| Thu 28 Jul 2005, 16:10 | | South African Eagle Insurance Company Limited - An |
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South African Eagle Insurance Company Limited - Announcement Of The Unaudited
Results And Dividend Declaration For The Six Months Ended 30 June 2005
SOUTH AFRICAN EAGLE INSURANCE COMPANY LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1965/006764/06)
Share code: SAE ISIN: ZAE000006243
ANNOUNCEMENT OF THE UNAUDITED RESULTS AND DIVIDEND DECLARATION
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Restated Restated
Rand thousands Note Six months Six months Twelve months
ended ended ended
30 June 30 June 31 Dec
2005 2004 2004
CONDENSED INCOME STATEMENT
Insurance premium revenue 1 714 804 1 572 138 3 191 143
Insurance premium ceded to
reinsurers 278 635 260 924 490 283
Net insurance premium revenue 1 436 169 1 311 214 2 700 860
Net insurance premium earned 1 412 347 1 282 630 2 644 891
Investment income 2 86 386 72 933 157 351
Fair value adjustment on trading
investments (928) (8 506) 11 682
Net realised gains on disposal of
investments 40 875 22 993 70 105
Net income 1 538 680 1 370 050 2 884 029
Net insurance claims 939 815 844 039 1 710 561
Acquisition expenses 222 981 201 314 387 427
Administrative and other operating
expenses 157 212 131 591 311 109
Investment expenses 1 914 1 708 3 396
Pension fund valuation adjustment - - 10 000
Profit before tax 3 216 758 191 398 461 536
Income tax expense 63 791 53 093 109 214
Profit after tax 152 967 138 305 352 322
Minority and cell shareholders`
interests 13 281 3 116 24 388
Minority interest 2 812 1 069 2 318
Cell shareholders` interest 10 469 2 047 22 070
Net profit attributable to members
of the Company 139 686 135 189 327 934
After-tax adjustment for:
- Net realised surplus on disposal
of investments, property and equipment (38 598) (20 700) (67 192)
Headline earnings 101 088 114 489 260 742
HEADLINE EARNINGS PER SHARE (cents) 830.0 940.0 2 140.8
EARNINGS PER SHARE (cents) 1 146.9 1 110.0 2 692.5
ORDINARY DIVIDENDS DECLARED
PER SHARE (cents) 200.0 180.0 650.0
SPECIAL DIVIDEND DECLARED
PER SHARE (cents) - - 2 300.0
DIVIDEND PAID PER SHARE (cents) 2 770.0 300.0 480.0
NUMBER OF SHARES IN ISSUE 12 179 500 12 179 500 12 179 500
NET ASSET VALUE PER SHARE (cents) 10 686 10 493 12 424
SOLVENCY MARGIN (%) 48.1 49.7 57.9
COMBINED RATIO (%) 93.5 91.8 91.1
CONDENSED BALANCE SHEET
ASSETS
Property and equipment 60 005 64 884 63 518
Investments 4 961 067 784 424 902 941
Deferred tax assets - 7 824 8 389
Technical assets 467 944 398 646 441 800
Current assets 1 005 462 787 856 906 083
Cash and cash equivalents 938 007 1 051 326 1 152 371
TOTAL ASSETS 3 432 485 3 094 960 3 475 102
EQUITY AND LIABILITIES
Shareholders` equity 1 301 469 1 278 026 1 513 203
Minority and cell shareholders`
interests in subsidiaries 58 991 57 112 50 005
Minority shareholders` interest 6 604 3 243 2 226
Cell shareholders` interest 52 387 53 869 47 779
Retirement benefit obligation 37 105 68 941 83 578
Deferred tax liabilities 5 233 - -
Technical provisions 1 640 779 1 381 199 1 518 717
Current liabilities 388 908 309 682 309 599
TOTAL EQUITY AND LIABILITIES 3 432 485 3 094 960 3 475 102
COMMENTARY
The strong underwriting performance that prevailed in 2004 declined in the first
half of 2005 with the Company nevertheless posting a good underwriting result of
R92.3m (2004: R105.7m). Premium revenue at R1 714.8m was 9% up compared to the
corresponding period in 2004 (R1 572.1m), reflecting satisfactory growth in a
competitive market. Given the current insurance cycle the Company remains
satisfied with the underlying business performance.
