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Britam Half Year 2017 Pre-Tax Profit Drops By 55.4%
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Ericsson
#1 Posted : Thursday, August 24, 2017 11:35:27 AM
Rank: Elder


Joined: 12/4/2009
Posts: 10,639
Location: NAIROBI
--Pre Tax Profit declined by 55.4% to Sh 1.3 Billion from Sh 2.9 Billion as of June 2016 even as total income increased by 16% to Sh 14.7 Billion compared to Sh 12.7 Billion in the same period last year.

--The increase on total income was on the back of increased gains on financial assets at fair value through profit or loss, amounting to Sh 1.1 Billion.

--The company’s core insurance business which accounts for nearly 70% of its total revenues, reported a revenue growth of 10% to Sh 9.7 Billion from Sh 8.9 Billion in 2016.

--Gross earned premiums and fund management fees increased by 6.2% to Sh 11.7 Billion as net earned revenue increased by 8.8% to Sh 10.2 Billion.
--Investment income (Dividends & interests) increased by 15% to Sh 2.5 Billion·

--Net insurance benefits were up 85% to Sh 6.7 Billion due to a change in the valuation methodology which came into effect in January 2016.
Total expenses increased by 33% to Sh 13.5 Billion mainly as a result of increased net insurance benefits.

Earnings Per Share (EPS) declined by 45% to Sh 0.51 from Sh 0.92.
The company did not recommend payment of interim dividend
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Pesa Nane
#2 Posted : Thursday, August 24, 2017 12:28:21 PM
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Out goes Muthaura, in comes Hollas

Pesa Nane plans to be shilingi when he grows up.
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mulla
#3 Posted : Thursday, August 24, 2017 12:29:45 PM
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On the back of these results, I wish counter come back down to 10/= so that I average down my buy price and hold long term.
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Angelica _ann
#4 Posted : Thursday, August 24, 2017 12:42:08 PM
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Pesa Nane wrote:
Out goes Muthaura, in comes Hollas



You write to the son that the father has retired smile
In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
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Pesa Nane
#5 Posted : Thursday, August 24, 2017 1:11:44 PM
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Consolidated Income
Pesa Nane plans to be shilingi when he grows up.
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obiero
#6 Posted : Thursday, August 24, 2017 1:12:53 PM
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Angelica _ann wrote:
Pesa Nane wrote:
Out goes Muthaura, in comes Hollas



You write to the son that the father has retired smile

Hehe. Only a woman can notice that.. Meanwhile this company doesn't tickle my fancy

HF 30,000 ABP 3.49; KQ 414,100 ABP 7.92; MTN 15,750 ABP 6.45
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Pesa Nane
#7 Posted : Thursday, August 24, 2017 1:13:43 PM
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Comprehensive Income
Pesa Nane plans to be shilingi when he grows up.
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Ericsson
#8 Posted : Friday, August 25, 2017 8:50:59 AM
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Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Spikes
#9 Posted : Friday, August 25, 2017 9:28:10 AM
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Joined: 9/20/2015
Posts: 2,811
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Pesa Nane wrote:
Out goes Muthaura, in comes Hollas



Muthaura going out is a strategy to keep the price of this stock high....but Wanjiku is smart the stock will come down. ....I don't know the reputation of Hollas. ...please share info....
John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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actuarywahisa
#10 Posted : Friday, August 25, 2017 9:38:03 AM
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Joined: 5/21/2014
Posts: 184
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


CIC in the short term.

Meanwhile hiyo math yako ya 55% drop in EPS. Indeed the world is made up of 3 people; Those who can count and those who can't count.
There are too many opportunities all around. Open your eyes and maybe you'll spot one
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Ericsson
#11 Posted : Friday, August 25, 2017 10:05:11 AM
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Joined: 12/4/2009
Posts: 10,639
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actuarywahisa wrote:
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


CIC in the short term.

Meanwhile hiyo math yako ya 55% drop in EPS. Indeed the world is made up of 3 people; Those who can count and those who can't count.

