Home' Trinidad and Tobago Guardian : November 14th 2013 Contents NOVEMBER 2013 • WEEK TWO www.guardian.co.tt BUSINESS GUARDIAN
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Following receipt of approvals
from the Surinamese and T&T
Central Banks, the Suriname
based insurance and financial
services group Assuria Verzek-
eringen assumed full control of
Trinidad-based Gulf Insurance Ltd on April
However, since Assuria achieved actual own-
ership on March 31, 2013, this was deemed
the effective date of the takeover. In the notes,
acquisition costs for the period to June 2013
are given as 7.1 million SRD; presumably, most
of this relates to the purchase of Gulf Insurance
A new board was reconstituted, which
includes two independent directors, A Lee Loy
and M Jim. The parent also began work on
improving the efficiency of Gulf, starting with
its ICT department. Assuria NV then pumped
TT$20 million (10.42 million SRD) into its
new subsidiary in the form of new capital.
This capital injection allowed Gulf to settle
debts to its reinsurers and to better negotiate
new treaties with them. In turn, the enlarged
capital would enhance the company s ability
to generate new business, which is a priority
for the new board.
The Assuria group comprises subsidiaries
providing coverage in the life, general and
medical insurance lines. In addition, there is
a real estate company, DSB-Assuria Vastfoed
NV and an investment company, Assuria
Beleggingsmaatschappij NV. In 2012, the group
entered the Guyana market, both in the life
and non-life sectors. Now, in 2013, it has ven-
tured into Trinidad, via the Gulf acquisition.
Assuria Group income and claims
For the first six months of 2013, ending on
June 30, the Assuria Group reported turnover
of 139 million SRD (1 Suriname dollar (SRD)
= TT$1.92); this was 26 per cent greater than
the 109.9 million SRD reported for the com-
parative period in 2012. The table shows the
constituent parts of this income stream.
In the life segment, premium growth of 28.5
per cent was largely concentrated to its home
market. On the other hand, claims and benefits
increased by a modest 8.2 per cent, or from
7.2 to 7.8 million SRD.
Much of the 32 per cent increase in non-
life premium income can be attributed to the
contribution from Gulf Insurance Ltd; for the
period April to June 2013, Gulf premiums were
11.36 million SRD (about TT$20.67 million).
Notwithstanding this robust improvement in
premiums, the growth in non-life claims and
benefits, which were also influenced by the
Gulf Insurance acquisition, rose by a much
stronger 44 per cent. In this case, the numbers
moved from 16.1 in 2012 to 23.2 million SRD
in the first half of 2013.
The increase in realised investment income
from 18.21 million SRD to 19.95 million SRD
was largely due to the increase in income from
term deposits; this line item rose from 2.75
million SRD in the 2012 half year to 4.46 mil-
lion SRD in the 2013 period.
Segment and country profitability
Pre-tax profits for the current half-year
came in at 23.9 million SRD, which was 41
per cent greater than the 17 million SRD record-
ed for the first half of 2012. This result was
helped by the negative goodwill of 2.6 million
SRD arising out of the acquisition of Gulf
A breakdown of this result reveals that the
Suriname based, life, general and medical com-
panies produced a modest 12 per cent improve-
ment; their contribution moved from 9.8 mil-
lion SRD in 2012 half year to 11 million SRD
in the six months to June 2013.
From a low base of 1.4 million SRD, the life
segment delivered a 93 per cent improvement
to 2.7 million SRD; this result was helped by
lower foreign exchange losses. The profit from
the general insurance segment slipped by 6.8
per cent, moving from 5.9 million SRD in 2012
to 5.5 million SRD in the 2013 period. Results
from the medical segment improved by 12 per
cent, or from 2.5 to 2.8 million SRD.
The net results from its Guyanese operations
were zero. The small profit of 0.3 million SRD
generated by its general business was cancelled
out by a loss of equal magnitude from its life
operations. Based on only three months figures,
Gulf Insurance Limited delivered a profit of
0.4 million SRD.