Certain weather related events and a number of fires impacted on the fire
account. All other underwriting accounts performed satisfactorily during the
period, notwithstanding the pressure on pricing levels in the current market.
Investment income at R86.4m (2004: R72.9m), before adjusting for the fair
value movement on the Group`s bond trading portfolio, is pleasing particularly
in light of the payment of a special dividend during March 2005 and the drop in
intrest rates on investment funds. The performance of the bond portfolio showed
a positive turnaround. The strong equity market in the first six months enabled
further equity disposals, realising gains of R40.9m (2004: R23.0m).
Whilst earnings per share increased by 3%, headline earnings per share, which
excludes net realised gains on disposal of investments, decreased from 940.0
cents per share for the comparative period in 2004 to 830.0 cents per share.
The solvency margin reduced to 48.1% after payment of the special dividend,
compared to 57.9% at the end of 2004. However, this compares favourably to the
49.7% margin at June 2004 and is in line with the policy of maintaining solvency
in the 40% to 50% range.
While the Directors are confident regarding the Group`s prospects for the
remainder of the year, it should be noted that short term insurance results can
fluctuate and, therefore, figures for the first six months are not necessarily
indicative of the year-end result.
DIVIDEND DECLARATION NO. 68
1. The Directors have declared an interim dividend for 2005 of 200 cents per
share (2004: 180 cents per share).
2. The dividend is payable in accordance with the following timetable:
Last day to trade in order to participate in
the dividend: Friday, 9 September 2005
Shares commence trading ex the dividend from
the commencement of business on: Monday, 12 September 2005
Record date: Friday, 16 September 2005
Payment date: Monday, 19 September 2005
Shareholders may not dematerialise or rematerialise their holdings of shares in
the Company between Monday, 12 September 2005 and Friday, 16 September 2005
both days inclusive.
By order of the Board.
MC South Chairman
NV Beyers Managing Director
Bryanston
27 July 2005
In compliance with rule 3.59 of the JSE Limited Listings Requirements, the
following
information is disclosed:
Resignations from the Board:
1. JM Carter (British) 09 May 2005
2. JL Pamensky 09 May 2005
3. GM Riddell (British) 10 May 2005
Appointments to the Board:
1. DM Burton 10 May 2005
2. SG Morris 01 July 2005
3. DS Phiri 10 May 2005
4. CN Zungu 10 May 2005
Appointment of new Chairman:
MC South 10 May 2005
Restated Restated
Rand thousands Note Six months Six months Twelve months
ended ended ended
30 June 30 June 31 Dec
2005 2004 2004
CONDENSED STATEMENT OF CHANGES IN
EQUITY
Balance at beginning of year 1 513 203 1 197 872 1 197 872
Amount removed from equity on disposal (22 753) 11 674 (68 665)
Revaluation of investments 17 805 (14 025) 137 971
Translation of foreign subsidiaries (9 100) (16 145) (23 447)
Net profit for the year 139 686 135 189 327 934
Dividends paid (337 372) (36 539) (58 462)
Balance at end of year 1 301 469 1 278 026 1 513 203
CONDENSED CASH FLOW STATEMENT
Cash (utilised in)/retained from
operating activities (131 745) 136 625 244 265
Cash generated from underwriting
activities 183 818 109 032 316 981
Net (increase)/decrease in working
capital (56 388) 26 501 (53 551)
Dividends, interest and rental
received 86 386 72 933 157 351
Taxation paid (8 189) (35 302) (118 054)
Dividends paid (337 372) (36 539) (58 462)
Cash effect of investing activities (82 619) 25 580 18 985
Net (decrease)/increase in cash and
cash equivalents (214 364) 162 205 263 250
NOTES
1. Accounting policies
The condensed interim financial statements have been prepared in accordance
with International Financial Reporting Standards (IFRS). IFRS 1 `First-time
adoption of International Financial Reporting Standards` has been applied.
