By Cowry Asset
Few days ago, AIICO Insurance released its half-year earnings, recording an impressive performance in the period under review.
AIICO, which is one of the companies to reckon with in the insurance sector in Nigeria, recorded a 30 percent boost in its top line on the back of a 50 percent growth in its life business to N11.70 billion with fees and commission income increasing by 27.28 percent to N1.54 billion.
However, these were offset majorly by higher claims expense (+54 percent to N14.2 billion) – claims ratio remained higher than industry average of – 44.30 percent – which contributed to an underwriting loss of N0.59 billion and moderated its insurance margin to 42.76 percent (from 42.95 percent in H1 2017).
Nevertheless, AIICO’s investment yield of 8.58 percent (higher than 6.34 percent in H1 2017), which resulted from a 50.58 percent increase in investment income to N6.75 billion, beat industry average of 5.17 percent while return on investment towered at 17.95 percent (above industry average of 4.88 percent).
Going forward, we expect AIICO insurance to improve on its performance track record and given its precedence, we anticipate at least a repeat of its historical cash dividend payout of N0.05 for the FY
2018 financial year and this is expected to yield around 10 percent to discerning investors.
Meanwhile, AIICO has received a BUY rating with a target price of N2.04k per share. As at the close of business on Friday, the firm was trading 68 kobo per share at the stock exchange.
more recommended stories
Zedcrest Capital’s Amzat, Others to Speak at Lagos FINTECH Week
Group Managing Director of Zedcrest Capital.
Buhari to Empower 10m Traders, Farmers During Second Term
By Modupe Gbadeyanka No fewer than.
Africa Prudential Considers New Ventures to Improve Earnings
By Modupe Gbadeyanka Managing Director/CEO of.
Team Ren Excalibur Wins Renmoney’s Hackathon
By Modupe Gbadeyanka One of Nigeria’s.
Unilever Nigeria Revenue Drops to N19bn in Q1 2019
By Dipo Olowookere Lagos-based Fast-Moving Consumer.
Nigeria Still Safe to Borrow Additional N7.9trn—FSDH
By Dipo Olowookere Some days ago,.
Nigerian Firm Tops Seeds Index Ranking
A company based in Nigeria known.
FG Picks 13 Banks to Sell First N20bn 30-Year Bond to Investors
By Dipo Olowookere A total of.