7/29/2019 ZIMR Unaudited results for HY ended 30 Jun 13.pdf

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Security, Growth and Profitability

NAUDITED ABRIDGED FINANCIAL STATEMENTSFOR THE HALF YEAR ENDED 30 JUNE 2013

AIRMAN'S STATEMENT FOR THE HALF YEAR ENDED

JUNE 2013NANCIAL HIGHLIGHTSe Group profitability improved significantly in the first half of 2013 whenmpared to the same period last year. The operating profit for the periods US$1,6 million compared to a loss of US$1,1 million recorded in 2012.

ERATING ENVIRONMENTmbabwe witnessed a slowdown in economic output in the first half of the

r 2013, resulting in the downward revision of the GDP growth forecast2013 from the original 5% to 3,4%. Liquidity constraints remained a big

llenge for businesses.

ere was a noticeable improvement in the Malawi economy as policyorms instituted to revive and stabilize the economy began to bear fruit.s was evidenced by the stabilization of the US Dollar/Malawi Kwachahange rate, the easing of fuel shortages and slowing down of inflation.

e inflation ended the half year at 27, 9% from 35% in January 2013.

onomic growth prospects in South Africa are being adversely affected byour unrest and Euro crisis resulting in moderate growth rates of below 3%d also the further weakening of the Rand against the US dollar.e liquidity position of most insurance companies is under pressureulting mainly from the high levels of premium debtors precipitated by theht liquidity situation in the market.

OUP PERFORMANCE REVIEWe majority of the Group operations performed well in the first half of 2013,pite the difficult operating environment. There was a marked

provement in profitability in the first half when compared to the sameiod last year.

al revenue for the group of US$24,7 million was 4% below same periodyear mainly as a result of Gross Premium Written for the Group that was

% below last year. The devaluation of the Malawi Kwacha coupled with aiberate effort to write only collectable and profitable business contributedthis decline in revenue in US dollar terms. However profit before Tax

proved from a loss of US$1,4 million in 2012 to a profit of US$2,3 million inperiod under review. Total Comprehensive Income recorded in 2013 was

$0,7 million compared to a loss of US$3 million in the same period lastr.

thareholders' Funds were at $47,5 million as at 30 June 2013. Total assetsw by 4% from US$118,1 million in December 2012 to US$123 million atend of the half year.

CTOR PERFORMANCE REVIEWINSURANCE

e Short Term Reinsurance Sector recorded a Gross Premium Income of $19,8m compared to US$22,4 million in the comparative period last year.e apparent decline was mainly due to selective underwriting to reduceosure in high risk businesses. The sector recorded an operating loss of $0,3 million compared to a loss of US$1,9 million in 2012.

ASSURANCEe Life Reassurance operations recorded a commendable top line growth of % from US$1,8 million in 2012 to US$2,3 million in 2013. The profitabilityhe Sector was affected by high claims experience during the period underiew.

NERAL INSURANCE

oss Premium Written in 2013 was US$5,4 million compared to US$7,8lion in the same period last year. The decline in revenue in dollar termss a result of the Malawi Kwacha devaluation. Operating Profit improvedm a loss of US$0,59 million in 2012 to a profit of US$0.28 million in 2013.

OPERTYal Revenue achieved in the period under review was US$2,6 million

mpared to US$2,3 million recorded in 2012, a growth of 14%. Operating Profits US$1,6 million against US$1,5 million in 2012, a growth of 5%.

al Revenue achieved in the period under review was US$2,6 millionmpared to US$2,3 million recorded in 2012, a growth of 14%. Operating Profit

s US$1,6 million against US$1,5 million in 2012, a growth of 5%.

SURANCE BROKINGal Revenue achieved by the sector remained at US$0,8 million and a breakevensition in terms of profitability.

RECTORATEssrs Ignatius Mvere, Selby Hwacha and Rongai Chizema were appointed to

stBoard with effect from 1 April 2013. I look forward to their invaluabletributions in taking Group performance to a higher level.

