Par Value: 5/-
Closing Price: 11.00
Total Shares Issued: 144000000.00
Market Capitalization: 1,584,000,000
EPS: 0.79
PE: 13.924
SANLAM Kenya reports HY Earnings through 30th June 2021 versus 6 months through 30th June 2020
HY Gross written Premium 5.921866b versus 4.276831b
HY Net Earned Premium 4.398794b versus 3.014371b
HY Investment and Other Income 1.535346b versus 1.244604b
HY Total Income 5.934140b versus 4.258975b
HY Net Claims and Policyholder benefits [4.083338b] versus [2.475887b]
HY Operating and other expenses [1.793136b] versus [1.639060b]
HY Finance Costs [280.621m] versus [280.067m]
HY Total Benefits claims and other expenses [6.157095b] versus [4.395014b]
HY [Loss] after Tax [291.857m] versus [99.140m]
HY EPS [2.09] versus [0.83]
Conclusions
Big Increase in HY Net Claims and Policyholder benefits [4.083338b] versus [2.475887b]
SanLam reports FY 2020 Earnings versus FY 2019
FY Gross premium Income 8.697626b versus 6.991588b
FY Outward reinsurance premium [1.846020b] versus [1.345042b]
FY Net written premium 6.851606b versus 5.646546b
FY Fees and commission income 458.076m versus 325.064m
FY Investment Income 2.473877b versus 2.350289b
FY Fair Value [losses]/ gains [360.862m] versus 422.177m
FY Total Income 9.428543b versus 8.899079b
FY Net Claims and policyholders benefits [5.731525b] [4.836423b]
FY Fees and commission expense [1.142833b] versus [0.993691b]
FY Other operating and Admin expenses [1.9721126b] versus [2.040589b]
FY Finance Costs [520.996m] versus [457.637m]
FY Total benefits, claims and other expenses [9.385259b] versus [8.348993b]
FY Profit before Tax 43.284m versus 550.086m
FY [loss] profit for the year after Tax [78.217m] versus 114.399m
FY EPS [0.81] versus 0.79
Cash resources at the End of the Year 2.146452b
Company Commentary
Foreign Exchange rates had an adverse impact on the valuation of the Groups net assets
SANLAM LIFE AND SANLAM GENERAL generated 499m and 138m in after Tax Profits respectively
Gross Premium income improved by 24%
Capital and reserves declined by 4% in line with financial performance
No Dividend
Conclusions
Pandemic Year refers.
Underlying insurance business is profitable.
Sanlam reports HY Earnings through 30th June 2020
HY Gross Written Premium 4.276831b versus 3.654964b
HY Net Earned Premium 3.014371b versus 2.757911b
HY Investment and Other Income 1.244604b versus 1.9223259b
HY Total Income 4.258975b versus 4.681170b
HY Net Claims 2.475887b versus 1.991741b
HY Total Expenses 4.395014b versus 3.744097b
HY Profit [Loss] before Tax [136.039m] versus 937.079m
HY Profit [Loss] after Tax [99.14m] versus 639.675m
HY EPS [0.83] versus 4.44
Conclusions
I expect further slippage into the FY Earnings Release.
Sanlam Kenya PLC FY 2019 results through 31st December 2019 vs. 31st December 2018
FY Gross written premium income 6.991588b vs. 6.345825b +10.176%
FY Outward reinsurance premium [1.345042b] vs. [974.017m] +38.092%
FY Net written premium 5.646546b vs. 5.371808b +5.1145
FY Investment income 2.350289b vs. 2.183767b +7.625%
FY Fair value gains/ [losses] 422.177m vs. [1.983581b] +121.284%
FY Impairment of financial assets 2.624m vs. [12.795m] +120.508%
FY Other operating revenue 152.379m vs. 86.214m +76.745%
FY Total income 8.899079b vs. 5.913423b +50.486%
FY Gross benefits and claims paid [5.532435b] vs. [5.544822b] -0.223%
FY Net change in investment and contract liabilities 262.282m vs. [239.674m] +209.433%
FY Net claims and policyholder benefits [4.836423b] vs. [5.124182b] -5.616%
FY Fees and commissions expense [993.691m] vs. [715.134m] +38.952%
FY Other operating and administrative expenses [2.040589b] vs. [2.000047b] +2.027%
FY Total benefits, claims and other expenses [8.348993b] vs. [8.042923b] +3.805%
FY Profit/ [loss] before tax 550.086m vs. [2.129186b] +125.836%
FY Income tax [expense]/ credit [435.687m] vs. 149.760m -390.923%
FY Profit/ [loss] for the year after tax 114.399m vs. [1.979426b] +105.779%
FY Profit/ [loss] attributable to equity holders of the parent 113.334m vs. [2.017061b] +105.619%
EPS (Basic & diluted) 0.79 vs. [14.01] +105.639%
No dividend
Total capital and reserves 1.735022b vs. 1.587038b+9.325%
Total assets 29.032606b vs. 29.101630b -0.237%
Cash resources at the end of the year 1.195292b vs. 2.679107b -55.385%
Financial performance 2019
In 2019, the Group reported an improvement in operating results, posting a pre tax profit of Kes 550 million compared to a prior years loss before tax of Kshs. 2.1 billion.
