HARARE, September 20 (The Source) – First Mutual Holdings’ net profit grew nearly five-fold, to $2,6 million from $442,000 in the six months to June as a result of cost containment measures and strict management of claims, the company said on Tuesday.
Operating profit stood at $4,9 million compared to $1,8 million last year, largely due to lower claims in the insurance business and a $900 000 reduction in administrative expenses.
Total Gross Premium Written (GPW) marginally increased to $60,6 million from $60,2 million driven by positive performance from the health, life assurance and pension business segments.
Health insurance GPW stood at $26 million compared to $25 million last year while the life assurance registered an 18 percent increase in GPW to $18,4 million.
The group’s subsidiary Pearl Properties registered a 2 percent decline in revenue from $4,3 million to $4,2 million in the six month period as rental income fell 5 percent to $4 million.
The decrease was driven by a decline in the occupancy level and and reduced rental income across the property portfolio.
Tenant arrears were at $2,4 million compared to $2,6 million last year while occupancy levels were down from 77 percent to 72 percent with voids occurring largely within the central business district.
In a statement accompanying company results on Tuesday chairman Oliver Mtasa said a valuation of the investment property portfolio had resulted in a fair value loss of $3,7 million to $118,5 million.
“The impairment is driven by rising vacancies that have added pressure on rentals, increasing tenant defaults and an illiquid property sales market.
The group’s assets marginally grew to $212,6 million from $209 million.The board did not declare dividends.