The condensed interim financial statements do not include all of the
information required for full annual financial statements.
The first time application of IFRS 4 `Insurance Contracts` did not have a
significant impact on the recognition and measurement of assets and
liabilities in respect of insurance contracts at 30 June 2005. The Group`s
comprehensive consolidated financial statements for the year ending 31
December 2005 will present all additional disclosures required by this
standard.
Restated Restated
Rand thousands Six months Six months Twelve months
ended ended ended
30 June 30 June 31 Dec
2005 2004 2004
2. Investment Income
Interest and rental income 76 493 63 278 137 170
Dividends 9 893 9 655 20 181
Total investment income 86 386 72 933 157 351
3. Profit Before Tax After (Crediting)/
Charging
Depreciation 11 706 11 870 17 723
(Surplus)/Loss on disposal of
property and equipment (950) 1 093 (2 580)
4. Investments
Investment properties 16 938 51 211 27 958
Investment in associates 9 710 19 830 19 710
- Listed 9 710 6 573 9 710
- Unlisted - 13 257 10 000
Originated loans 8 206 9 238 8 387
Available-for-sale investments 526 327 458 442 523 976
Ordinary shares
- Listed 479 925 414 702 478 871
- Unlisted 35 754 35 422 36 534
Preference shares
- Listed 1 795 - 1 165
- Unlisted 1 368 3 024 1 925
Government and other interest
bearing securities 7 485 5 294 5 481
Trading investments 399 886 245 703 322 910
Total investments 961 067 784 424 902 941
South Africa Foreign Total
subsidiaries
5. Condensed segment information
Six months ended 30 June 2005
Insurance premium revenue
General insurance business 1 483 908 151 253 1 635 161
Alternative risk transfer business 79 643 - 79 643
1 563 551 151 253 1 714 804
Profit before tax
General insurance business 182 679 15 656 198 335
Alternative risk transfer business 18 423 - 18 423
201 102 15 656 216 758
Net assets
General insurance business 1 159 012 86 088 1 245 100
Alternative risk transfer business 115 360 - 115 360
1 274 372 86 088 1 360 460
Six months ended 30 June 2004
Insurance premium revenue
General insurance business 1 400 015 115 074 1 515 089
Alternative risk transfer business 57 049 - 57 049
1 457 064 115 074 1 572 138
Profit before tax
General insurance business 168 775 16 639 185 414
Alternative risk transfer business 5 984 - 5 984
174 759 16 639 191 398
Net assets
General insurance business 1 123 656 78 534 1 202 190
Alternative risk transfer business 132 948 - 132 948
1 256 604 78 534 1 335 138
Twelve months ended 31 December 2004
Insurance premium revenue
General insurance business 2 840 241 201 536 3 041 777
Alternative risk transfer business 149 366 - 149 366
2 989 607 201 536 3 191 143
Profit before tax
General insurance business 390 701 32 893 423 594
Alternative risk transfer business 37 942 - 37 942
428 643 32 893 461 536
Net assets
General insurance business 1 345 314 85 636 1 430 950
Alternative risk transfer business 132 258 - 132 258
1 477 572 85 636 1 563 208
Transfer secretaries
Computershare Investor Services 2004 (Pty) Limited
70 Marshall Street
Johannesburg
2001
Registered office
South African Eagle Insurance Company Limited
Registration number 1965/006764/06
SA Eagle House
The Braes
193 Bryanston Drive
Bryanston
2021
Sponsor
RAND MERCHANT BANK,
(A division of FirstRand Bank Limited)
Date: 28/07/2005 04:00:06 PM
Produced by the JSE SENS Department
