Zimre Holdings narrows loss from $23 million to $2 million

Zimre Holdings narrowed its loss by 90 percent to $2.2 million for the full-year to December, from $23.1 million recorded in the preceding year on increased business retention and cost containment measures.

“The improvement was mainly due to increased business retention, favourable claims experience, the positive impact of the group restructuring and cost cutting measures being implemented and reduction in share of losses from associates,” said chairman Ben Khumalo.

Total income dropped 14 percent to $28.1 million as a result of a decline in gross premiums written.

Net premiums earned which accounted for 77 percent of total income was down 8 percent to $21.8 million in the period, from $23.8 million in the previous year due to a soft domestic insurance market and weak local currencies in the group’s major regional markets of Mozambique and Malawi.

Total assets fell 7 percent to $102.8 million in the period compared to $110.5 million in the preceding year.

Khumalo said the group’s domestic reinsurance business, Baobab Reinsurance narrowed its operating losses to $700 000 from the $4.8 million recorded in the previous year on improved underwriting standards.

However on regional reinsurance, profit for the year decreased by 69 percent to $400 000 in the period from $1.3 million in the prior year after gross premiums declined by 31 percent to $17 million.

The life and health insurance businesses gross premiums written were down 18 percent to $4.2 million while operating profit decreased by 8 percent to $1.1 million in the period from $1.2 million previously.

Revenue generated from property rose by 5 percent to $4 million compared to $3.8 million reported in the preceding year.

Contributions from the group’s associates Nicoz Diamond, Fidelity and CFI remained low weighed down by losses in CFI Holdings, Khumalo added.

However, CFI Holdings is envisaged to recover following a debt restructuring exercise which lowered its debt from $19.1 million to $5.1 million. – The Source

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