Investors’ nerves are being tested for the second year in a row after Nairobi Securities Exchange listed financial services group, Sanlam Kenya Group issued a profit warning for the full year ended 31st December 2016 saying it expects earnings to fall by more than 25% compared to the previous year.
Sanlam Kenya Plc, which recently rebranded from Pan Africa Insurance Holdings Limited says the significant decline is attributed to adverse equity market conditions experienced during the year. This will result to unrealized marked-to-market losses on quoted equities in Sanlam’s Life Business and a drop in earnings from government securities “combined with a negative persistency experience in the life book”
The firm also added that income from property sales had declined during the year. Further noted that the decline in earnings was impacted by increased expenses related to implementation of the company’s new strategy which commenced in 2016 with realization of the benefits expected to be felt in 2017.
The company’s shares at the Nairobi Securities exchange have lost by more than 50% in value from Sh 61.50 traded in December 2015 to Sh 26.50 seen on Friday’s early trading session.
