ZIMNAT Lion Insurance slashed eight top management posts to strengthen operating structures and in the process saved $300 million but could not match the performance of its major competitor –
NicozDiamond in the results for the period ended June 30.
Zimnat Lion released a lukewarm set of results that analysts say are below its major competitor on the market.
The results were slightly below market expectations with earnings per share of 86 cents below an average forecast of 92 cents per share gathered by businessdigest from five broking firms.
The businessdigest also gathered a range of between 78-98 cents per share.
Market analysts said the results were uninspiring compared to NicozDiamond, its major competitor that soundly surpassed market forecast during the same comparative period. “The results were reasonable but certainly not up to our expectations,” an analyst said. “They scored far less than their counterpart in all ratios.”
However, managing director Oliver Mtasa said the results were satisfactory to management.
“Comparing the two companies would be inappropriate because NicozDiamond are just coming out of a merger and have written more business,” he said. “We need to wait a little longer before we start a fair comparison between the two companies.”
Mtasa remained optimistic that the company would continue performing well despite the harsh economic environment.
Gross written premium increased 350% to $12,2 billion compared to $2,7 billion during the comparative period last year on net written premium that firmed 414% during the period under review.
Underwriting income went up 263% while investment income jumped 359% over the same period last year.
Mtasa told analysts at a briefing that the group had identified Uganda as a potential area to begin the regional drive.
“Our market survey has identified Uganda as a possible investment area. We are at an advanced stage to secure a management contract,” he said.
The group also announced that it closed two branches in Masvi-ngo and Kwekwe due to increasing costs that were not matched by performance. Mtasa said the remaining branches were performing in line with expectations.