BIHL drive for diversification yields positive results

GABORONE – In a bid towards increased diversification in an unpredictable economic environment, Botswana Insurance Holdings Limited (BIHL) Group has evidenced a strong push towards new product and operational expansion, which has yielded positive returns. This was communicated in the Group’s half year results for the six months ended 30 June 2013 at a stakeholder breakfast held on August 29th 2013 at Gaborone Sun.

The Group registered profits of P237 million which was 38% higher than P171.9 million achieved in 2012. Group profits before tax grew to P288.6 million 37% up on the P210.5 million achieved in the previous year within the same period. Although expenses at P250.5 million were 14% higher than P219.7 recorded in 2012, this was primarily due to the Group’s increased investment in infrastructure and investment property.

Key initiatives have been underway across the BIHL Group of companies as part of the Group’s strategy to become a fully-fledged financial services operation. These have proved fruitful in the period under review, according to the Group. Such initiatives include the successful launch of the Botswana LifeRewards Prepaid card, which aims to reduce turnaround times for benefit claims. “Bifm’s first half of the year was exceptional with business performing above the prior year.

The good performance is on the back of strong assets under management, a position increased by new mandates won in the latter part of 2012,” noted Mr. John Hinchliffe, BIHL Director. “Bifm Unit Trusts was launched in April 2013 as part of an effort by Bifm to continually contribute significantly to the development of a savings culture in Botswana and has already seen phenomenal uptake within the market.” Bifm’s improved performance is evidenced by an increase from previous year in terms of operating profit (108%), and profit before tax and minorities (159%).

Further diversification is seen in BIHL Sure! which has increased its range of general insurance products offered during the first half of 2013. New products, TravelSure (cover whilst on travel) and IncomeSure (cover in case of retrenchment), have gained quick market acceptance. The launch of further products is planned for the second half of the year, according to the Group. Embedded value, which sees the estimate value of the Group excluding the value attributable to minority interests and goodwill attributable to future new business, saw a significant increase in the period under review.

Embedded value increased by 10% from P2.7 billion in December 2012 to P2.9 billion in June 2013. “Down to the very pillars that make up our strategy, the need to diversify business is clear, something which is not unique to just BIHL. The key focus for BIHL is to ensure greater value for shareholders, something we continue to work towards maintaining and indeed increasing,” concluded BIHL Group CEO, Mr. Gaffar Hassam.