Suncorp posts 74 per cent first-half profit rise
Suncorp Group has reported a 74 per cent increase its first-half profit to $389 million, up from $223 million in the prior corresponding period.
The Queensland-based bank and insurer beat forecasts after increasing its premiums in reaction to a year of unprecedented disaster-related claims and rising reinsurance costs. The average forecast from Thompson Reuters IBES had put Suncorp’s estimated profit at $366 million.
The group’s revenue was flat in the six months to 31 December 2011, edging up 0.5 per cent to $8.12 billion, while bad weather saw the general insurance division’s profit plummet to $162 million from $292 million. The result was impacted by natural hazard claims which were $149 million above allowances, as well as falling interest rates and increased reinsurance costs.
The group net profit however increased largely through one-off items, including a $63 million gain on the sale of property, plant and equipment, while the previous corresponding period included a $106 million loss on the disposal of some subsidiaries.
Suncorp chief executive Patrick Snowball said Suncorp’s half year results underlined the progress the group was making in transforming and simplifying its business.
“Although external challenges mean that our first half profit is still not what we, and our shareholders, know this business is capable of, I’m proud of what Suncorp has achieved over the last six months and am confident the transformation of our Group is on track,” he said.
Suncorp bank posted a net after-tax profit of $102 million for the half. The banking division recorded a “core” net profit of $156 million, up from $110 million in the first-half of the previous financial year. However that result was offset by a $54 million net loss on its non-core portfolio.
The bank’s life insurance division recorded an after-tax profit for the half of $133 million, with an underlying profit of $69 million.
Suncorp announced an interim dividend of 20 cents per share fully franked, with basic cash earnings per share of 34.13 cents. The group’s capital position remained “healthy” over the period - more than $1.18 billion was identified as surplus to the group’s internal targets despite Suncorp paying down a further $221 million in subordinated debt and repurchasing $72 million of reset preference shares during the half.
- Categories
- Banking
- Tags:
- Suncorp Group, Patrick Snowball, profit, first half
- Author:
- Michael Davis, mdavis@financialpublications.com.au
- Article Posted:
- February 22, 2012
Review this content
Fields marked with an asterisk (
) are mandatory.