VIDENDinterim dividend is proposed in view of the need to utilize cash for

iness growth.

UTLOOKe Group will continue to scout for business opportunities in the emergingerating environment and we are confident of future prospects.e Group strategic priorities remain the consolidation and strengthening of sting operations and implementation of the necessary measures to enhancefitability and cash generation in the prevailing tight liquidity environmentorder to deliver sustainable value to our shareholders and other

keholders.

PRECIATION

behalf of the Board and shareholders, I would like to express myreciation to all stakeholder groups, Group Boards, management and staff

oughout the Group, for their commitment and support in the period

der review.

N KumaloAIRMAN

h September 2013

Registered Office9th Floor, Zimre CentreCnr Leopold Takawira / Kwame Nk rumah Ave.HARAREZimbabwe

Directors: B.N Kumalo, I Mvere, J M Matiza, J Maguranyanga, E Zvandasara, R Chizema, S V Hwacha, A J Nduna*, S Tembo*, T Nyika* *Executive

Notes 2013 2012

US$ US$

Gross premium 26,736,438 32,074,926Premium ceded (5,729,596) (6,991,965)Net premium written 21,006,842 25,082,961Unearned premium provision (2,579,653) (4,564,229)Earned premium 18,427,189 20,518,732

Brokerage commission and fees 2,886,526 2,448,935Total insurance revenue 21,313,715 22,967,667

Rental revenue 1,875,608 1,732,000Net revenue from sale of inventory property 705,606 352,919Net property operating costs (178,584) (93,148)Investment revenue 918,802 809,705Other revenue 110,285 64,958

Total revenue 24,745,431 25,834,102

Total claims and expenses (23,122,454) (26,936,460)Net benefits and claims (6,961,349) (8,566,190)Commission and acquisition expenses

6

8

9

7

(5,992,425) (7,023,060)Operating and administrative expenses (10,168,680) (11,347,210)

Operating (loss)profit/ 1,622,977 (1,102,358)

Other gains/(losses) 526,533 (4,304)Finance costs (196,330) (216,052)

Profit /(loss) before share of associates 1,953,181 (1,322,714)

Share of associates' net profit/ (loss) 334,646 (92,041)

Profit /(loss) before tax 2,287,826 (1,414,755)

Income tax expense (726,415) (18,914)

Profit /(loss) for the period 1,561,412 (1,433,669)

Other comprehensive incomeItems that will not be reclassified to profit or lossShare of other comprehensive income of associates (177,128) -

Items that may be reclassified subsequently to profit or lossExchange d ifferences on t ransla ting foreign opera tions (579,614) (1,225,593)Investments in equity instruments (68,302) (417,272)Income tax relating to other comprehensive income 4,616 82,357

(643,300) (1,560,508)

Other comprehensive income for the period net of tax (820,428) (1,560,508)

TOTA L COM PRE HE NSI VE I NCO ME F OR THE PE RI OD 74 0, 98 3 (2 ,994 ,176 )

Consolidated statement of comprehensive incomefor the 6 months ended 30 June 2013

Profit/ (Loss) attributable to:Owners of the parent 849,901 (2,148,114)Non-controlling interests 711,510 714,446

1 ,5 61 ,4 12 ( 1, 43 3, 66 9)

Total comprehensive income attributable to:Owners of the parent 44,222 (3,592,723)Non-controlling interest 696,762 598,547

7 40 ,9 83 ( 2, 99 4, 17 6)

Basic earnings per share (in cents): 0.11 (0.28)Headline earnings per share(in cents): 0.11 (0.28)

