ZHL expedites consolidation of regional operations

LIVINGSTONE MARUFU

 

Diversified financial services group, Zimre Holdings Limited (ZHL) is accelerating consolidation of its regional reinsurance operations to create a single entity  called Emeritus International Reinsurance , in an effort to  strengthen the group’s  position in Africa,  Business Times can report.

ZHL operates reinsurance units in Mozambique and Botswana.

The development was confirmed by ZHL Group CEO, Stanley Kudenga.

“Consolidation of the group’s regional reinsurance cluster under Emeritus International Reinsurance has entered its final phase following the  shareholder approval of the amalgamation of Emeritus Re -Botswana into Emeritus International Reinsurance.

“This move is set to encourage the injection of additional competitive capital to the regional reinsurance units enabling them to further expand the Emeritus brand throughout the African continent,” Kudenga told Business Times.

He added: “The group’s aim is to harvest its insurance value chain and broaden its ecosystem through group synergies and various partnerships locally and across the African continent.

Regulatory approvals to inject capital into Emeritus Re – Mozambique were secured in June 2023 and the recapitalization programme will help the unit to scale up its underwriting capacity ensuring that there is more control of the wallet and cash productivity to generate positive shareholder returns.”

In its financial results for the six months to June 30,  total income  was down 25%   to ZWL$105.8bn from ZWL$141.2bn reported in the prior comparative period.

The group’s insurance contract revenue rose by 42%  to ZWL$34.2bn  in the reviewed period from ZWL$24.1bn reported in the same period last year.

The growth was driven by the reinsurance operations as well as the life and pensions business, which made up 62% and 24%, respectively, of the total premiums written during the period.

The increase in United States dollar revenue from the local business units and new business acquisitions from regional operations drove the growth in insurance revenue.

The rental income for the property business increased by 172% from the previous year.

The insurance service result was poor due to rising direct insurance service costs, which increased by 17% and 412%, respectively, as a result of rising directly attributable costs.

ZHL achieved a favorable claims ratio of 35% for its reinsurance operations in the first half of 2023, down from 72% in the same period last year.

Profit for the group increased by  54% to ZWL$167.6bn  in the period under review.

Gains in foreign exchange on net monetary assets denominated in US dollars and gains from the revaluation of investment properties were  the main factors contributing to the  growth in profitability.

Total assets reached ZWL$1,084 trillion in the reviewed period, an increase of 174% over the same period the previous year, driven by the growth of investment properties and financial assets, demonstrating a strong group balance sheet that aims to increase stakeholder value.

 

 

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