Great Eastern Holdings, a member of the OCBC Group, reported earnings of $229.8 million in the 4QFY2021 ended December, down 33% from earnings of $341.3 million from the same period the year before.
The lower earnings were mainly due to the higher base in the 4QFY2020, where the group reported a one-off positive tax impact during the period.
In the FY2021, the group’s earnings increased 16% y-o-y to $1.11 billion on the back of more favourable market conditions and higher operating profit from its insurance business.
Total weighted new sales (TWNS) for the FY2021 grew 28% y-o-y to $1.97 billion due to strong contribution from all markets, while TWNS during the quarter fell 6% y-o-y.
The group’s new business embedded value (NBEV) ended the year 21% up y-o-y at $808.0 million, lifted by the 4QFY2021’s NBEV of $262 million, which was up 9% y-o-y.
In Singapore, TWNS fell 17.6% y-o-y to $292.4 million in the 4QFY2021. Singapore’s NBEV 5.38% y-o-y to $123.0 million in the 4QFY2021.
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In the 4QFY2021, operating profit from Great Eastern’s insurance business spiked 126% y-o-y to $173.9 million, largely due to a one-off provision for higher expected future insurance claims made in the 4QFY2020. The higher operating profit has lifted the group’s operating profit for the FY2021 to $752.9 million, up 3% y-o-y.
Non-operating profit from its insurance business for the 4QFY2021 fell 6% y-o-y to $44.7 million, while FY2021’s non-operating profit from its insurance business reversed from the red to $289.7 million from the loss of $88.7 million in FY2020 due to mark-to-market gains.
Profit from shareholders’ fund in the 4QFY2021 plunged 93% y-o-y to $17.0 million, bringing FY2021’s profit from shareholders’ fund down 74% y-o-y to $90.8 million due to fair value losses from equities.
Gross premiums in the FY2021 gained 22% to nearly $19 billion.
As at end-December, cash and cash equivalents stood at $9.12 billion.
A final dividend of 55 cents per share has been declared, bringing FY2021’s total dividend to 65 cents per share.
The dividend is payable on May 5.
“We delivered a strong set of results for the year. Profit attributable to shareholders grew 16% against last year, crossing the $1.0 billion mark to $1,113.0 million. TWNS for the year achieved a 28% increase to S$1,971.6 million, inching forward towards the $2.0 billion mark and NBEV achieved a 21% increase to $808.0 million,” says Group CEO Khor Hock Seng.
“This achievement is the result of our unyielding commitment to transform our business against a backdrop of uncertainty brought about by unprecedented times. We have done well to strengthen our distribution network, arming our core channels of Agency/Financial Adviser and Bancassurance with digital tools to build resiliency into the business. Further, through the consistent execution of our recruitment strategy, we have strengthened our financial representative footprint across the region,” he adds.
Further to his statement, Khor says the group has continued to make “meaningful strides in its sustainability journey” with a slew of initiatives to achieve its two key objectives, which are to improve people’s lives and to transition to a low-carbon economy.
“As we look ahead, we will continue to be challenged by the ever-evolving pandemic and geo-political uncertainties. The group’s resilient performance underscores the strength of our core business fundamentals and we will further build on these fundamentals to achieve a sustainable business for the long term,” says Khor.
Shares in Great Eastern closed 8 cents lower or 0.37% down at $21.58 on Feb 21.
