The Group recorded an improved year-on-year performance with Profit Before Tax (PBT) of Sh517 million ($5.17 million) compared to Sh445 million ($4.45 million) in the same period last year, an increase of 16.3%.
“We attribute the good performance to a steady growth in Net Earned Premium coupled with robust savings in operating expenses which declined by 8% year-on-year,” said Peter Mwangi, UAP Old Mutual Group CEO in his address to investors.
Mr. Mwangi also cited that the cost reduction was a result of payroll savings realized after the reorganization exercise in H1 2018 and concerted efforts to manage expenses Groupwide.
The claims experience increased due to the operating environment particularly for the Medical business and additional boosts to reserves in the Life Business because of growth.
The total impact was a rise in Net Claims expense. Investment Income declined by 7.7% mainly due to the impact of property valuation write-downs.
Although the NSE 20 Index on the Nairobi Securities Exchange had negative returns for the period, the investment portfolio fared relatively well with the only adverse impact from the property portfolio.
In aggregate, the Group’s PBT grew and consequently Profit After Tax (PAT) rose from Sh190 million ($1,9 million) in H12018 to Sh383 million ($3.83 million) in H12019 marking 101.5% growth.