Great Eastern Holdings has reported 2QFY2021 ended June earnings of $232.3 million, a decline of 22% y-o-y.
In its results announcement on August 2, Great Eastern attributes the lower 2QFY2021 performance to financial market conditions that were “not as favourable” for the quarter and resulted in lower mark-to-market gains.
This brings 1HFY2021 earnings to $669.9 million, up 102% y-o-y from $331.4 million previously.
The higher 1HFY2021 earnings come on the back of a 57% y-o-y increase in total weighted new sales (TWNS), due to sustained sales momentum particularly from Singapore as well as the low base effect from the previous year.
See also: Great Eastern offers free Covid-19 protection coverage for all Singapore residents
Given the higher TWNS, new business embedded value (NBEV) grew 43% y-o-y for the 1HFY2021 to $368.9 million.
Operating profit fell 32% y-o-y to $330.3 million, due to higher new business strain in 1HFY2021 and positive one-off items in 1HFHY2020 from the adoption of RBC 2 framework in Singapore and release of unallocated surplus in Malaysia.
Great Eastern also reported non-operating profit of $249.6 million, a reverse from a loss of $187.2 million in the 1HFY2021, on the back of mark-to-market gains from favourable market conditions in 1HFY2021, compared to significant losses a year ago amid unfavourable financial market conditions following the onset of the COVID-19 pandemic.
Profit from shareholders’ fund grew 158% y-o-y to $90 million given to mark-to-market gains amid favourable market conditions.
Great Eastern has declared an interim one-tier tax exempt dividend per share (DPS) of 10 cents, to be paid out on August 31.
The group states the capital adequacy ratios of its insurance subsidiaries in both Singapore and Malaysia “remain strong” and above their respective minimum regulatory levels.
“The strong performance on Total Weighted New Sales and New Business Embedded Value was the result of our business resilience, achieved through the building of capabilities and competencies in our distribution, product and digital front,” says Great Eastern group CEO Khor Hock Seng.
“We are committed to sustainability and are pleased to provide our customers with access to green insurance solutions, starting with our recently launched, GREAT Green SP. This is the first green life insurance product in Singapore and it is a shortterm endowment policy, which invests its portfolio assets to achieve positive environmental impact. We believe this is a step in the right direction to empower our customers to make a positive difference to the environment with their financial decisions,” Khor ads.
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Looking ahead, Khor anticipates challenges brought forth by the evolving Covid-19 situation are “likely to persist”. “We will continue to strengthen our distribution and product offerings to deliver the right solutions to meet the needs of our customers,” he says.
Shares in Great Eastern closed 8 cents or 0.37% lower at $21.61 on July 30.
Photo: Albert Chua/The Edge Singapore
