ZIMRE bounces back

ZIMRE Holdings Limited returned to profitability after recording a net profit of US$1,1 million in the six months ended June 30 2011 from a loss of US$322 038 in the same period last year.

Group chairman, Benjamin Khumalo, said this was the result of a favourable claims situation in the majority of the insurance operations and fair-value adjustment in long-term equity investments.

“The group’s cost cutting measures are now bearing fruit,” said Khumalo, adding that the improved performance was ascribed to increased uptake of insurance products in both the foreign and domestic markets.

ZHL is a holding company of financial services companies in general insurance, reinsurance and insurance broking. In the period under review, Gross Premium Written was at US$28,4 million, representing a growth of 27 percent over the same period last year. Khumalo said that foreign operations contributed 63 percent of the GPW while domestic operations contributed 37 percent. ZHL has a significant presence in Zambia and Malawi through associate companies.

Khumalo said the market was experiencing liquidity challenges which were affecting interest and customer default rates.

The sector’s profit before tax during the period under review stood at US$2,4 million against US$0,4 million achieved in the same period 2010. This increase in profitability was attributed to the favourable claims experience.

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