Jubilee Holdings half-year profit jumps 146 per cent
Jubilee Holdings Limited Chairman Nizar Juma (centre), regional chief executive officer Julius Kipngetich (left) and Juan Cascarra, the chief operating officer, during the release of the firm’s half-year financial results at the Jubilee Insurance House, Nairobi.
Jubilee Holdings half-year net profits grew almost three-fold to Sh4.5 billion from Sh1.8 billion after cashing in on the first tranche of the sale of its stake to Allianz in May this year.
The insurance firm said it had received Sh2.07 billion as part of the proceeds from the sale, which it expects to close by the end of the year.
The sale boosted its overall business performance whose gross profits grew from Sh2.3 billion to Sh3.1 billion in the period under review.
The firm will pay shareholders Sh72.4 million in interim dividend similar to the amount paid out to shareholders in a similar period last year.
Jubilee has since listing on the Nairobi Securities Exchange in 1984 consistently paid dividends—either growing or maintaining the same level year-on-year.
“Results were driven by robust operating performance across all business segments. Jubilee registered an initial gain of Sh2.07 billion from the sale of 66 percent of its Kenyan general business to Allianz group,” Jubilee chairman Nizar Juma said.
Mr Juma said they expected to get subsequent tranches from the proceeds of the Kenyan deal to tap Sh3 billion at the end of the year.
This is the first of several similar regional transactions.
The Nairobi Securities Exchange-listed insurer signed an agreement to sell stakes ranging from 51 percent to Sh66 percent in its general insurance subsidiaries in Kenya, Tanzania, Uganda, Burundi and Mauritius for a total of Sh10.8 billion.
The company also expects to close transactions with Allianz in its other markets by the end of the year pending regulatory approvals.
Mr Juma said they hope to close the Ugandan and Burundi sale in October, Tanzania in November and Mauritius in December.
“These transactions are currently undergoing regulatory approvals in the groups other markets with Uganda poised to be completed next and the remaining markets by the end of 2021,” he said.
The deal is Allianz’s second direct investment in the country, after establishing Allianz Insurance Company of Kenya Limited as a greenfield operation in 2014.
Jubilee will receive Sh7.75 billion in the deals with Allianz while Sh3 billion will be invested in the operating businesses in Kenya, Uganda, Tanzania, Burundi and Mauritius.
The windfall comes as Jubilee performance picked up growing written premiums 10 percent from Sh20.2 billion in the first half of last year to Sh22.2 billion.
Its profits from associate business were up from Sh303 million to Sh886 million on higher incomes from Bujagali power in Uganda after getting additional shareholding in June last year.
This saw its assets grow eight percent to Sh152 billion from Sh140.1 billion last year as the insurer sets sights on growing regional presence.
The company share price gained 45 percent during the period to Sh351 billion pushing market capitalisation from Sh17.5 billion to Sh25.4 billion.
