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Business Reporter
CBZ Holdings after tax profits for the half year to June 30 2013 declined by 13 percent to US$16 million weighed down by a two-fold increase in the charge for impairment and interest expense. The charge for impairment doubled from US$3 million to US$6,6 million, diluting the increase in total income, which rose from US$64 million to US$69,1 million during the interim period.
Interest income had performed exceptionally well after increasing from US$79 million in the 2012 interim to US$79 million this year. An increase in operating expenditure also watered down profits during the period after rising from US$37,3 million to US$42 million.
Against this background basic earnings per share eased from US5,84c in the first half of 2012 to US5,64c in the half to June 2013. While profitability declined, on the basis of the latest set of unaudited results, investors still have kept strong faith in the group’s viability.
CBZ’s share price closed the June interim period at US13,5c from US10c in January, reaching a high of US16,5c in the intervening period.
The statement of financial position shows that total assets increased from US$1,2 billion from US$1,3 billion in the same period last year.
The group’s total liabilities increased to US$1,174 billion from US$1 billion.
CBZ chairman Mr Luxon Zembe said; “The group continued to show impressive results which reflect sound execution of business plans.”
He said in line with the group’s dividend policy and the need to uphold shareholder investment value, a US$1,45 million dividend was declared for the financial period under review. The flagship, CBZ Bank Limited’s after tax profits for the period also slowed down, dipping by 38,4 percent to US$8 million weighed down largely by a sharp increase in interest expenses.
Profits came down significantly despite an increase in interest income from US$63,2 million to US$71,2 million during the interim period.
While there was notable growth in both interest and non-interest income from US$25,9 million to US$34,1 million and US$15,8 million to US$17,6 million total income was little changed at US$54,7 million from US$53,1 million the prior year.
This was largely attributable to the US$8,26 million increase in interest expense while the doubling in the charge for impairment to US$6,3 million further cut down the bank’s profits.
Advances trended up significantly from US$774 million to US$824 million while deposits grew from US$1 billion to US$1,56 billion.
CBZ Life registered tremendous growth in gross premium written, which vaulted from US$1,7 million to US$3,9 million while net premium also jumped to US$3,8 million from US$1,6 million.
The performance reflected in a US$1,8 million after tax profit in the half to June 2013 against US$382 000 in the same period last year.
Another subsidiary, Datvest’s revenue increased marginally to US$4,9 million from US$4,6 million in the comparative period last year, but after tax profit shot to US$385 000 from US$157 000.
The expansive CBZ Holdings group is made up of the flagship CBZ Bank, CBZ Asset Management, CBZ Building Society, CBZ Insurance, CBZ Properties and CBZ Life Assurance Limited.
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