Britam Posts Shs 4.6 Billion Pre-Tax Profit In 2019

Diversified financial services group, Britam Holdings has recorded a pre-tax profit of Shs 4.6 billion for the full year 2019 which is a significant improvement compared to a loss of Shs 2.3 billion in the previous year.

 The group’s gross earned premiums recorded a 17 percent growth. The international insurance business contributed 19 percent of the Group’s gross earned premium, thereby boosting profitably to the Group. This is in line with the strategic objective of the international business contributing 20 percent of group insurance revenue.

The Life Assurance business embedded value increased to Shs 16.9 billion, a return of 27 percent, an indication that the life assurance business is writing profitable business that will generate additional value to the shareholders in the future.

The Group results were also supported by improved investment performance arising from significant growth in investment income (dividend and interest income) as a result of increased investments’ in high earning fixed income securities as well as stock market gains.

Announcing the results, the Group Managing Director, Dr. Benson Wairegi said: “The Group’s asset base has increased by 21 percent to Shs 125 billion from Shs 104 billion in December 2018, while shareholders’ funds have increased to Shs 29 billion, a 23 percent growth from 31 December 2018.”

Commenting on the Group’s property strategy, Dr. Wairegi said, “We have reviewed our property strategy to extend our property offerings to third party clients. We will offer property management, development management, and property asset management, through our Asset Management Company. To enhance shareholder returns, our focus will be on property development through own funds or joint ventures. Therefore, our property investment looks to develop, dispose and rent out our property portfolio based on specific business cases.”

During the period under review, the Asset Management business recorded good performance with Assets Under Management (AUM) of Shs 227 billion, accelerated growth of 55 percent from 2018.

The year 2020 presents a challenging macro environment. There are a number of key global and regional risks that will affect the Group including COVID-19, locusts’ invasion and a decline in the stock market performance. The Group is optimistic that there will be a concerted effort to mitigate the effects of these adverse developments on the economies and the world at large.

The company will continue executing its strategy with a specific focus on creating value for the current customer base and developing products/services that resonate with the rest of the market that is under-insured and under-served; continued enhancement of customer experiences supported by investments in technology; and ensuring continued customer convenience by pursuing strategic partnerships that enhance customer value.

The Board of Directors recommends payment of a dividend of 25 cents per share