SINGAPORE (Aug 1): Great Eastern Holdings, the life insurance group, posted a 29% decrease in 2Q19 earnings ended June to $169 million from $237.6 million a year ago.
Operating profit from insurance business rose 3% to $161.7 million while there was a non-operating loss from insurance business of $26 million in contrast to a profit of $15.3 million a year ago.
Gross premiums decreased 12% to $2.9 billion in 2Q19 due to lower single premium sales in Singapore.
The group’s Total Weighted New Sales (TWNS) and New Business Embedded Value (NBEV) for 2Q19 fell 9% and 3% respectively compared to the same period last year.
Gross claims, surrenders and annuities increased to $1.7 billion for 2Q19.
Commissions and distribution expenses increased to $254.7 million in 2Q19 from $244.9 million a year ago largely due to higher sales of regular premium policies.
Change in insurance contract liabilities increased to $2.1 billion from $897.7 million last year.
Net investment income increased to $708.2 million for 2Q19 mainly due to higher interest income, offset by lower dividend income.
Fees and other income decreased to $18.8 million due to lower fee income from the group’s asset management arm, Lion Global Investors.
Sale of investments and changes in fair value resulted in a gain of $1 billion in 2Q19 from mainly unrealised fair value gains from fair value through profit or loss (FVTPL) assets due to favourable market conditions.
For the 1H19, earnings rose 31% to $511.7 million.
Great Eastern has declared an interim one-tier tax exempt dividend of 10 cents per ordinary share for FY19 ended Dec, to be paid on Aug 30.
Khor Hock Seng, group CEO, says, “The Group’s investment performance was strong in the second quarter, in line with the favourable market conditions. These gains were largely reflected in the Group’s Total Comprehensive Income instead of the Group’s Profit Attributable to Shareholders.”
Shares in Great Eastern closed 31 cents lower at $25.42 on Wednesday.
