Afre records surge in profits

period this year. Net premium came in at US$35,3 million over the six months.
The Zimbabwe Stock Exchange-listed firm said its subsidiary, First Mutual Limited, contributed 61 percent to gross premium. Group chief executive Mr Douglas Hoto said the financial services firm was poised to take a leading position in its industry.

“The business is looking forward to taking its leading position in the sector and we are close to where we want to be,” he said.
The Afre boss revealed that the group was targeting to achieve US$100 million income by the end of 2013. Of that amount, premium income is seen at US$90 million. The balance will be generated from the rental business.

First Mutual Limited weighed in with US$5,1 million to profit, FMRE Property and Casualty at US$204 000, Tristar Insurance US$148 000, FMRE Life and Health US$107 000 and FMRE Property and Casualty (Botswana) US$92 000.
The financial services group listed property arm, Pearl Properties, weighed in with a total income of US$4,2 million in the period under review.

Afre said it was working on floating its rights issue, but the figure had dropped from the US$15 million mentioned earlier. This follows a closer look at the group’s capital needs.

“Last year, the figure was put at US$15 million,  looked at from what each business requires, not what shareholders can come up with,” said Mr Hoto.
He did not disclose the new figure.
The fresh capital is required to replace about US$4 million policyholder funds allegedly taken by previous leadership. The remainder will fund the recapitalisation of short-term business (Tristar), reinsurance and the Botswana subsidiary.

The statement of group financial position grew by 3 percent to US$169 million compared with the interim period to December 2011.
Afre said it would not declare a dividend in the interim to conserve cash. The group will use US$2 million from internally generated funds to augment its capitalisation funds.

Mr Hoto also said the company would rationalise its portfolio to levels consistent with standard exposure.
This involves reducing equity investments above prudential limits, which were undertaken for strategic reasons.