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Harare - Strong performance by the life business as well as the banking unit saw Old Mutual Zimbabwe report a strong set of results for the year to end-December 2015.
Speaking at an analysts' briefing held on Wednesday, Old Mutual Zimbabwe managing director Jonas Mushosho said the insurance giant achieved 6% growth in total revenue to $203.8m. The bulk of this - at least 76% - came from the life business as well as the banking unit CABS.
CABS contributed US$100.8m to total revenue while net earned premiums from the insurance business amounted to $171.2m, up from $160.5m in the prior comparative year.
Mushosho said the performance of the banking unit was on the back of 27% growth in loans and advances to $563.1m.
Total revenue was, however, weighed down by the negative performance of the asset management business were investment income was a negative $126.2m, 25% lower than a loss position of $101.2m prior year.
Mushosho said the negative outturn of the asset management business was on the back of negative returns that were experienced on the Zimbabwe Stock Exchange, where the main industrials index was down 29.44% in 2015.
Financial director Isaiah Mashinya said the poor performance of the stock market was on the back of depressed company earnings and negative investor sentiment that continued to weigh down equity returns.
Contribution from investment properties was also subdued, with rental income coming down to $10.4m from $13.4m in the prior year.
Mushosho said the performance of investment properties was weighed down by downward reviews on rentals and increased vacancy levels. As a result, the valuation of investment properties was reduced to $408.4m from $439.9m to reflect the subdued rental yields.
Performance of the banking unit as well as the life business, however, carried the day with the group closing the period with an adjusted operating profit of $76.0m, up 5% from the previous year.
The group’s profit after adjusting for short-term fluctuations in the equity markets amounted to $57.3m, slightly lower than the $58m recorded in the prior year.
Without the adjustments, profit for the year amounted to $13.3m, up from $10.9m in the prior comparative year. Basic earnings per share amounted to 3.71 US cents, up from 3.09c prior year.
Going forward, focus of the group will be on defending and extending the core business as well as driving financial inclusion within the informal market, believed to employ about 94% of the working population.
Speaking at an analysts' briefing held on Wednesday, Old Mutual Zimbabwe managing director Jonas Mushosho said the insurance giant achieved 6% growth in total revenue to $203.8m. The bulk of this - at least 76% - came from the life business as well as the banking unit CABS.
CABS contributed US$100.8m to total revenue while net earned premiums from the insurance business amounted to $171.2m, up from $160.5m in the prior comparative year.
Mushosho said the performance of the banking unit was on the back of 27% growth in loans and advances to $563.1m.
Total revenue was, however, weighed down by the negative performance of the asset management business were investment income was a negative $126.2m, 25% lower than a loss position of $101.2m prior year.
Mushosho said the negative outturn of the asset management business was on the back of negative returns that were experienced on the Zimbabwe Stock Exchange, where the main industrials index was down 29.44% in 2015.
Financial director Isaiah Mashinya said the poor performance of the stock market was on the back of depressed company earnings and negative investor sentiment that continued to weigh down equity returns.
Contribution from investment properties was also subdued, with rental income coming down to $10.4m from $13.4m in the prior year.
Mushosho said the performance of investment properties was weighed down by downward reviews on rentals and increased vacancy levels. As a result, the valuation of investment properties was reduced to $408.4m from $439.9m to reflect the subdued rental yields.
Performance of the banking unit as well as the life business, however, carried the day with the group closing the period with an adjusted operating profit of $76.0m, up 5% from the previous year.
The group’s profit after adjusting for short-term fluctuations in the equity markets amounted to $57.3m, slightly lower than the $58m recorded in the prior year.
Without the adjustments, profit for the year amounted to $13.3m, up from $10.9m in the prior comparative year. Basic earnings per share amounted to 3.71 US cents, up from 3.09c prior year.
Going forward, focus of the group will be on defending and extending the core business as well as driving financial inclusion within the informal market, believed to employ about 94% of the working population.
