First Mutual profit for four months falls 75 percent

via First Mutual profit for four months falls 75 pct, targets $100 mln annual revenue | The Source on June 3, 2014

First Mutual Holdings Limited’s profit after tax plummeted by 75 percent to $1,1 million in the four months to April, from $4,4 million compared to last year, reflecting a depressed market, the group’s chief executive Douglas Hoto said on Tuesday.

“From the operations of the business, the business is going forward but the market has not been very good. We hope that as we navigate the year it might improve but we are not taking that as part of our main plans,” Hoto told a shareholder meeting.

Gross premium income was up 14 percent to $37,8 million during the period under review compared to $31,5 million last year, with income from commissions growing similarly.

“We are aiming to reach at least $100 million per year,” Hoto said, adding that the business was profitable.

Retrocessions – the insurance cover that reinsurers take on the international market – were down to $2,8 million from $4 million last year, “signifying more retention of business internally and also the timing of some of the insurance contracts.”

Net written premium was 20 percent up to $35 million.

Claims were up 30 percent to $21 million, with net revenue rising 20 percent, which Hoto attributed to higher claims early in the year.

“The beginning of the year there are much higher claims but towards the end of the year they will even out,” said Hoto.