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Higher banking, noninsurance results boost ILC's Q1 profit

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Higher banking, noninsurance results boost ILC's Q1 profit

First-quarter net income at Inversiones La Construcción SA, the investment arm of Chile's construction chamber, rose 7.8% year over year as the company booked a significant improvement in its non-operating results.

ILC, as the company is known, registered a profit of about 35.66 billion Chilean pesos in the three-month period, up from the 33.07 billion pesos earned in the year-ago period.

Non-operating income for the quarter more than doubled to around 18.69 billion pesos from 8.89 billion pesos a year ago, while operating income inched 1.5% higher to 30.52 billion pesos.

The substantially higher non-operating income was partly due to unit Red Salud's divestment in i-Med in January, the company said, adding that this was partially offset by a lower return on AFP Habitat's legal reserves, as well as by the negative effect from foreign exchange fluctuations on individual life insurances.

The company's profit from non-insurance activity went up 57.1% to about 21.52 billion pesos from nearly 13.70 billion pesos a year earlier. However, profit from the company's insurance activity slid 35.8% to 12.47 billion pesos in the three-month period from 19.44 billion pesos a year ago.

ILC's banking activity profit also went up sharply in the quarter, rising 352.7% to 4.02 billion pesos from about 888 million pesos a year earlier. Provisions for loan losses in banking activity declined 34.8% annually to 2.18 billion pesos.

Banking unit Banco Internacional SA contributed 3.95 billion pesos in profits for the quarter, up from 1.11 billion pesos in the prior-year period, with net income from fees and services rising 9.6% to 1.33 billion pesos.

ILC's return on equity hit 18.1% in the first quarter, up 544 basis points year over year.

The company also said it paid a final dividend of 481 pesos per share in May related to its 2017 profits.

As of May 28, US$1 was equivalent to 623.89 Chilean pesos.