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Old Mutual Zimbabwe makes a hefty $89 profit in six months

Old Mutual Zimbabwe group’s after tax profit jumped seven-fold to $89.4 million in the six months to June from $12.5 million in the comparable period last year mainly due to an increase in investment income from non-banking activities, chief executive Jonas Mushosho told analysts yesterday.

Investment income from non-banking activities jumped to $216.4 million from a loss of $24.4 million in the same period last year, attributable to gains in the equities market.

Banking interest and similar income increased by 4 percent to $46.5 million while non-interest income grew 12 percent to $30.9 million in the same period.

However, net earned premiums dropped slightly —  by one percent  — to $91 million from $91.8 million achieved in the same period in the previous year, on decreased life insurance revenue.

Life sales declined by 5 percent to $10.4 million while non-life sales rose 3 percent to $153.5 million in the same period.

Total revenue increased by 175 percent to $384 million from $139.8 million reported in the same period last year.

Finance director, Takura Mudekunye said the group’s adjusted operating profit before tax increased by 11 percent to $36.8 million from $33.1 million in the comparable period last year, driven by life assurance and asset management profits.

The group’s funds under management increased by 31 percent to $2.1 billion in the period , attributable to a surge in equities.

“Funds under management grew by 31 percent, largely driven by the increase in equity prices and also strong net client cash flows,” Mushosho said.

The group’s loans and advances increased by 11 percent to $617.5 million.

The amount of treasury bills (TBs) that the group holds increased by 61 percent from $88.9 million in the same period  last year to $143.4 million.

Mushosho said the SME centre is now 50 percent complete and is expected to be commissioned in the first half of next year.

The group’s total assets increased to $2.39 billion from $2.16 billion previously, on the back of a an  increase in investments and securities.

Mushosho said the Kupinga Hydroelectric project in Chipinge, which was funded by Old Mutual, was completed during the six months under review.

Old Mutual invested $5 million in the Kupinga 1.6 MW Hydro power station  project , and is expecting a 17 percent annual return from the project.

The group has a 20-year power purchasing agreement with Zimbabwe Electricity Transmission and Distribution Company (ZETDC).- The Source

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