First Mutual profit hits $17,6 billion in Q1

Listed insurer, First Mutual Holdings, says its first quarter to March 31, 2023 profits bulked 616 percent to $17,6 billion as insurance contract revenues increased.

Sheila Lorimer, First Mutual company secretary in a trading update said; “The Group achieved a profit for the period of $17.6 billion which represented a 616 percent increase relative to prior year.”

The increase was attributed to the increases in insurance contract revenue, rental income, net fair value gains in investment properties as well as net investment return due to some recovery in First Mutual’s listed equity portfolio.

Said Lorimer; “In the period under review, rental income grew by 584 percent to $1.4 billion. The growth arose from a combination of factors which included a higher proportion of USD denominated leases as well as inflation driven on ZWL rental rate increases.”

The occupancy levels stood at 84,55 percent compared to the prior year of 89,99 percent and the average rental/square metre was US$4.73 compared to prior year of US$4.61.

In the period under review, overall group net investment returns amounted to $7,9 billion, 159 percent above prior year and the growth was driven by recoveries on the ZSE.

The Insurance service result grew by 446 percent to $3,8 billion compared to the prior period as the growth is a result of increases in the insurance contract revenue as well as improved retention of the same as demonstrated by growth of the net reinsurance revenue.

“During the period under review, Insurance contract revenue at $25,9 billion grew by 497 percent compared to the same period in prior year.

The growth was driven by the continued revaluation of insurance policy values to match inflation and exchange rate movements to ensure adequate cover for clients as well as a migration of more policies to the USD for value restoration in case of the occurrence of an insured event,” she added.

The proportion of the USD business being written by the group constituted 53 percent of the total insurance contract revenue at US$14,7 million compared to 54 percent in the same period last year.-ebusinessweekly