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UAP-Old Mutual has posted a 101 per cent increase in net profit of Sh383 million for the six months ended June 30, compared to Sh190 million in a similar period in 2018.

Profit before tax for the period grew by 16.3 per cent to Sh517 million on June 30, from Sh445 million in a similar period in 2018.

Group Chief Executive Officer Paul Mwangi attributed the improved performance to steady growth in net earned a premium and robust savings in operating expenses which declined by 8 per cent year-on-year. During the period under review, the gross written premium increased to Sh9.91 billion from Sh9.74 billion in 2018.

Property evaluation

However, investment income during the period declined by 7.7 per cent mainly due to the impact of property valuation write-downs.

Speaking yesterday during an investors briefing in Nairobi, Mwangi said although the NSE 20 index on Nairobi Securities Exchange had negative returns for the period, the investment portfolio fared relatively well with the only adverse impact being from the property portfolio.

According to the financial results, 58 per cent of the total income was received from Kenya, 23 per cent came from Uganda, nine per cent South Sudan while Tanzania and Rwanda both returned four per cent.

UAP-Old Mutual Chairman Joe Wanjui said the cost reduction during the period was a result of payroll savings realised after the reorganisation in first half of 2018 in addition to concerted efforts to manage expenses group-wide.

He said the claims increased due to the operating environment particularly for the medical business and additional boost to reserves in the life business because of growth.

Continue to invest

The company, Wanjui added, will continue to invest in employees and technology to ensure that it meets stakeholder expectations, especially that of the customers. According to the results, the gross earned premium increased by 2.9 per cent from Sh8917 registered on June 30, 2018 to Sh9.178 billion during the period under review. 

The commissions earned declined from Sh397 million in 2019 from Sh388 million in June 2018.