British-American Investment Company (Britam) has posted a profit before tax of Sh1.044 billion for its half-year ending June 30 compared to Sh3.010 billion it got in the corresponding 2014 period. The reduction in profit was attributed to the bearish performance of the securities market.
“The decrease in our profits is as a result of the downturn in the performance of the securities market, which impacted negatively on the fair value gains from the financial assets.
This downturn also affected other blue chip companies listed in Nairobi Securities Exchange,” said Britam group managing director Benson Wairegi. Share prices at the NSE have fallen since the beginning of the year, mostly driven by exit by foreign investors.
Other than investments in numerous other securities, Britam also has a 10 per cent shareholding in Equity Group Holdings and 48.82 per cent stake in Housing Finance, both listed in the stock market.
Since the NSE-20 share price started falling in the first quarter, the firm lost about 129 per cent in the net unrealised fair value gains on financial assets by June.
However, Wairegi said the business fundamentals of the company remain strong, and the core business showed tremendous growth. Revenue from the Britam’s insurance and asset management business increased by 77 per cent during the period from Sh6 billion to Sh10.6 billion.
“Overall premium income in insurance businesses grew by 82 per cent from Sh5.6 billion in June 2014 to 10.2 billion in 2015,” said Wairegi.
He said although the Kenyan businesses still lead, revenue from regional business registered an impressive growth of 708 per cent from 262.9 million to 2.1 billion, compared to the same period last year.