Britam Registers Before Tax Profit of 1.4 Billion Shillings in Half-Year Results

Britam Holdings Plc has registered a before-tax profit of 1.4 billion shillings in the first half of 2018, a 7 percent growth from 1.3 billion shillings in June 2017.

The growth was realized despite the backdrop of an 11 percent increase on gross earned premium and fund management fees to 13.0 billion shillings from 11.7 billion shillings in June 2017, and 15 percent growth in total income to 16.8 billion shillings from 14.7 billion shillings during the same period the previous year.

A strong performance of investments in equities in June 2018 compared to June 2017 also boosted the profits.

According to Dr. Benson Wairegi, Britam’s Managing Director, the Group’s asset base has increased by 14 percent to 112 billion shillings from 99 billion shillings in December 2017, while shareholders’ funds have increased by 27 percent on the back of a strong performance and issuance of new shares to AfricInvest SPV III during the period.

Following the successful acquisition of 360,888,281 million new ordinary shares amounting to a 14.3 percent stake in Britam, AfricInvest SPV III – a Pan African focused Private Equity fund – was officially admitted as a shareholder of the diversified financial services company this year.

AfricInvest is a Special Purpose Vehicle (SPV) formed by a consortium of global investors from the Federal Republic of Germany, Netherlands, and France. It is currently managing about One billion dollars in 14 private equity funds.

Britam’s deal with AfricInvest came shortly after the release of 3.6 billion shillings by International Finance Corporation (IFC) to fund strategic projects in the company.

The Group will benefit from the two global investors’ world-class management and technical support while providing senior management access to strategic, financial and investment advice and support in the areas of social impact, environmental standards, and corporate governance.

Revenue from the insurance business increased by 11 percent to 10.8 billion shillings during the period under review compared to 9.7 billion shillings in June 2017.

The net insurance revenue contribution from the Group’s international business stood at 1.5 billion shillings compared to 1.2 billion shillings last year. This accounted for 14 percent of the total net insurance business revenue.

Of the total income, the international businesses made up 11 percent and 7 percent of the company’s total assets.

Britam’s investment in financial assets realized fair value gains totaling to 2.4 billion shillings compared to 2.1 billion shillings in June 2017. The dividends and interest also rose to 3.3 billion shillings from 2.5 billion shillings the previous year.

Having concluded “Go for Gold” – the first phase of its strategic plan – Britam is now in its second phase of the strategic plan dubbed the Disruptive Innovation. The phase focuses on leveraging on project Jawabu platform, the IT-enabled business transformation project to further transform its customer value proposition by delighting and enhancing customer experience through big data and business intelligence alongside workflow efficiencies.

Britam Group also announced that its Board of Directors had resolved on an early redemption for the six billion-shilling Medium Term Note issued in June 2014.

According to Dr. Wairegi, the early redemption of the notes is subject to the consent of Noteholders and the timelines for payment will be announced once this consent is obtained.

Britam used proceeds from the Corporate Bond, which was oversubscribed by 147.7 percent to fund its regional expansion into seven African Countries, and other strategic projects. The Group Asset base has grown from 72 billion shillings to 112 billion shillings, a compounded growth of 12 percent since the bond.