Britam Holdings has issued a profit warning informing shareholders that earnings for this year will be lower than 2019 earnings. Company secretary Nancy Kiruki says ” based on a preliminary assessment of the forecasted financial results of the Company for the period ending 31 December 2020, the earnings of the Company for the current financial year are expected to be substantially lower compared to the earnings reported for the same period in 2019.”
A public notice from the insurer says that the uncertain economic outlook from the pandemic has affected vital business areas of the company, including real estate and the stock markets.
The poor performance of the stock market after the onset of the pandemic reduced the Group’s returns from the equity investments. In 2020 H1, Britam recorded a fair value loss of Ksh 3.1 billion from poor performance in the stock market as investors shifted to fixed income securities. Further, lower occupancy rates and rental yields led to Ksh 929 million losses in property revaluations.
Britam Holdings’ 2020 half-year net loss hit Ksh 1.63 billion compared to a profit after tax of Ksh 1.67 billion in 2019 H1. Going forward, Nancy Kiruki says the company is optimistic about recovery and stability in the operating environment, anticipating better performance in 2021.