CBL Corporation has reported a first half profit jump of 44% in its first results since listing on the New Zealand and Australian stock exchanges in October 2015.
The specialist insurance company reported an operating profit of $35.1 million on gross written premiums (GWP) of $179.2 million, up 45% and up 43% respectively when c ompared to the first half of 2015.
Net profit after tax (NPAT), which excluded foreign currency translation adjustments, was up 33% to $21.8 million.
CBL said growth was particularly strong in CBL’s Dublin-based subsidiary CBL Insurance Europe, where operating profit jumped from $0.1 million to $1.6 million, and in the NZ-headquartered CBL Insurance.
Managing director Peter Harris
said the stability of CBL’s combined ratio showed that the company’s growth was strong and sustainable and proved it was well on track to meet its full year profit targets.
He said the results continued a string of good news for CBL.
“Since listing, we have paid a maiden dividend of 4.5 cents per share for the 2015 year, comfortably outperformed our IPO forecasts; successfully integrated new acquisitions in Australia, Britain and Mexico; and had our financial strength rating upgraded to A- (Excellent) by international ratings agency AM Best,” Harris said.
Looking ahead, he said there were strong growth opportunities existing in several overseas markets, particularly Europe, Australia and South-East Asia.
“We have invested considerable resources over the past six to nine months into developing several new programs that we expect will generate additional future long term sustainable revenue and profit. We will begin introducing these later this year, and aim to roll them out more broadly in 2017.”
Harris said CBL’s planned acquisition of Securities and Financial Solutions Europe SA, France’s largest specialist producer of construction-sector insurance and CBL’s largest single client, was tracking well and expected to conclude by early 2017.
There were also some interesting possibilities coming out of Britain’s decision to leave the EU.
“Some of our British competitors appeared to have been caught out by the success of the Leave campaign; CBL’s well-established presence in Europe gives us a considerable advantage should British banks and insurers need to meet stricter licensing criteria in the future,” Harris said.
He said that while CBL had delayed investing in Euro-denominated investments in the lead-up to the Brexit referendum, it continued to look for investment opportunities that would boost the company’s bottom line without materially affecting its solvency margins.
“However, a disciplined underwriting approach and a focus on claims and cost containment remain central to CBL’s strategy for revenue and profit growth across all its business operations.”
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