DIVERSIFIED firm, Zimre Holdings Limited (ZHL) has overturned a near $1,6 billion loss to a profit after tax of $9,03 billion in the half-year ended June 30, 2022, owing to fair value gains on financial assets and investment properties.
In the prior period, the company posted a loss of $1,58 billion owing mostly to the effects of an inflationary environment.
In a statement for the period under review, chairperson Desmond Matete said in inflation adjusted terms, total income for the group was $28,4 billion, an increase of 355% compared to prior period.
This was underpinned by positive investment returns propelled by fair value gains on investment properties.
“The group recorded a profit after tax of $9,0 billion compared to a loss after tax of $1,6 billion in the prior period. This was mainly attributable to fair value gains on financial assets and investment properties,” he said.
“The profit growth was above the inflation rate at 191%. While all key business operations achieved strong performance property management and development services, asset management, and microlending.
“Regionally, the group is restructuring its operations, enhancing competitive capital and extending its reach beyond the jurisdictions within which it operates,” Matete said.
“Inflation-adjusted gross premium written for the period under review was $6,4 billion, down 8% from $6,9 billion in the prior period. The inflationary pressures in Zimbabwe weighted down real business growth in the region,” Matete said.
“Domestic operations contributed 71% of the gross premium, with the balance coming from the regional operations. Inflation adjusted total claims and expenses for the period increased from $6,9 billion to $15,0 billion as a result of a high claims experience which saw net benefits and claims growing by 20%.”
He said total assets grew by 51% to $77,7 billion during the period under review while total equity grew from $24,6 billion to $35,9 billion as at June 30, 2022.
Driving this growth was an increase in investment properties to $49,61 billion, as a result of a fair value gain of $13,08 billion.
The increase in investment properties was nearly 71% higher than the 2021 comparative of $29,1 billion.
Going forward, Matete said Zimre’s eco-system was now in place, founded on the business triangle of cash, customer and change.
, the domestic reinsurance operations’ profitability was depressed due to high claims experienced mainly from the agricultural sector resulting in a combined ratio of 172%. Total comprehensive income was $11,4 billion compared to a loss of $1,2 billion in 2021.”
The fair value adjustment on investment property was recorded at $21,4 billion at the end of the period under review, from a loss of $676,91 million experienced in the comparative period. Zimre and its subsidiaries are into the provision of life assurance, non-life insurance (general insurance, reinsurance, healthcare, funeral assurance),