FML records marginal growth

FIRST-MUTUAL1Business Reporter

FIRST Mutual Holdings incurred investment losses of $4,7 million in the year to December last year which the group said was in line with the downward movement in the stock market. Investment losses for the prior year were at $3,8 million. In the twelve months to December 2015, the group recorded a marginal one percent growth in gross premium written at $116,1 million compared to $115,3 million for the comparative period.Rental income decreased by three percent to $7,3 million in the period under review from $7,5 million in the prior year.

The company blamed current challenges faced by tenants and the resultant decline in occupancy levels and rentals per square metre.

The average rental per square metre decreased to $7,59 in 2015 from $7,86 in 2014.

The occupancy rate for the period was 79 percent compared to 80 percent in the prior year.

FMH realised an overall profit for the year of $0,1 million compared to a loss for the year of $5,1 million in the previous year.

The total comprehensive profit attributable to shareholders of the parent company for the year was $0,2 million compared to a loss of $6,5 million in 2014.

Group chief executive officer said the improvement in the financial performance was a result of increased revenue mainly in the health and reinsurance businesses, efficient claims management and cost containment strategies, including the staff rationalisation exercise carried out in 2014.

The health insurance business realised a five percent growth in the year to December 2015 to $52 481 000 from $50 192 000 in the comparative period.

In the outlook the group is confident that business process efficiencies being implemented coupled with prudent cost containment measures will position it to deliver value to its stakeholders.

It said the insurance sector is expected to deliver modest growth driven by sustained demand for retail products while the employee benefits segment is likely to shrink further due to limited growth in the formal employment sector.

In that regard, the group will maintain a prudent approach in respect of its investment.

Investment returns are projected to improve driven by the positive performance of fixed income securities and the resilience of the property sector while bearish conditions on the Zimbabwe Stock Exchange will continue to dampen the performance of equities.

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