Business / Companies
Nicoz Diamond releases an exciting set of results
26 Aug 2011 at 12:15hrs | Views
An exciting set of results from Nicoz Diamond, driven by new business acquisitions in both Uganda and Zimbabwe, which contributed 25% of the total premium written. Gross premium written amounted to $11.7 million up 41% from the prior period, whilst after a commendable retention NPW amounted to $7.9 million (H1 2010: $5.7 million).
Investment income totalled $262,313 up from $220,990 as the portfolio performed well. Total revenue thus stood at $8 million up 48% from H1 2010. Net claims and acquisition costs grew by a high 75%, as claims continue to be relatively high. For the interim period, the CI/NEP was 47%, however management is comfortable with the ratio as it is within the internationally acceptable ranges of 40%-60%. The total expenses/NPW ratio however improved to 35% from 45%.
The underwriting profit for the period was $492,859, although the Ugandan operation registered an underwriting loss due to depressed business volumes versus high expenses and claims. The share of associate profits at $140,525 lifted the PBT to $724,532 from a loss position of $1.1 million. The attributable profit for the period was $567,718.
The balance sheet remains strong, showing a current ratio of 1.5x. The company has short term investments of $5.3 million, comprised of $4 million in money market deposits and $1.2 million in quoted equities. On the current liabilities, the group has short term provisions of $5 million, with $3.2m being unearned premium reserves whilst the balance is outstanding claims and IBNR.
Management is confident about the company's future prospects given the recovery that is coming through in Zimbabwe from the economy's different sectors, notably agriculture and mining. This is expected to lead to increased insurance take up and maintain the positive momentum that has now been set. Efforts are being made to turnaround the Ugandan operation's operations by growing the top line to align expenses with revenues, and to increase the business's capitalisation so as to write and retain more business thereby lowering the acquisition cost.
Investment income totalled $262,313 up from $220,990 as the portfolio performed well. Total revenue thus stood at $8 million up 48% from H1 2010. Net claims and acquisition costs grew by a high 75%, as claims continue to be relatively high. For the interim period, the CI/NEP was 47%, however management is comfortable with the ratio as it is within the internationally acceptable ranges of 40%-60%. The total expenses/NPW ratio however improved to 35% from 45%.
The underwriting profit for the period was $492,859, although the Ugandan operation registered an underwriting loss due to depressed business volumes versus high expenses and claims. The share of associate profits at $140,525 lifted the PBT to $724,532 from a loss position of $1.1 million. The attributable profit for the period was $567,718.
The balance sheet remains strong, showing a current ratio of 1.5x. The company has short term investments of $5.3 million, comprised of $4 million in money market deposits and $1.2 million in quoted equities. On the current liabilities, the group has short term provisions of $5 million, with $3.2m being unearned premium reserves whilst the balance is outstanding claims and IBNR.
Management is confident about the company's future prospects given the recovery that is coming through in Zimbabwe from the economy's different sectors, notably agriculture and mining. This is expected to lead to increased insurance take up and maintain the positive momentum that has now been set. Efforts are being made to turnaround the Ugandan operation's operations by growing the top line to align expenses with revenues, and to increase the business's capitalisation so as to write and retain more business thereby lowering the acquisition cost.
Source - Imara
