji economy was expected to grow by 3.5% in 2016, however the recent devastation of many parts of Fiji by Cyclone Winston is expected to put a major dampener on growth this year as Fiji recovers. Cyclone Winston’s impact on agriculture alone is expected to exceed F$200 million (K281.97 million), however luckily the main core of tourist industry operations has been spared major damage.

The company’s finance book is well provisioned and provisions sufficient to cushion against potential losses which may arise from major shocks such as Cyclone Winston. Understandably there has been a major slowdown in business immediately post Cyclone Winston, however hopefully this will prove to be a short term situation and business will return to normal by mid 2016.

Peter Dixon
Managing Director