Argus reports earnings of $7 million

Posted by on Dec 10, 2012 in Local News & Alerts | 0 comments

 

  • Argus records $7 million profit due to continued strong performance of its core business operations
  • Shareholders’ Equity has increased to $91 million
  • Total assets remained steady at $1.7 billion

Argus Group Holdings Limited today announced a net profit of $7 million for the six months ended September 30, 2012, compared to a net loss of $3.9 million for the corresponding period in 2011.

Alison Hill, CEO, The Argus Group

Alison Hill, Chief Executive Officer of the Argus Group, comments: “The Board and management believes that this welcome return to profit for the Argus Group represents a significant milestone marking the end of challenging legacy issues in the investment arena. While net earnings will continue to be influenced by the strengthening of the Balance Sheet, including investment restructuring activities, the significant investment impairments incurred over the last four years are now consigned to the history books.

“We remain confident of a return to more ‘normal’ times for the Group. This confidence stems from the continued strong performance of the core business operations, strong cash flows and the benefits arising from our sustained efforts to optimise the Balance Sheet and capital structure in a considered and orderly fashion.

“The leadership team is focused on delivering excellent service and satisfaction to our customers and long-term sustainable value to our shareholders, while also fulfilling our commitment to the community. I wish to thank our staff for their hard work and dedication to our clients and thank shareholders for their continued loyalty and support.”

On the Consolidated Balance Sheet, Total Assets remained steady at $1.7 billion. Shareholders’ equity attributable to shareholders of the company has increased to $91 million, substantially in excess of the statutory capital required to conduct the Group’s insurance and financial services businesses by the regulatory bodies to whom the Argus Group reports.

Net premiums earned in the period are in line with the prior year reflecting excellent client retention ratios across all lines of business.

Net benefits and claims increased by 3 per cent primarily as a result of increasing health care costs both locally and overseas, and were enhanced somewhat by the absence of major windstorms or other catastrophic events in the property and casualty businesses of the Group.

In the six months under review, investment income, including change in fair value of investments, increased by 64 per cent mainly due to unrealised gains emanating from the Group’s fixed income portfolios as short term interest rates declined and the yield curve flattened.

Commissions, management fees and other were largely maintained due to increased ceding commissions earned by the Group’s property and casualty operations offset by reduced fees arising from its investment-related businesses.

Operating expenses increased by 10.2 per cent due to the ongoing investment in the infrastructure of the European operations together with the cost associated with the continued strengthening of the management team.

As stated at the AGM, shareholders should rest assured that the Board considers the declaration of a dividend each quarter and is determined the dividends will be resumed as soon as the Board considers it prudent to do so.

N.B. Certain statements in this release may be deemed to include “forward-looking statements” and are based on management’s current expectations and are subject to uncertainty and changes in circumstances.  Actual results may differ materially from those included in these statements due to a variety of factors including worldwide economic conditions, success in business retention and obtaining new business and other factors.

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