nib announces $42.7m pre tax underwriting profit
nib holdings has announced a pre tax underwriting profit of $42.7 million for the six months ended 31 December 2011, up from $40.9 million in the first half of the year.
Premium revenue was up 12 per cent to $554.4 million while net profit after tax of $38.3 million was marginally down from $39 million in the first half of 2011, due to a $6.2 million reduction in net investment income, the firm announced.
Investment returns achieved over the 1H12 were consistent with external market conditions and were in line with relevant benchmarks, nib said. However, a reduction in actual funds invested did have a significant impact.
There were less invested funds following capital management initiatives undertaken such as the $75 million capital return in July 2011 and payment of $23.3 million in special dividends in September 2011.
However, return on equity for the first half of the year was very strong at 18 per cent compared to 14.8 per cent for the first half of 2011, while earnings per share was also up 2.5 per cent to 8.2 cps from 8.0 per cent in the first half of 2011.
The insurer also declared an interim fully franked ordinary dividend of 4.25 cps totalling $19.8 million, up from 4.0 per cent over the same period last year.
As at 31 December 2011 after allowing for the interim dividend payment due on 5 April 2012, nib has approximately $57 million of surplus funds above the company’s internal prudential target and no debt.
Commenting on the results, Mark Fitzgibbon, managing director at nib, said the half year result meant the health insurer was well positioned to deliver improved underwriting profitability for the full financial year.
He said: “Underwriting performance continues to reflect above the industry average organic growth and an increasing contribution by our international workers business.
“Achieving returns above our cost of capital is our main commercial aim and our challenge from here is to improve even further.”
- Categories
- Insurance
- Tags:
- nib, first-half profit, Mark Fitzgibbon
- Author:
- Angela Faherty, afaherty@financialpublications.com.au
- Article Posted:
- February 20, 2012
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