Harare – Diversified insurance firm, Fidelity Life’s total revenue for the half year ended June 30, 2018 amounted to $25.8 million compared to $13.1 million for the same period last year which is a 97 percent increase.

In a statement accompanying the Group’s financial results, Chairman Fungai Ruwende attributed the increase to the recognition of residential stands revenue upon receipt of compliance certificates from the local authority, and strong growth in premium revenue.

“Stand sales for the first half of 2018 stood at US$12m, compared to nil sales in 2017 first half, as stand sales for last year only occurred in the second half of the year.

“Gross written premiums increased by 43 percent compared to prior year, driven by renewal and clear focus of the sales and distribution function, particularly in the employee benefits segment.”

He said at 83 percent of total revenue, the two lines continue to be the dominant revenue generators for the Group.

In the period under review, interest income from residential stands sales and micro-lending receivables grew by 23 percent and 18 respectively.

Ruwende said these positive trends in revenue were however countered by poor performance on investments as fair value losses of US$1.2m were recorded on the equity portfolio held by the Group, compared to gains of US$1.65m recorded during the same period in 2017.

“Overall however, the Group’s performance was strong, with a 97 percent increase in revenue recognized in the half year to 30 June 2018, compared to the half year to 30 June 2017.”

During the period under review gross claims reduced by 11 percent from US$2.8m to US$2.5m.

Operating expenses increased by 56 percent largely due to the Group’s restructuring activities designed to achieve optimal operational efficiencies.

Ruwende said expenses for the current half year also include cost of residential stands sold.

He said finance costs expensed by the Group increased by 64 percent during the half year compared to the same period last year.

Previously, some of the borrowing costs were capitalized against qualifying assets under development.

For the period, the Group closed the half year with a profit before tax of US$3.7m, 54 percent ahead of US$2.4m reported for the period to 30 June 2017.

Ruwende said the performance shows the early fruits of the Group’s efforts to rebuild its position in the market.

The Group’s balance sheet grew by 6 percent due to an increase in debtors arising from recognition of sales of residential stands, and organic growth of the micro-finance loan book.

Insurance receipts also contributed to growth in cash and cash equivalents.

Growth was countered by a decline in the value of the equities book which reduced by 12 percent.

The Group closed with total assets of US$127m at 30 June 2018, up from US$120m at 31 December 2017.

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