UAP Holdings (UAPH) has reported a first half net loss of Kshs 305 million having plunged from a profit of Kshs 383 million during a similar period last year which is attributed to poor performance at the Nairobi Securities Exchange (NSE).
The firm has said investment income was down 34% driven by fair value losses of 771 million shillings on equity investments during the period compared to fair value gains of 407 million shillings during a corresponding period in 2019.
The Group CEO, Arthur Oginga, during the Investor briefing said “We continue to drive our profitable growth agenda ensuring that business is transparently and appropriately priced for the risk underwritten, including rewarding good risk.
Partially as a result of these and other management initiatives to reduce cost of claims through supplier management, early settlement discounts etc, net claims reduced by 11.8% compared to H1 2019. The business also benefited from a reduced number and severity of claims incidents following the government-imposed lockdowns and curfews in quarter two.”
According to the firm the NSE All Share Index was down 17.2% during the first six months of this year compared to an increase of 6.5 percent during a similar period in 2019.
The firm says this was driven by reduced investor appetite for equities on the back of the COVID-19 pandemic.
“We continue to execute on our integrated financial services strategy supported by digital with a keen focus on profitable growth. Our business is resilient with a strong balance sheet and improved cash generation. This will position us well to navigate the headwinds that the COVID-19 pandemic shall present in the second half of the year. We remain cautious given that the pandemic is still unfolding and have put in place measures to ensure our customers continue to receive services seamlessly” Arthur said.
Overall UAP Holdings saw a double digit increase in gross written premiums at 11% driven by core short-term insurance businesses, which reverses the previous trend of declining to flat growth experienced in recent years.