Aggressive sales paying off for Dolla Financial
Published:Wednesday | July 24, 2024 | 12:05 AM
Microfinance company Dolla Financial Group credits its aggressive sales strategy for its impressive performance over the first six months of 2024, which saw its net profit jump by 25 per cent over the first half of 2023.
The Dolla Group, which includes subsidiary Ultra Financier Services for rich clients, registered net profit of $284 million for the first half of 2024, which is up from $227 million in the corresponding period of 2023.
“Our sales team is not used to a culture of sitting in office. They have really done a tremendous job of going out there to identify prospects and providing that tailored service which aligns to the needs of our customers, and has those customers coming back for business time and time again,” said Group CEO Kenroy Kerr.
Speaking at the Mayberry Investor Forum, Kerr said the company’s sales force had been aggressive in forging relationships with their clients.
“We have partnered with just about every taxi association in Jamaica to make sure we are going out there to meet our targets… . We go out there and build our own destiny,” he said.
Trevene McKenzie, Dolla’s chief financial officer, said the company’s sales team had been increased by 35 per cent in the past year and had worked hard to provide tailored solutions to their clients. “We understand what our customers want and give it to them. We know what the taxi driver wants and know what a hairdresser wants,” she said.
Interest income has grown by 26 per cent to $743 million, while net interest income grew by 24 per cent to $622.56 million during the first half of 2024. Operating expenses grew at a slower pace, 15 per cent, during the period.
“We have been very deliberate in managing our expenses. We’re a very lean company,” said McKenzie.
Mayberry controls approximately 20 per cent of Dolla Financial.
Kerr said Ultra Financier registered income of $285 million and profit before tax in the region of $140 million, which represented 45 per cent of the group’s profits.
“I believe the demand on both segments, Dolla Jamaica and Ultra, are outpacing what we can comfortably dispense on a monthly basis,” Kerr said.
In June, Dolla launched its 11th branch in Morant Bay, St Thomas.
Kerr said the largest segments of the company’s loans come from the construction industry, representing 27 per cent of the portfolio, followed by haulage and transportation, representing 25 per cent.
McKenzie added that 83 per cent of the loan portfolio was secured, and that 85 per cent of the loans in Dolla’s portfolio were issued to business entities.
“There is a real push in the economy for entrepreneurship. We see people leaving school and wanting to be entrepreneurs and that has been really beneficial for us,” McKenzie said.
While stating that market conditions have not impacted on the company’s financial performance, the CFO said there were “some effects from Hurricane Beryl which we are currently bracing for and are prepared to manage”.
Meanwhile, Kerr said the process of winding up the Dolla Guyana subsidiary, which now had less than $100 million in loans, was ongoing.
The average duration of Dolla’s loans is about 18 months. And there are about 3,000 active clients.
Kerr said the company’s expected credit losses and non-performing loans as of June were 3.8 per cent and 8.3 per cent, respectively, which are both below the average for companies in the industry.