The profit after tax attributable to the shareholders grew to Kshs.114 million compared to a prior years loss after tax of Kshs.1.98 billion.
Total Income at Kshs. 8.9 billion was a 50% improvement compared to the previous years, while net benefits, claims and expenses increased by 5%.
Gross premium income improved by 10% as a result of growth in the short term insurance business, while Investment performance improved to Kshs. 2.7 billion compared to Kshs.187 million that included the impact of impaired assets in 2019.
The improved performance reflects progress made by the Groups insurance subsidiaries.
Long term insurance business reported a profit after tax of Kshs. 636 million compared to a prior years loss after tax of Kshs. 627 million, while the short term insurance business delivered a 30% growth in gross written premiums.
Total capital and reserves improved by 9% to Kshs.1.74 billion.
The business retains a positive outlook for the year 2020. Revenue and earnings from the Groups insurance business are expected to improve while investment return is expected to reflect positive results from Improved asset management.
The Group will continue investing in its customer value proposition through various product and process innovations.
Dividends
The Board of Directors will not be recommending the payment of dividends for the year ended 31 December 2019 (2018 Nil) at the forthcoming Annual General Meeting scheduled for Thursday 7th May 2020.
The Group Statement of Financial Position, Comprehensive Income, Statement of Changes In Equity and Abridged Cashflow Statement are an extract of the Groups Financial Statements as audited by PricewaterhouseCoopers LLP and have received an unqualified opinion dated 19th February 2020.
The financial statements below were approved by the Groups Board of Directors on 19th February 2020 and signed on its behalf by
Conclusions
Turned it around in 2019
H1 Gross written premium income 3.654964b vs. 3.110722b +17.496%
H1 Net earned premium 2.757911b vs. 2.494578b +10.556%
H1 Investment and other income 1.923259b vs. 41.370m +4,548.922%
H1 Total income 4.681170b vs. 2.535948b +84.593%
H1 Net claims and policyholder benefits [1.991741b] vs. [2.447956b] -18.637%
H1 Operating and other expenses [1.560990b] vs. [1.781524b] -12.379%
H1 Finance costs [191.360m] vs. [77.311m] +147.520%
H1 Total expenditure [3.744091b] vs. [4.306791b] -13.065%
H1 Profit/ [Loss] before tax 937.079m vs. [1.770843b] +153.030%
H1 Profit/ [Loss] after tax 639.675m vs. [1.531415b] +141.770%
H1 EPS (Basic & diluted) 4.44 vs. [10.65] +141.690%
Cash and cash equivalents at end of year 1.670882b vs. 2.679107b -37.633%
Sanlam Kenya PLC FY 2018 results through 31st December 2018 vs. 31st December 2017
FY Gross written premium income 6.345825b vs. 6.369847b -0.377%
FY Outward reinsurance premium [974.017m] vs. [953.632m] -0.694%
FY Net written premium 5.371808b vs. 5.416215b -0.820%
FY Investment income 2.183767b vs. 2.285310b -4.443%
FY Fair value [losses]/ gains [1.983581b] vs. 368.951m -637.627%
FY Impairment of financial assets [12.795m] vs. [1.125243b] -98.863%
FY Total income 5.913423b vs. 7.374761b -19.815%
FY Gross benefits and claims paid [5.544822b] vs. [5.408384b] +2.523%
FY Net change in investment an contract liabilities [239.674m] vs. 290.581m -182.481%
FY Net claims and policyholder benefits [5.124182b] vs. [4.534482b] +13.005%
FY Fees and commissions expense [715.134m] vs. [735.150m] +2.723%
FY Other operating and administrative expenses [2.000047b] vs. [1.843601b] +8.486%
FY Total benefits, claims and other expenses [8.042923b] vs. [7.123696b] +12.904%
FY [Loss]/ profit before tax [2.129500b] vs. 251.065m -948.187%
FY Share of loss of an associate 0.314m vs. [4.107m] -107.645%
FY [Loss]/ profit before tax [2.129186b] vs. 246.958m -962.165%
FY [Loss]/ profit for the year after tax [1.979426b] vs. 53.045m -3,831.598%
EPS (Basic & diluted) [14.01] vs. 0.21 -6,771.429%
No dividend
Total capital and reserves 1.587038b vs. 4.051950b -60.833%
Total assets 29.101630b vs. 29.811484b vs. 28.442590b -2.381%
Cash resources at the end of the year 2.679107b vs. 2.541211b +5.426%
Company Commentary
Several Institutions in which the Groups Long term Insurer had invested came under financial distress which led to the impairment of 1.14b in investments, primarily debt notes and equity in Kaluworks, Real People and Athi River Mining
The Companys reserving basis was revised reflecting a more prudent basis prescribed by the Regulator which led to an additional 0.65b reduction in earnings.