The major profit improvements occurred
in its investment activities. One of the star
performers was Assuria Beleggingsmaatschappij
NV, which delivered a 36 per cent improve-
ment, moving from 5.5 million SRD last half-
year to 7.5 million SRD for the current half-
year. However, much of this profit was due to
unrealised capital gains.
In addition, the contribution from Assuria
NV increased by 126 per cent to reach 5.4 mil-
lion SRD from 2.4 million SRD in the 2012
period. As stated earlier, this figure was boosted
by the negative goodwill of 2.6 million SRD
relating to the Gulf Insurance acquisition.
The balance sheet
The size of Assuria s assets grew by almost
15 per cent to reach 814.3 million SRD (approx-
imately TT$1.56 billion) as at June 30, 2013
from the base of 710 million SRD as at Decem-
ber 31, 2012.
Much of this increase can be attributed to
the acquisition of Gulf Insurance in the second
quarter of the current period.
The group s principal asset of 503.8 million
SRD is classified as other financial investments;
as at December 2012, this figure was 446.25
Next in line are investments in non-con-
solidated participations, which had a June 2013
value of 119 million SRD (Dec 2012: 108.8 mil-
lion SRD). Property investments increased by
22 per cent to 95.3 million SRD from their
December 2012 base of 78 million SRD.
Fixed assets expanded by 93.7 per cent to
9.33 million from 4.8 million as at December
2012. Meanwhile, cash and equivalents at 38.9
million SRD, continued to be strong. This rep-
resents 4.8 per cent of total assets. As at
December 2012, this figure was 36.25 million
SRD and, at that time, it represented 5.1 per
cent of total assets.
Inclusive of minority interests, group equity
stood at 278.4 million SRD as at June 2013.
This figure represents 34.2 per cent of total
liabilities. That balance was almost 14 per cent
more than the 244.2 million SRD as at last
The value of life insurance contracts stood
at 340.1 million SRD as at June 2013; this
measure was almost nine per cent greater than
the 312.4 million SRD recorded at December
2012. Meanwhile, non-life insurance contracts
increased by a robust 71.6 per cent, or from
51.4 to 88.2 million SRD; this was primarily
due to the inclusion of the newly-acquired
Gulf Insurance business.
All other provisions and liabilities moved
from the December 2012 base of 61.2 million
SRD to 71.1 million SRD as at June 2013, rep-
resenting a 16.2 per cent increase.
The Suriname Central Bank has instructed
Assuria to reduce its current 49 per cent stake
in De Surinaamsche Bank (DSB) to 20 per cent
on a gradual basis. This is being done so that
Assuria can become compliant with the 2011
Act on the supervision of the Bank and Credit
system. This exercise is expected to bring in
fresh funds, which could help in the company s
Following the acquisition of Gulf Insurance
in Trinidad, much attention will be paid to
this important subsidiary to help it to grow
and achieve its full potential. The parent com-
pany has also set its sights on entering the
life insurance market locally.
Problems with the life insurance segment
in the Guyana market are being addressed and
improvements should become evident in the
short to medium term.
In addition, the general insurance subsidiary
has received a licence to offer motor insurance
in that market; this was expected to start on
October 1, 2013. This initiative should help to
improve its market share.
Internal initiatives include the implemen-
tation of a new software system for its general
and medical insurance divisions. In addition,
a business continuity plan (BCP) is being
adopted with the help of an outside party.
While employees pension rights have been
enhanced, so far, only 43 per cent of its work-
force has agreed to defer normal retirement
to 62 from the current age of 60.
Perhaps, one component of Assuria s future
expansion plans might include a listing of its
shares on the T&T Stock Exchange?
Gulf Insurance Ltd joins The Assuria Group
The acquisition and early moves
Following the acquisition of
Gulf Insurance in Trinidad,
much attention will be paid
to this important subsidiary
to help it to grow and
achieve its full potential.
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