Number of shares for basic EPS 774,846,940 774,846,940

Cash flows from operating activities

Cash generat ed from operations

Interest paidIncome taxes paid

Net cash generated from operating activities

Cash flows from investing activities

Net cash inflow/(outflow) from/(to)investing activities

Cash flows from financing activities

Net cash inflow /(outflow) from/(to) financing activities

Net increase/ (decrease) in cash and cash equivalentsCash and cash equivalents at beginning of yearCash and cash equivalents as previously reportedEffect of exchange rate movementsCash and cash equivalents at end of period restated

Consolidated statement of cash flowsfor the 6 months ended 30 June 2013 2013

US$

2,082,795

(189,803)(526,733)

1,366,259

1,148,572

564,101

3,078,9319,019,389

12,098,321(490,334)

11,607,987

2012

US$

3,655,617

(222,569)(416,286)

3,016,762

(1,971,335)

(1,052,247)

(6,820)10,933,62210,926,802(1,257,286)9,669,517

Notes 30-Jun 2013 31 -Dec 2012ASSETS US$ US$

Non-current assets 73,775,383Intangible assets 975Property, plant and equipment 4,498,942Investment properties 49,137,476Investment in associates 17,180,703Investments in equity instruments 2,822,152Deferred tax asset 135,135

Current assets 44,372,909Trade and other receivables 21,030,341

Inventory 5,276,084Deferred acquisition costs 3,252,276Short-term investments 5,794,820Cash and cash equivalents 9,019,389

TOTAL ASSETS 118,148,292

EQUITY AND LIABILITIES

Equity attributable to owners of the parent 47,429,658Share capital 7,748,469Share premium 5,181,829Other capital reserves 29,907,200Revaluation reserve 2,914,649Mark-to-market reseve 2,083,997Foreign currency translation reserve (3,741,892)Retained earnings 3,335,405

Non-controlling interest 26,818,638

TOTAL EQUITY 74,248,296

Non-current liabilities 4,419,369Deferred Tax 1,405,003

Life fund 3,014,366

Current liabilities 39,480,627Trade and other payables 15,999,250Short-term borrowings 1,912,924Insurance & other provisions 21,568,453

TOTAL EQUITY AND LIABILITIES 118,148,292

Consolidated statement of financial positionas at 30 June 2013

74,957,5346,362

4,512,30349,352,03217,404,4353,682,402

-

48,033,86322,032,662

5,609,1994,290,1664,493,849

11,607,987

122,991,397

47,473,8807,748,4695,181,829

29,907,2002,914,6501,843,183

(4,306,758)4,185,306

27,951,168

75,425,048

5,259,8632,153,622

3,106,241

42,306,48616,409,3962,454,024

23,443,065

122,991,397

1. Corporate information

2. Basis of preparation

3. Currency

4. Accounting policies

5. Exchange rates

6. Operating and administration expenses include: 30-Jun-12

Allowance for credit losses and bad debts expense 3,210,001Depreciation and armotisation 366,017

7. Insurance & Other provisions 31-Dec-12

Provision for reported claims 6,613,993

Provision for incurred but not reported claims 2,339,194Unearned premium provision 11,583,928Other 1,031,338

21,568,453

8. Investments in equity instruments 31-Dec-12

Listed investments in equity instruments at fair value 1,926,224Unlisted investments in equity instruments at cost -Unlisted investments in equity instruments at fair value 895,928

2,822,152

9. Short-term investments 31-Dec-12

Listed equity investments at fair value through profit & loss 1,652,654Government securities held to maturity 30,581Deposits with financial institutions held to maturity 4,111,584

5,794,820

10. Segment results30-Jun-13 30-Jun-12 30-Jun-13 30-Jun-12

Reinsurance 16,167,284 16,525,009 310,391 (1,938,087)Reassurance 1,902,562 1,557,340 (110,781) 37,718General insurance 3,470,773 4,880,410 279,954 (588,489)

Property 2,587,088 2,260,122 1,580,780 1,501,248Broking & adjustments 617,724 611,220 (437,368) (114,748)

24,745,431 25,834,102 1,622,977 (1,102,358)

11. Geographical information Revenue Operating profit

Zimre Holdings Limited is a holding company of companies in general insurance, reinsurance, property, andinsurance and reinsurance broking. The company is domiciled in Zimbabwe.

