Listed financial services group Botswana Insurance Holdings Limited (BIHL) says its results for the year ended 31 December 2015 will be higher than those reported for the previous year, 31 December 2014.
The Botswana Stock Exchange (BSE) listed group said it was able to overcome prevailing challenges in the market because of positive investment returns driven by excellent performance in some of its operations. The group made the announcement in line with the BSE listing requirements, which require BIHL to announce any circumstances or events that have or are likely to have a material effect on its financial results.
“The board of BIHL hereby advises its stakeholders that the group’s results for the year ended 31 December 2015 will be higher than those reported for the year ended 31 December 2014. The results will be published by 2 March 2016 and shareholders and investors are advised to exercise caution when trading in the company’s securities until such time as a detailed announcement is made,” read a statement from BIHL.
In the previous results, income from BIHL’s life insurance business grew by six percent over prior year from P1.84 billion to P1.95 billion with all lines contributing to the positive movement. Operating profit grew 15 percent y/y to P317.5 million from P275.7 million. The value of new business, which represents the present value of future profits from new business premiums written during the year, also grew by an excellent 40 percent y/y. Unit acquisition costs reduced by 13 percent compared to the previous year due to improved new business volumes and disciplined expenditure. BIHL’s asset management company, Botswana Insurance Fund Management (Bifm) also recorded satisfactory results in 2014 as a result of continued growth of assets under management and positive net client contributions. BIHL also sold its BIHL Sure business to Botswana Insurance Company (BIC) in August 2014. BIHL Sure comprised of two distinct business lines; the general lines that provided conventional short term insurance solutions and Legal Guard, the leading legal expenses cover product in the country. However, the short term insurance failed to deliver according to expectation as the company grappled with market challenges like strong price competition and slower than anticipated penetration of the commercial lines market. In the end, BIHL decided to discontinue offering short term insurance in mid-2014 and sold the business to BIC.