KUALA LUMPUR: LPI Capital Bhd
saw improved earnings and revenue of RM83mil and RM363.5mil respectively in its fourth quarter ended Dec 31, on the back of higher contribution from the general insurance segment.
LPI said the improved revenue contribution came despite new competitive pressures arising from new liberalisation initiatives.
The group posted 2.2% or RM7.3mil higher gross earned premium in the general insurance segment in the fourth quarter due to organic growth and increased market share from its diversified distribution channels.
For the entire financial year, the segment contributed the lion's share of overall revenue of RM1.47bil, which was 6.7% or RM91.7mil higher from the previous financial year.
"This was on the back of a strong underwriting performance, with underwriting profit increased by 9.8% to RM305.8 million from RM278.5 million previously.
"The improved underwriting results was contributed by a strong growth in net earned premium by 10.8% to RM850.2 million from RM767.3 million previously and good claims incurred ratio of 38.5%."
Profit before tax for FY2017, however, was brought 22.2% lower to RM403.7mil from RM518.9mil registered in 2016.
LPI said this was due to a non-recurring gain of RM150.4mil from the sale of equity investment in 2016.
Excluding the one-off gain on the sale, the group's profit before tax in FY2017 was a 9.6% or RM35.2mil increase over the previous year.
LPI has declared a dividend of 45 sen a share, which brings full year dividend payout to 72 sen a share. This compares to the 55 sen payout in the year-ago quarter and 80 sen for the previous financial year.
The group forecasts growth to remain strong in 2018 although the liberalisation process will continue to pose new challenges to the insurance industry.
"We are nevertheless confident that the Group will be able to ride the challenges and take advantage of the opportunities presented to report another favourable performance for 2018.
"The Group will continue to leverage on technology to distribute its products and to further enhance its services to our customers. We believe that investment in technology will enable us to further expand our business segment and strengthen our market position," it said.
As at 2.20pm, LPI is trading 30 sen or 1.59% higher at RM19.16, which puts it on track to set a new historical high. The counter's highest close was RM19.06 on June 6, 2017.
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