iCreate’s bond issue raises $24 million

Start-up company iCreate Limited has started the year on a high raising J$24 million in a successful bond issue earlier this month.

iCreate Limited’s listing on the Jamaica Stock Exchange

The bond issue, which was arranged by Sagicor Investments Limited, has now provided the company with additional capital to grow its business and pay down liabilities, which stands at $37 million as at December 31, 2019. The bond has semi-annul coupon payments and matures in five years.

iCreate, is a subsidiary of eMedia Interactive Group with its registered office at 72B Hope Road, Kingston 6. Its principal activity is to develop and deliver degree and certificate courses to students in the creative field including advertising, film, animation, graphic design, mobile games, fashion design and more.

iCreate reported strong revenue growth of J$48.3 million, an increase of 51.6 per cent when compared to the corresponding period of 2018, in its just-released unaudited 2019 financial report. This strong revenue growth was attributable to increased physical capacity at the Kingston location and the opening of its Montego Bay branch during the year.

Members of iCreate Limited (ICREATE) and the Regulatory and Market Oversight Division(RMOD) took the time out for a photograph following a JSE’s Rules Orientation Session conducted by the RMOD team .

For the quarter ended December 31, 2019 the company recorded revenue growth of 185 per cent or $4.5 million over the corresponding quarter of 2018. Gross profit for the 12 months ended December 31, 2019,  increased from $20 million to $33.5 million or 67 per cent over prior period. Gross profit margin improved from 63 per cent to 69 per cent when compared to the similar period last year.

Net loss on comprehensive income

Total comprehensive income for the period under review recorded a net loss of $34 million compared to $14.8 million loss recorded in 2018. This was due primarily to lower than expected revenue in the fourth quarter as a result of the timing of a few contracts slated to finalise in the fourth quarter of 2019 which will not materialise until the first quarter of 2020.

The Jamaica Stock Exchange

Additionally, the company performed an assessment of its receivables and increased its credit loss provisions by $8.3 million, which was recorded in the fourth quarter. Overall, increased legal, professional and regulatory fees associated with listing on the Jamaica Stock Exchange, increased expected credit losses relating to receivables and increased depreciation charges arising from investment in training equipment and leasehold improvement at the Kingston and Montego Bay locations, adversely impacted the bottom line.

Notwithstanding the overall performance in 2019, the company’s significant capital investment in training equipment and physical capacity in 2019 has positioned the company for growth in revenue and profitability in the coming years.

Positive outlook

iCreate develops and delivers degree and certificate courses to students in the creative field.

The outlook for iCreate is positive given some bold decisions in 2019, including the move to increase provision for credit losses. With our infrastructure now at 100 per cent completion, the company expect a positive return on investment as it strategically increases market penetration, diversify product offerings, and create key partnerships.

iCreate reports that it continue to enjoy a student satisfaction rating above 80 per cent with the Montego Bay office showing good signs of growth and its expansion into Trinidad and Tobago, which started recording revenues in just one month of launch.

New senior appointment

iCreate also advised that Antoinette Hamilton has been appointed to the position of Chief Financial Officer. She will be responsible for the financial operations of iCreate Limited.

Hamilton is a Chartered Accountant with over 12 years audit and financial expertise in the private sector. She holds a Bachelor of Science Degree in Management Studies (Accounting) from the University of the West Indies, completed the Certified Public Accountant qualifications with the Georgia State Board of Accountancy, USA and currently pursuing a MBA in Banking and Finance at the Mona School of Business and Management. She also serves as a member of the Advisory Board of the Jamaica Business Development Corporation.