Britam Holdings is back to profitability, lifted by growth in premiums from new business and higher investment income.
The financial services company posted a Sh376.3 million net profit in the six months to June, recovering from a Sh1.63 billion net loss posted in a similar period last year.
Investment income during the period grew to Sh4.9 billion, representing a 35 per cent growth compared to a similar period last year.
Net revenue from the core business of underwriting rose 2.4 percent to Sh11.97 billion.
The insurer said regional general insurance business posted growth in gross earned premiums, with payments outside Kenya accounting for 24 per cent of total premiums.
The Group also realised growth in revenue from both its local and regional businesses.
The regional businesses contributed 24 per cent of the Group’s gross earned premiums which were up 5.7 per cent to Sh14.9 billion.
Earnings were however impacted by a Sh3.78 billion or 25 percent rise in operating expenses, driven by increased claims payments, interest payments, and restructuring costs.
“Growth in operating expenses attributed mainly to one-off item related to the ongoing transformation of the business as the group implements its new transformation strategy,” said Britam.
Claims and policy holders’ benefits and expenses increased by 27.1 per cent to Sh11.7billion as the business took measures to cushion customers from constraints occasioned by Covid-19.
Britam hopes to continue with recovery in the second half of the year.
“The Group remains optimistic of sustaining profitability in 2021 on the back of an improving operating environment and gains from our new transformative strategy. In the short term, we will however continue to pursue prudent cost management initiatives and maintain a stable solvency position,” said Britam’s Group Managing Director, Tavaziva Madzinga.
The Board of Directors did not recommend the payment of an interim dividend for the six-month period to June 2021.
Britam operates in Kenya, Uganda, Rwanda, Tanzania, South Sudan, Mozambique and Malawi.
