Diversified financial services group, Britam Holdings Monday posted a profit before tax Sh 4.2 billion for the full year 2016 compared to a loss before tax of Sh 1.2 billion it recorded a year earlier.
The firm also announced a 581.5million dividend payout to its shareholders following the impressive results – whose main contributor to other comprehensive income in both 2015 and 2016, the group said were losses ensuing from readjustment of strategic investments in equities.
The Group’s asset base soared by 8 per cent to Sh 83.6 billion, up from Sh 77.6 billion in 2015.
Total comprehensive income for the group grew to Sh 784. 7 million, compared to a loss of Sh 3.2 billion in 2015. The main contributor to the difference between the reported profit before tax and the total comprehensive income in 2016 were losses resulting from disposal or revaluation of strategic investments in equities.
The group’s life business registered a sustained growth in 2016, with gross earned premiums growing by 19 per cent to Sh 8.8 billion compared to Sh7.4 billion in 2015.
Ordinary life premiums increased by 20 per cent while pension contribution increased by 94 per cent driven by sales from the existing network of over 3, 800 financial advisors.
Non-life business gross earned premiums declined by 6 per cent from Sh12.2 billion in 2015 to Sh11.5 billion in 2016 as a result of the Group adopting a more stringent credit policy to mitigate the risk of non-collection of premiums and the adoption of claims handling expenses reserves not previously included.
As a result of these changes, the profit arising from this business segment increased to Sh1.0 billion from a loss of Sh 92.6 million in 2015.
Net insurance benefits declined by 53 per cent. To ensure compliance with requirements of the Insurance Act as amended by the Finance Act 2015 and as required by the Insurance Regulatory Authority (IRA), the Group adopted the Gross Premium Valuation (GPV) methodology which is a change from the previously applied Net Premium Valuation (NPV). This change resulted in a reduction in the net insurance benefits and claims by Sh 5.2 billion.
Fund management fees from the Asset Management business grew by 29 per cent to Sh 929.2 million compared to Sh 718.5 million in 2015. The increase is attributable to growth in Assets Under Management (AUM) by 20 per cent to Sh108.9 billion from Sh 90.5 billion in 2015.
Speaking during the release of the group’s full year financial results for 2016, Britam Group Managing Director Benson Wairegi said that the Group had unveiled a new strategy that will help propel the company to the next phase of growth.
Dubbed “Go for Gold”, the new 2016-2020 strategy is anchored on five strategic pillars of enabling transformation, operational excellence, customer service, Innovation, and Profitable growth.
“The new strategy will be a key platform to deliver the organisation’s next wave of growth, to deliver profitable growth to shareholders,” Wairegi said.
In light of the good performance, shareholders will earn Shs 581.5 million in dividends after the board of directors recommended a final payment divided of 30 cents per share.
1,332 total views, 0 views today