Conclusions
They took a big hit but it was already factored in.
Sanlam Kenya PLC H1 2018 results through 30th June 2018 vs. 30th June 2017
H1 Gross written premium income 3.340848b vs. 3.308030b +0.992%
H1 Net earned premium 2.494578b vs. 2.724794b -8.449%
H1 Investment and other income 1.193699b vs. 1.571115b -24.022%
H1 Total income 3.688277b vs. 4.295909b -14.144%
H1 Net claims and policyholder benefits [2.447956b] vs. [2.751422b] -11.029%
H1 Operating and other expenses [1.781524b] vs. [1.391963b] +27.986%
H1 Impairment of financial assets [1.152329b] vs.
H1 Finance costs [77.311m] vs.
H1 Total expenditure [5.459120b] vs. [4.143385b] +31.755%
H1 [Loss]/ Profit before tax [1.770843b] vs. 152.524m -1,261.026%
H1 [Loss]/ Profit after tax [1.531415b] vs. 90.528m -1,791.648%
H1 EPS (Basic & diluted) [10.5] vs. 0.62 -1,793.548%
Total equity 2.399737b
Total assets 28.161780b
Cash resources at the end of the year 1.864942b
Conclusions
The Question is whether they have taken the whole hit
H1 Impairment of financial assets [1.152329b]
Sanlam Kenya PLC FY 2017 results through 31st December 2017 vs. 31st December 2016
FY Gross written premium income 6.369847b vs. 5.224546b +21.922%
FY Outward reinsurance premium [953.632m] vs. [392.341m] +143.062%
FY Net written premium 5.416215b vs. 4.832205b +12.086%
FY Investment income 2.285310b vs. 2.418532b -5.508%
FY Fair value gains 368.951m vs. [450.341m] +181.927%
FY Total income 8.500004b vs. 7.154074b +18.813%
FY Gross benefits and claims paid [5.408384b] vs. [4.193984b] +28.956%
FY Reinsurers share of claims 583.321m vs. 204.498m +185.245%
FY Net change in investment an contract liabilities 290.581m vs. [488.981b] +159.426%
FY Net claims and policyholder benefits [4.534482b] vs. [4.478467b] +1.251%
FY Operating and other expenses [1.843601b] vs. [1.576197b] +16.965%
FY Impairment of financial assets [1.125243b] vs. [93.397m] +1,104.796%
FY Total benefits, claims and other expenses [8.248939b] vs. [6.836801b] +20.655%
FY Profit before tax 246.958m vs. 317.053m -22.108%
FY Profit for the year after tax 53.045m vs. 70.623m -24.890%
FY Profit attributable to equity holders of the parent 30.814m vs. 90.252m -65.858%
EPS (Basic & diluted) 0.21 vs. 0.63 -66.667%
No dividend
Total capital and reserves 4.051950b vs. 3.932244b +3.044%
Fair value through profit/loss of financial assets 9.934526b vs. 8.836392b -5.892%
Total assets 29.811484b vs. 28.442590b +4.813%
Cash resources at the end of the year 2.541211b vs. 2.497436b +1.753%
Company Commentary
Despite the slowed economic growth recorded in the year, the Insurance Industry recorded a +10.7% growth in premiums during the period to September 2017 compared to 7.2% in similar period of 2016.
