Home' Trinidad and Tobago Guardian : October 6th 2016 Contents OCTOBER 6 • 2016 www.guardian.co.tt BUSINESS GUARDIAN
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Even as Suriname s economy
continued to experience difficult
times, its largest and most prof-
itable insurer, Assuria NV, cel-
ebrated 25 years on March 25,
Like T&T, Suriname continues to adjust to
lower commodity prices. Assuria was able to
benefit from currency devaluation as many of
its investments are held in hard currencies.
We will now review Assuria s performance for
the year ended December 2015.
Changes in financial position
Total assets grew by 42.7 per cent to Sr$1.39
billion from Sr$973.7 million as at December
2014. Long-term assets experienced the largest
movement, advancing from Sr$853 million to
Financial investments rose to Sr$856.1 million
from 2014 s Sr$569.2 million or by 50.4 per
cent. This change was heavily and positively
influenced by the devaluation of the local cur-
rency; Assuria has a large portion of its invest-
ments, that is, term deposits, bonds and secu-
rities, denominated in foreign currencies,
The three main classifications of long-term
assets were: investments held to maturity, loans
and receivables and trading portfolio. The largest
increase was observed under the first category,
which value improved to Sr$466.8 million from
Sr$280.1 million. In the case of the trading port-
folio, the increase was from Sr$105.4 million to
Sr$206.4 million. Loans and receivables expe-
rienced a marginal decline to Sr$182.9 million
from Sr$183.6 million; although mortgages fell,
other loans increased.
The increase in both goodwill and tangible
fixed assets were influenced by the acquisition
of T&T s Mega Insurance, now re-named Assuria
Life (T&T) Ltd. Goodwill rose to Sr$4.3 million
from Sr$2.78 million, with Mega contributing
Sr$1.5 million. Fixed assets climbed to Sr$82.4
million from Sr$56.2 million; Mega/Assuria T&T
contributed Sr$19.5 million to the increase.
Real estate investments closed at Sr$104.4
million from Sr$63.7 million; this includes assets
from its 50 per cent stake in DSB-Assuria and the
investment properties of Assuria Life (T&T). Invest-
ments in non-consolidated participations represents
its 44 per cent stake in DSB Bank; this value rose
from Sr$155.8 million to Sr$183.2 million.
Current assets rose to Sr$151.7 million from
Sr$120.7 million. This consists of three components:
insurance related receivables, other receivables and
cash and equivalents. Under the other receivables
section, the retirement benefits assets from Assuria
Life (T&T) represented Sr$9 million.
Cash and cash equivalents fell to Sr$45.8 mil-
lion from Sr$64.1 million. This decline was
influenced by the purchase of Mega Insurance
(Sr$0.42 million) and its investment in fixed
assets (Sr$13.9 million).
Total liabilities rose by 73.4 per cent to Sr$1.09
billion from Sr$629.4 million.
Long-term liabilities climbed to Sr$958.7 mil-
lion from Sr$532.7 million or by 80 per cent.
The largest movement was under insurance
related provisions, which advanced by 81.7 per
cent to Sr$901.5 million from Sr$496.3 million.
The life insurance portion rose from Sr$408
million to Sr$738.6 million; the largest contributor
to this increase was Assuria Life (T&T), which
accounted for Sr$160.2 million. The non-life
portion advanced to Sr$163 million from Sr$88.3
million; here, within the outstanding claims
component, the largest increases were recorded
under medical claims (Sr$40 million) and motor
claims (Sr$12.3 million).
Current liabilities increased to Sr$132.7 million
from Sr$96.7 million. Of particular note was
the increase in current taxes to Sr$23.7 million
from Sr$12.8 million. In addition, the long-term
tax liability climbed to Sr$19.3 million from
Sr$3.2 million. These huge changes were largely
influenced by the phasing out of the equalisation
reserve over a two-year period starting December
Total equity fell from Sr$344.3 million to
Sr$297.9 million, of which Sr$0.9 million related
to non-controlling interests. Consequently,
shareholders equity declined to Sr$296.9 million
from Sr$343.7 million.
The largest contributors to this decline were
a technical reserves adjustment of Sr$77.4 mil-
lion, income tax in relation to the settlement
of the equalization reserve of Sr$12.7 million
and dividends of Sr$12.1 million; offsetting
these charges were the revaluation of its invest-
ment in non-consolidated participations (DSB
Bank) of Sr$25.4 million and currency translation
and other adjustments of Sr$5.2 million.
With 6,553,801 shares outstanding, each share
had a book value of Sr$45.31 (December 2014:
Income and profits
Total income increased by 80.5 per cent to
Sr$465.3 million from Sr$257.8 million. Both
life and non-life gross premiums recorded strong
increases. Helped by the Mega Insurance pur-
chase, the life portion rose to Sr$119.9 million
from Sr$71.5 million or 67.5 per cent. The non-
life portion advanced by 42.2 per cent to
Sr$228.8 million from Sr$161 million. Reinsur-
ance premiums ceded rose to Sr$46.2 million
from Sr$40.1 million.
Realised investment income increased to
Sr$58.8 million from Sr$48.2 million; this mainly
related to term deposits (Sr$18.6 million) and
trading securities (Sr$16.8 million). In contrast,
unrealised investment income fell to Sr$3.6
million from Sr$13.9 million.
