July 30, 2021
Guardian Holding Limited (GHL), for the six months ended June 30, 2021 reported gross premium written of TT$3.73 billion, 6% higher than the TT$3.52 billion reported for 2020. As a result, net written premium increased by 1% from TT$2.22 billion last year to TT$2.25 billion for the six months ended June 30, 2021. The Company noted that, “The Life, Health and Pension business segment recorded 4% growth in gross premiums primarily from the Trinidad and Jamaican markets. The integration of the life insurance and annuities portfolio acquired by Guardian Life Limited at the end of Q3 2020 from NCB Insurance Company Limited, has contributed to the increase in this segment’s results for the half-year. The Property and Casualty business segment also recorded growth in gross premiums by 8% primarily from fronting arrangements, and our operations in the Netherlands.” For the quarter ended June 30, 2021, gross written premium amounted to TT$1.69 billion (2020: TT$1.54 billion) and net written premium totalled TT$998.63 million (2020: TT$982.92 million).
Net results from insurance activities for the six months fell 24%, year over year, from TT$550.95 million in 2020 to TT$417.01 million in 2021, whereas for the quarter, net results from insurance activities amounted to TT$208.97 million (2020: TT$370.21 million). Management stated that, “This is largely driven by our Trinidad Life, Health and Pension business that experienced an increase in policy lapses and a decrease in premium collection as a result of the lockdowns triggered by COVID-19.”
Net income from investing activities increased to TT$769.95 million in 2021 from TT$315.63 million in 2020. For the quarter, net income from investing activities rose 51% to TT$437.55 million (2020: TT$288.88 million).
GHL noted that, “This increase was primarily on account of net fair value gains which recorded a favourable movement of TT$420 million, from a loss of TT $309 million in the prior period to a gain of TT$111 million in this period, driven by net positive movements in the Group’s regional equity portfolios. Your Group continues to closely monitor the investment markets and rebalance portfolios as necessary.”
Fee and commission income from brokerage activities for the six months fell 1% to TT$71.98 million (2020: TT$72.74 million). Whereas for the quarter, fee and commission income from brokerage activities rose 7% to TT$35.27 million (TT$32.96 million).
Net income from all activities for the six months rose 34% to TT$1.26 billion (2020: TT$939.32 million). Net impairment losses on financial assets the period under review was TT$58.79 million in 2021 relative to a loss of TT$24.17 million in 2020.
Operating expenses for the six months ended June 30, 2020 rose 24% to close at TT$768.64 million relative to TT$618.47 million in 2020. Whereas, operating expenses for the second quarter rose 49% to close at TT$459.57 million relative to TT$309.36 million in 2020. Management also stated that, “The Group is closely monitoring expenses as it continues to incur costs associated with the implementation of IFRS 17 (Insurance Contracts) as well as with our Group wide transformation initiatives.”
The Company also booked finance charges of TT$102.99 million for the six months (2020: TT$73.25 million).
Operating profit for the six months ended June 30, 2021 amounted to TT$328.53 million relative to an operating profit of TT$223.44 million booked for the comparable period last year. Operating profit for the second quarter ended June 30, 2021 amounted to TT$116.19 million relative to an operating profit of TT$309.30 million, a 62% decrease.
Share of after tax profits of associated companies amounted to TT$9.01 million (2020: TT$10.73 million).
Profit before taxation amounted to TT$337.54 million relative to a profit of TT$234.17 million in 2020. For the quarter, profit before taxation totalled TT$121.63 million (2020: TT$315.24 million).
Following taxes of TT$77.25 million in 2021 (2020: TT$80.61 million), net profit after tax totalled TT$260.29 million for the six months ended June 30, 2021, compared to a net profit of TT$153.56 million reported last year. For the second quarter, net profit after taxation amounted to TT$83.02 million (2020: TT$194.46 million).
Deficit attributable to participating policyholders was TT$2.5 million relative to a surplus of TT$13.85 million in 2020. Therefore, profit for the period amounted to TT$256.14 million relative to a net profit of TT$164.60 million in 2020 and for the quarter, profit amounted to was TT$81 million (2020: TT$202.16 million).
Net profit attributable to shareholders amounted to TT$256.14 million relative to a profit attributable to shareholders of TT$167.41 million in 2020. For the quarter, net profit attributable to shareholders was TT$81 million (2020: TT$202.16 million).
Total comprehensive profit amounted to TT$256.14 million (2020: TT$164.60 million) for the six months ended June 30, 2021. For the quarter, total comprehensive profit amounted to TT$80.03 million (2020: TT$201.05 million)
As such, earning per share for the period amounted to J$24.45 (TT$1.10) relative to an EPS of J$14.99 (TT$0.72) in 2020. EPS for the second quarter amounted to J$7.73 (TT$0.35) relative to an EPS of J$18.10 (TT$0.87) in 2020. The trailing twelve months EPS amounted to J$82.39 (TT$3.72). The stock traded at J$640.12 as at July 29, 2021 with a corresponding P/E ratio of 7.77 times. The number of shares used in our calculations amounted to 232,024,923 units.
Balance Sheet at a glance:-
Total assets amounted to TT$34.30 billion as at June 30, 2021. ‘Investment securities’ and ‘cash and cash equivalent’ contributed the most the assets base amounting to TT$21.14 billion and TT$3.44 billion, respectively.
Shareholder’s equity as at June 30, 2021 stood at TT$4.64 billion (2020: TT$4.67 billion) resulting in book value per share of J$443.33 (2020: J$418.06).
Disclaimer:
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may affect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.