Life Insurance segment grew +16.9% compared to general insurance segment that grew by 7.2%
General insurance accounted for 62.3% of 160.6b of premiums collected as at the end of September 2017
NASI +28.4% versus [8.5%] in 2016
FTSE bond Index +16.5% from [0.2%] in 2016
New Risk based capital requirements which come into full effect in June 2020
Life Insurance Business gross written premium declined by 2% to 4.3b from 4.4b in 2016
General Insurance business underwriting profit of 40m. Gross written premium grew by 115%. from 1b to 2.15b
Investment returns increased 6,634% to 61m
Conclusions
The issue at hand
FY Impairment of financial assets [1.125243b] vs. [93.397m] +1,104.796%
H1 Gross premium income 3.362551b vs. 2.639297b +27.403%
H1 Outward reinsurance premium [637.757m] vs. [200.884m] +217.475%
H1 Net written premium 2.724794b vs. 2.438413b +11.745%
H1 Investment income 1.205769b vs. 1.250684b -3.591%
H1 Fair value gains 199.042m vs. [151.010m] +231.807%
H1 Fees and commissions earned 163.794m vs. 38.703m +323.208%
H1 Total income 4.295909b vs. 3.616845b +18.775%
H1 Gross benefits and claims paid [2.285688b] vs. [1.883908b] +21.327%
H1 Net change in contract liabilities [511.736m] vs. [765.969m] -33.191%
H1 Net claims and policyholder benefits [2.751422b] vs. [2.620053b] +5.014%
H1 Operating and other expenses [979.552m] vs. [735.246m] +33.228%
H1 Total expenses [4.143385b] vs. [3.761571b] +10.150%
H1 Profit before tax 152.524m vs. [144.726m] +205.388%
H1 Profit after tax 90.528m vs. [128.369m] +170.522%
Basic and diluted EPS 0.62 vs. [0.89] +169.663%
Total capital and reserves 4.022722b vs. 3.673678b +9.501%
Held to maturity financial assets 9.406658b vs. 8.366283b +12.435%
Fair value through profit or loss financial assets 10.136447b vs. 10.392802b -2.467%
Total assets 29.811254b vs. 27.994884b +6.488%
Insurance contract liabilities 13.234952b vs. 12.106609b +9.320%
Cash resources at the end of the year 3.044899b vs. 3.533967b -13.839%
Company Commentary
Key Features
Profit before Tax 153m versus [2016:-145m]
Total Assets +5% 29.8b
Group embedded Value increased to 5.2b [2016 4.7b] +10.3% over 6 months
The main regulatory development in the insurance sector was the gazettement of The Statute Law Act 2017 postponing the effective date of complying with the new capital requirements to June 2020
Life insurance
Gross written premiums increased by 1% to 2.3b
Investment portfolio earnings increased by 20% to 1.4b in 2017 driven by higher revaluation gains from mark to market investments
Life insurance business operating profit of 259m versus 106m in 2016
General Insurance
Gross written premiums grew by 225% to 1.3b
The loss ratio in H1 2017 was within expectations but slightly above the comparable period due to a higher claims experience in the medical line of business
Operating expenses were negatively affected by an increase in bad debt provisions
The integration of SEM asset management businesses in the region has commenced reference Pinebridge
Conclusions
making progress, remains rich on a classic PE Ratio basis.
