Zimre sees 24% growth in total income to US$26.2m in May
HARARE – Zimre Holdings says that despite a slow start to the first quarter, total income grew by 24% to US$26.2 million in the five months to May against the comparable year ago period. This was largely attributed to the reinsurance and life assurance clusters.
The group has now adopted the US dollar as its functional currency as revenue inflows at the end of May stood at 86%, which is an increase from 78% as at December 31, 2023.
CEO Stan Kudenga told the AGM this morning that reinsurance income in the period was at US$15.2 million, a growth of 31% on last year. Insurance contract revenue remains the primary driver, accounting for 97% of the total income.
“Strategic initiatives in key markets led to new business acquisition and expanded market share in the regional operations.” This included the successful integration of the two reinsurance operations in Botswana and recapitalisation of the Mozambique subsidiary. As a result, this has positioned the segment for further growth, enhanced underwriting capability and expanded offerings in new business classes.
The group is at various stages of providing adequate and competitive capital to its regional operations to enhance underwriting capacity and extending market share.
Short term insurance saw a 3% decline in insurance contract revenue. “Nevertheless, concerted efforts to grow the core and profitable lines of the business are beginning to bear fruit and should transform the segments fortunes together with strict management of acquisition costs, following significant increases in brokerage costs.” The segment had seen a notable increase in direct business, which grew 46% in the period.
Property saw a 4% decline in rental revenue but the portfolio had a strong collection rate of 90%, which was however slightly lower than the 93% achieved last year. Portfolio voids averaged 15%, improving from 22% last year.
Insurance broking had a total income of US$0.6 million largely at par with last year. “The business is poised for growth with strategic focus in organic expansion.
The life and pensions cluster recorded a 31% increase in insurance contract revenue to US$6.6 million. Total income rose to US$7.6 million from US$6.4 million last year.
The wealth management cluster saw broader revenue streams, resulting in a 108% increase in revenue to US$1.2 million. The Eagle REIT made progress particularly on the Mazowe Mall development.
Group total expenses increased by 33% to US$22.6 million driven by insurance claims from the reinsurance cluster.
Resultantly, the group posted a profit of US$3.7 million, up 6% from 3.5 million reported in the same period last year.
Looking ahead, Kudenga said the group will continue to deliver profitable growth, long term value for stakeholders by leveraging its insurance value chain, infrastructure development and regional ecosystem.-finx