Other income advanced to Sr$100.4 million
from Sr$3.3 million. The largest contributor to
the current result was Sr$63.4 million in
exchange rate differences relating to insurance
liabilities. Other components were agency com-
mission of Sr$4.9 million and rental property
of Sr$1.8 million.
Total expenses rose to Sr$421.8 million from
Sr$208.4 million or by 102.4 per cent.
Claims and surrenders climbed to Sr$157
million from Sr$78.3 million. Non-life claims
rose by Sr$58.8 million to Sr$118.1 million from
Sr$59.3 million. The increases were mostly con-
centrated under medical claims of Sr$45.9 mil-
lion and motor claims of Sr$6.6 million.
Life claims increased from Sr$19 million to
Sr$38.9 million. All four classifications exhibited
gains; annuities advanced by Sr$5.5 million
while death benefits were Sr$3.4 million; expi-
rations contributed Sr$6.8 million and surrenders
rose by Sr$4.2 million.
Changes in insurance related provisions rose
from Sr$38.7 million to Sr$140.2 million. The
life component climbed to Sr$134 million from
Sr$40 million while the non-life portion
advanced from a negative Sr$1 million to a pos-
itive Sr$6.2 million.
Operating expenses rose to Sr$105.1 million
from Sr$77.4 million or by 35.7 per cent.
Employment cost rose to Sr$37.4 million from
Sr$29.9 million while social (pension) costs
doubled to Sr$10.7 million from Sr$5.2 million.
Other costs climbed to Sr$32.8 million from
Sr$23.4 million. Finally, acquisition costs, which
includes the purchase of Mega Insurance, rose
from Sr$18.9 million to Sr$24.3 million.
These changes saw pre-tax profits register
at Sr$43.5 million (2014: Sr$49.4 million).
With mainly its overseas subsidiaries in
Guyana and T&T bearing the brunt of taxes,
the after-tax result registered at Sr$43.9 million
versus Sr$45.9 million in 2014.
These results translated into 2015 EPS of
Sr$6.70 compared with Sr$7.00 for 2014.
The newly acquired Assuria (T&T) operations
incurred a heavy loss of Sr$3.966 million,
reflecting the distressed state of the company
and the need to take remedial actions on mul-
tiple fronts. On two occasions in 2015 it became
necessary to inject additional capital into this
At Gulf Insurance, results declined from a
profit of Sr$4 million in 2014 to a small loss
of Sr$86,000 last year; largely contributing to
that result was the need for a one-off charge
relating to the write off of previously used com-
puter software. Plans are in train to change the
name of Gulf Insurance to reflect Assuria s
In Guyana, Assuria General s profit rose to
Sr$628,000 form Sr$260,000. In contrast,
losses at the life operations increased to
Sr$717,000 from Sr$686,000.
In Suriname, Life Insurance profits rose
strongly to Sr$24.4 million from Sr$10.3 million,
representing an increase of 136.2 per cent.
Included in this result is a one-off foreign cur-
rency gain of Sr$17.7 million. The growth in
premiums was helped by the 116 per cent
increase in group single premiums.
At the general insurance company, profits
advanced by 51 per cent to Sr$20.2 million from
Sr$13.4 million; however, this includes foreign
currency gains of Sr$16.9 million.
Overall, the pre-tax profit at its life insurance
business grew to Sr$19.7 million from Sr$9.6
million. Its non-life business contributed Sr$28.6
million from Sr$19.0 million. Meanwhile, its other
operations, influenced by losses at DSB-Assuria,
moved from a pre-tax profit of Sr$20.8 million
in 2014 to incur a loss of Sr$4.8 million.
Share price and dividends
Assuria s share price declined from Sr$105.00
as at December 2014 to Sr$94.75 last December.
Its price closed on September 15, 2016 at
Sr$94.75. In line with these lower results, div-
idends declined from Sr$2.28 for 2014 to Sr$1.85
for 2015. At the recent price of Sr$94.75 the
yield to investors was 1.95 per cent. That price
also reflects a strong P/E multiple of 14.2.
Half-year results to June 2016.
With the help of the IMF, the Suriname
economy is now under a Stabilisation and
Recovery Plan covering the period 2016 to 2018.
Inflation for the twelve months to June 30 2016
was 63.8 per cent. At that same date, the local
currency reached Sr$6.86 to US$1.00 and the
foreign exchange market is now essentially free.
Assuria continues with its deliberate policy of
holding more assets than liabilities in foreign
Total income for the six months to June 2016
climbed strongly to Sr$269.3 million from
Sr$196.2 million. Expenses were also higher,
moving to Sr$269.3 million from Sr$176.8 mil-
lion. Included in that figure was an increase in
insurance related provisions of Sr$309.1 million;
this was largely offset by exchange rate differ-
ences related to insurance liabilities and unearned
premiums of Sr$303.7 million.
Both claims and surrenders and operating
expenses increased; the former rose by Sr$71
million while the latter advanced by Sr$16.3
million. These changes pulled down the core
operating result to Sr$8.2 million from Sr$19.5
However, foreign exchange differences added
Sr$131.7 million to the pre-tax result, which
ended at Sr$140 million from Sr$18.1 million.
After allocating taxes and allowing for minority
interests, the profit attributable to shareholders
registered at Sr$74.5 million compared with
2015 s Sr$17.9 million.
Inclusive of foreign exchange gains, the T&T
operations produced a Sr$3.8 million after-tax
profit while the Guyanese companies incurred
a loss of Sr$0.17 million. Suriname s share was
boosts Assuria's results
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