Corrected drop in EPS is 45%.
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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wukan
#12 Posted : Friday, August 25, 2017 10:20:52 AM
Rank: Veteran


Joined: 11/13/2015
Posts: 1,569
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


The size of the portfolio is what matters. When the pool fund is small then investing in equities make sense but as the size of the fund increases equities bring wild swings. Real estate comes in to stabilize. Britam lost good fund managers and has become more conservative. Cic insurance has good fund managers for the size of the their portfolio. Who emerges the winner will depend on how the economy evolves. Unless you are doing active management (buy low sell high) equities as an asset class in Kenya have not done that well over the last 50 years in terms of capital appreciation, yields and liquidity when compared to real estate.
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Ericsson
#13 Posted : Friday, August 25, 2017 10:27:05 AM
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Posts: 10,639
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wukan wrote:
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


The size of the portfolio is what matters. When the pool fund is small then investing in equities make sense but as the size of the fund increases equities bring wild swings. Real estate comes in to stabilize. Britam lost good fund managers and has become more conservative. Cic insurance has good fund managers for the size of the their portfolio. Who emerges the winner will depend on how the economy evolves. Unless you are doing active management (buy low sell high) equities as an asset class in Kenya have not done that well over the last 50 years in terms of capital appreciation, yields and liquidity when compared to real estate.


In terms of capital appreciation equities do better than real estate in the long run even in kenya ceteris paribas assuming economy is okay
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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wukan
#14 Posted : Friday, August 25, 2017 10:51:24 AM
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Joined: 11/13/2015
Posts: 1,569
Ericsson wrote:
wukan wrote:
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


The size of the portfolio is what matters. When the pool fund is small then investing in equities make sense but as the size of the fund increases equities bring wild swings. Real estate comes in to stabilize. Britam lost good fund managers and has become more conservative. Cic insurance has good fund managers for the size of the their portfolio. Who emerges the winner will depend on how the economy evolves. Unless you are doing active management (buy low sell high) equities as an asset class in Kenya have not done that well over the last 50 years in terms of capital appreciation, yields and liquidity when compared to real estate.


In terms of capital appreciation equities do better than real estate in the long run even in kenya ceteris paribas assuming economy is okay


Yes ideally in the long run equities should do well. But the market can remain irrational more than the insurance firm can remain solvent. Rufus Mwanyasi had done an article on the risk of buy and hold.
Quote:
Consider averages of the investment period dating back to 1999. Over 17 years equity investors earned a yearly average of 3.27%. During this period, 5-year rolling returns showed no returns above 10% (commonly used benchmark return for long-term stock investments) except in the periods ending in 2005 and 2006. Even with these outperforming years, someone might argue as representing periods of irrational exuberance.10-year rolling returns had only the period ending in 2010 with a return above 10%.Think about that. Buy-and-hold fell flat on its face. Obviously, no investor would want such low returns.
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Ericsson
#15 Posted : Friday, August 25, 2017 10:58:54 AM
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Joined: 12/4/2009
Posts: 10,639
Location: NAIROBI
wukan wrote:
Ericsson wrote:
wukan wrote:
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


The size of the portfolio is what matters. When the pool fund is small then investing in equities make sense but as the size of the fund increases equities bring wild swings. Real estate comes in to stabilize. Britam lost good fund managers and has become more conservative. Cic insurance has good fund managers for the size of the their portfolio. Who emerges the winner will depend on how the economy evolves. Unless you are doing active management (buy low sell high) equities as an asset class in Kenya have not done that well over the last 50 years in terms of capital appreciation, yields and liquidity when compared to real estate.


In terms of capital appreciation equities do better than real estate in the long run even in kenya ceteris paribas assuming economy is okay


Yes ideally in the long run equities should do well. But the market can remain irrational more than the insurance firm can remain solvent. Rufus Mwanyasi had done an article on the risk of buy and hold.
Quote:
Consider averages of the investment period dating back to 1999. Over 17 years equity investors earned a yearly average of 3.27%. During this period, 5-year rolling returns showed no returns above 10% (commonly used benchmark return for long-term stock investments) except in the periods ending in 2005 and 2006. Even with these outperforming years, someone might argue as representing periods of irrational exuberance.10-year rolling returns had only the period ending in 2010 with a return above 10%.Think about that. Buy-and-hold fell flat on its face. Obviously, no investor would want such low returns.