Year End through 31st December 2016
FY Gross written premium 5.224546b vs. 5.181614b +0.829%
FY Outward reinsurance premium [329.341m] vs. [384.628m] -14.374%
FY Net written premium 4.832205b vs. 4.796986b +0.734%
FY Investment income 2.518645b vs. 2.388531b +5.447%
FY Fair value gains [450.341m] vs. [637.144m] -29.319%
FY Total income 7.154074m vs. 7.237184b -1.148%
FY Gross benefits and claims paid [4.193984b] vs. [3.620249b] +15.848%
FY Reinsurers share of claims 204.498m vs. 96.593m +111.711%
FY Net change in contract liabilities [488.981m] vs. [733.559m] -33.341%
FY Net claims and policy holder benefits [4.478467b] vs. [4.257215b] +5.197%
FY Operating and other expenses [1.669594b] vs. [1.466658b] +13.837%
FY Total benefits, claims and other expenses [6.836801b] vs. [7.186122b] -4.861%
FY Profit before tax 317.053m vs. 54.325m +483.623%
FY Profit for the year after tax 70.623m vs. 27.350m +158.219%
FY Comprehensive income attributable to equity holders of the parent 106.061m vs. [61.559m] +272.292%
EPS (Basic & diluted) 0.63 vs. [0.43] +246.512%
Total capital and reserves 3.932244b vs. 3.802047b +3.424%
Total assets 28.442590b vs. 27.109278b +4.918%
Insurance contract liabilities 12.704048b vs. 11.397467b +11.464%
Cash resources at the end of the year 2.497436b vs. 3.916168b -36.228%
Company Commentary
Life Insurance Gross written premium declined by 5% to 4.4b from 4.6b in 2015
retail business was impacted by the expected effects of streamlining the distribution channels and agency force aimed at improving productivity going forward
Investment Portfolio earnings increased by 50% to 2.1b in 2016 driven by good investment returns
General Insurance gross written premium grew by 58%
Income from property sales declined due to a depressed property market
Asset Management Fee income increased by 31%
No Dividend
Conclusions
much better than expected results.
H1 Gross written premium 2.639297b vs. 2.594647b +1.721%
H1 Outward reinsurance premium [200.884m] vs. [209.164m] -3.959%
H1 Net written premium 2.438413b vs. 2.385483b +2.219%
H1 Total income 3.616845b vs. 3.563330b +1.502%
H1 Gross benefits and claims paid [1.883908b] vs. [1.570386b] +19.965%
H1 Net change in contract liabilities [765.969m] vs. [542.484m] +41.197%
H1 Net claims and policy holders benefits [2.620053b] vs. [2.083221b] +25.769%
H1 Total benefits, claims and other expenses [3.761571b] vs. [3.151631b] +19.353%
H1 [Loss] profit before share of profit of an associate [144.726m] vs. 411.699m -135.153%
H1 [Loss] profit before tax [144.727m] vs. 411.699m -135.154%
H1 [Loss] profit for the year after tax [128.369m] vs. 263.963m -148.631%
H1 [Loss] profit attributable to equity holders of the parent [128.500m] vs. 267.243m -148.084%
EPS [0.89] vs. 1.86 -147.849%
Total assets 27.994882b vs. 27.077022b +3.390%
Cash resources at the end of the year 3.533967b vs. 4.655231b -24.086%
No interim dividend
Company Commentary
The Group recorded a loss before tax of -145m for the six months ended 30th June 2016, compared to a profit of 412m for the same period in 2015.
This is mainly attributable to lower income from property sales, marked to marketfair value losses on equity investments, an increase in expenses related to the implementation of the new Group strategy and negative persistency experience in the life book.
Portfolio earnings increased by 98% from 607m to 1.2b in 2016.
Conclusions
Tidying up and working through the digestion Phase.
FY Gross written premium 5.181614b vs. 5.246527b -1.237%
FY Outward reinsurance premium [384.628m] vs. [255.757m] +50.388%
FY Investment income 2.388531m vs. 1.993175b +19.835%
FY Fair value [losses] income [637.144m] vs. 648.386m -198.266%
FY Total income 7.237184b vs. 7.974995b -9.252%
FY Insurance outgo [4.257215b] vs. [5.053694b] -15.760%
FY Commission and operating expenses [2.301649b] vs. [1.751465b]
+31.413%
FY Total expenses [7.186122b] vs. [6.825007b] +5.291%
FY Profit before tax 0.054325b vs. 1.152598b -95.287%
FY Profit for the year after tax 27.350m vs. 871.190m -95.68%
FY Profit attributable to equity holders of the parent [61.559m] vs.
871.190m -107.066%
EPS [0.43] vs. 6.05 -107.107%
Dividends
Cash and cash equivalents at the end of the year 3.916168b vs. 3.981296b -1.636%
Company Commentary
-95% decline in FY Profit before Tax
The Asset Management and property businesses exceeded 2014 operating profit levels whilst the life insurance and Loans businesses
performance declined.
Newly acquired General Insurance business also under performed.
Life Insurance business was negatively impacted by challenges experienced with our distribution network from Q3 2014 to Q3 2015
No Dividend
Conclusions
Fair Value Losses will be a common theme across this Sector. |
