Financial Commentary
Inflation adjusted revenue analysis
Gross Premium Written (“GPW”) at $3.5 billion was 13% below prior year in inflation adjusted terms due to below inflation revisions of sums insured particularly for the short-term insurance and life assurance subsidiaries.
Total income was 14% higher than the prior year reflecting fair value gains on investment properties and positive returns on listed equity investments.
Historical financial performance analysis
GPW at $2.1 billion was 638% higher than prior year but lower than average year on year inflation rate of 693%. The increase was primarily due to organic growth, an upward review of sums insured, as well as a weakening of the Zimbabwe dollar (“ZWL”) against the United States of America dollar (“USD”). The Botswana based reinsurance subsidiary also made a material contribution to the results.
Rental income increased by 595% from prior year largely due to quarterly rental reviews introduced in 2019 coupled with improvements in the occupancy rates from 75.36% in 2019 to 87.91%.
Administration expenses increased by 610% in line with the prevailing inflationary environment. The growth rate was, however, lower than the average year on year reported inflation for the period.
Total assets increased by 476% due to revaluation of investment property, fair value gains on equity investments, revaluation gains on USD denominated assets and the profit the period. The growth was ahead of the consumer price index (“CPI”) movement of 291% from December 2019 to September 2020.
Impact of Coronavirus pandemic
To date, the Group has not been significantly negatively impacted by the pandemic with outturns in line with our expectations. We will continue to monitor the situation and make every effort to ensure all stakeholders are protected from the pandemic.