That Rufus Mwanyasi article seems vague.Can he give us a sample of a listed equity he used.
If in my case I take an example of a company that was listed in 1999;KCB or Stanchart or EABL or NMG the capital appreciation/mkt cap has been more than 100 times.
Give me a property that has that appreciation.
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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wukan
#16 Posted : Friday, August 25, 2017 11:32:55 AM
Rank: Veteran


Joined: 11/13/2015
Posts: 1,569
Ericsson wrote:
wukan wrote:
Ericsson wrote:
wukan wrote:
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


The size of the portfolio is what matters. When the pool fund is small then investing in equities make sense but as the size of the fund increases equities bring wild swings. Real estate comes in to stabilize. Britam lost good fund managers and has become more conservative. Cic insurance has good fund managers for the size of the their portfolio. Who emerges the winner will depend on how the economy evolves. Unless you are doing active management (buy low sell high) equities as an asset class in Kenya have not done that well over the last 50 years in terms of capital appreciation, yields and liquidity when compared to real estate.


In terms of capital appreciation equities do better than real estate in the long run even in kenya ceteris paribas assuming economy is okay


Yes ideally in the long run equities should do well. But the market can remain irrational more than the insurance firm can remain solvent. Rufus Mwanyasi had done an article on the risk of buy and hold.
Quote:
Consider averages of the investment period dating back to 1999. Over 17 years equity investors earned a yearly average of 3.27%. During this period, 5-year rolling returns showed no returns above 10% (commonly used benchmark return for long-term stock investments) except in the periods ending in 2005 and 2006. Even with these outperforming years, someone might argue as representing periods of irrational exuberance.10-year rolling returns had only the period ending in 2010 with a return above 10%.Think about that. Buy-and-hold fell flat on its face. Obviously, no investor would want such low returns.



That Rufus Mwanyasi article seems vague.Can he give us a sample of a listed equity he used.
If in my case I take an example of a company that was listed in 1999;KCB or Stanchart or EABL or NMG the capital appreciation/mkt cap has been more than 100 times.
Give me a property that has that appreciation.


For that we have to look at Unit trust-equities which of them has performed well? Taking individual listed companies is like taking an acre of land in Ruaka in 1999 used to sell for around 800k now that same acre is 80m
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lochaz-index
#17 Posted : Friday, August 25, 2017 11:58:18 AM
Rank: Veteran


Joined: 9/18/2014
Posts: 1,127
Ericsson wrote:
wukan wrote:
Ericsson wrote:
Britam says they want to diversify into property and real estate development,move away from equities and stock market.
CIC insurance is meanwhile investing in the equities and stock market to boost income and profits.
Who will emerge biggest gainer among the two?


The size of the portfolio is what matters. When the pool fund is small then investing in equities make sense but as the size of the fund increases equities bring wild swings. Real estate comes in to stabilize. Britam lost good fund managers and has become more conservative. Cic insurance has good fund managers for the size of the their portfolio. Who emerges the winner will depend on how the economy evolves. Unless you are doing active management (buy low sell high) equities as an asset class in Kenya have not done that well over the last 50 years in terms of capital appreciation, yields and liquidity when compared to real estate.


In terms of capital appreciation equities do better than real estate in the long run even in kenya ceteris paribas assuming economy is okay

The last 10 - maybe even 15 - years in KE or any Sub-Saharan country for that matter have been an exception to that rule. Real estate has handed equities a serious beat down in that time frame.
The main purpose of the stock market is to make fools of as many people as possible.
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Ericsson
#18 Posted : Saturday, August 26, 2017 7:39:21 AM
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Joined: 12/4/2009
Posts: 10,639
Location: NAIROBI
Link to the Britam HY 2017 results

https://www.britam.com/d...9-4290-bc49-cd58742cfa0e
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Pesa Nane
#19 Posted : Friday, September 15, 2017 10:24:54 PM
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Joined: 5/25/2012
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Pesa Nane plans to be shilingi when he grows up.
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Pesa Nane
#20 Posted : Friday, September 15, 2017 10:27:51 PM
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Pesa Nane plans to be shilingi when he grows up.
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