The financial information has been prepared in accordance with IAS34 - Interim Financial Reporting Standard.

The financial statements are presented in United States Dollars which is the functional and reportingcurrency of the company.

The Group accounting policies have been applied consistently for the period and are the same as thoseapplied in prior year financial statements.

The Group uses market exchange rates obtainable in the markets in which it operates to translate financialstatements of the foreign entities to the Group reporting currency.

Revenue Operating profit

Zimbabwe 13,259,779 12,894,908 1,672,198 (2,150,196)Malawi 5,957,258 7,366,999 579,727 (334,404)Zambia 1,714,152 2,583,254 (400,712) 741,949Mozambique 3,233,878 2,490,355 192,869 820,069Botswana 516,416 409,385 (270,312) (293,150)South Africa 63,948 89,201 (150,793) 113,373

24,745,431 25,834,102 1,622,977 (1,102,358)

for the 6 months ended 30 June 2013Notes to the Consolidated Financial Results

30-Jun-13

6,099,130

1,996,32814,260,8481,086,759

23,443,065

30-Jun-13

2,677,19967,008

938,1953,682,402

30-Jun-13

2,849,851-

1,643,9984,493,849

Share capitalSharepremium

Other capitalreserves

Revaluationsurplus

Mark-to-marketreseve

Foreigncurrencytranslationreserve

Retainedearnings

TotalNon-controllinginterests

B al an ce a t 01 J an ua ry 20 13 7, 748, 469 5, 181, 829 29, 907, 200 2, 914, 650 2, 083, 997 ( 3,7 41 ,8 92 ) 3, 33 5, 40 5 47, 429 ,6 59 2 6, 81 8, 63 8

Profit after tax for the period 849,901 849,901 711,510

Other comprehensive income net of tax (240,814) (564,866) (805,680) (14,749)

Issue of shares - 600,217

Dividend paid (164,448)

Balance at 30 June 2013 7 ,7 48 ,4 69 5 ,1 81 ,8 29 2 9, 90 7, 20 0 2 ,9 14 ,6 50 1 ,8 43 ,1 83 ( 4, 30 6, 75 8) 4 ,1 85 ,3 06 4 7, 47 3, 88 0 2 7, 95 1, 16 8

Share capitalSharepremium

Other capitalreserves

Revaluationsurplus

Mark-to-marketreseve

Foreigncurrencytranslationreserve

Retainedearnings

TotalNon-controllinginterests

B al an ce a t 0 1 J an uar y 201 2 7, 67 4, 31 5 5, 16 2, 84 2 29, 90 7, 20 0 1, 07 1, 26 0 3, 162, 66 6 ( 1, 31 8, 94 2) 4, 489 ,490 50, 148, 83 1 2 4, 058 ,0 55

Profit after tax for the period (2,148,114) (2,148,114) 714,446

Other comprehensive income net of tax (396,408) ( 1,048,201) (1,444,609) (115,899)

Balance at 30 June 2012 7 ,6 74 ,3 15 5 ,1 62 ,8 42 2 9, 90 7, 20 0 1 ,0 71 ,2 60 2 ,7 66 ,2 58 ( 2, 36 7, 14 3) 2 ,3 41 ,3 76 4 6, 55 6, 10 8 2 4, 65 6, 60 2

Consolidated statement of changes in equityfor the 6 months ended 30 June 2013

Consolidated statement of changes in equityfor the 6 months ended 30 June 2012

Total equity

74,248,296

1,561,412

(820,428)

600,217

(164,448)

75,425,048

Totalequity

74,206,886

(1,433,669)

(1,560,508)

71,212,710

30-Jun-13

1,787,844338,616

s p i d e x m e d i a