Afre Corporation is bullish about the outcome of its transformative process and expects to deliver on its budgeted performance for the year, CEO Douglas Hoto said.
Report by Clive Mphambela
In an interview with businessdigest on the sidelines of the company’s annual general meeting in Harare recently, Hoto said a rigorous internal realignment programme and a new culture of openness and transparency had paid off.
Last year, Hoto said Afre would set a new standard in corporate governance practices in Zimbabwe, saying it was his vision for the company to become the new beacon of transparency.
“The policy of full disclosure and transparency has restored confidence in Afre. In addition, there is a clear separation of the interests of the shareholders and the policyholders within the business. The group’s performance is a validation of this, as well as confidence in management, which has seen the share price rising significantly in the past four months on the way to reflecting its true embedded value,” Hoto said.
“We have come far in a very short space of time, resulting in the entire Afre group taking ownership of the new vision to drive the company forward, resulting in a clear determination and commitment to perform as evidenced by the financial results for the year ended December 31 2012.”
Hoto said his company had embarked on a programme that started with a team-building exercise, re-engagement, restoring the internal value system of the organisation and creating a new vision and strategy for driving the business. The new corporate strategy was cascaded down to the rest of the business.
The AGM approved the company’s proposed plans to rebrand the company from Afre to First Mutual Holdings Limited.
Despite a reported decline in profitability in the four months ended April 2013, Hoto said his company was on course to posting a surplus at the end of the financial year.
The company’s gross written premium grew 14% year on year to US$33,59 million while net premium rose 19% to US$29,53 million, with rental income up 12%.
Hoto said the group had experienced a decline in the retrocessions due to the benefits of the recapitalisation, which had strengthened the balance sheet of the company, which was now retaining more of its premium.
Oliver Mtasa, a seasoned insurance practitioner, took over chairmanship of the Afre board from lawyer Innocent Chagonda, who said he had left the company in a very strong position.