SINGAPORE (July 18): United Overseas Insurance (UOI) reported earnings of $6.9 million for the quarter ended May, down 15.5% from 2Q17 earnings of $8.2 million a year ago due to lower profit from both underwriting and non-underwriting income.
This brings the company’s earnings for 1H18 to $11.4 million, representing a 24.8% decline from $15.2 million a year ago.
Gross premium for the latest quarter fell 0.9% to $29.5 million from $29.8 million a year ago.
Net earned premium increased by 0.7% in 2Q18 due to lower unearned premium reserve strain. Net claims incurred decreased by $0.2 million or 9.1%. Net commission was an expense of $0.3 million.
Consequently, underwriting profit declined 0.2% to $4.7 million in 2Q18, while non-underwriting income fell by 30.9% to $3.4 million from $5 million previously.
Due to the lower profit from both underwriting and non-underwriting income, profit before tax fell 16.1% to $8.1 million.
The board has declared an interim dividend of 8.5 cents per share, which translates to a total interim dividend of $5.2 million, in respect of the current financial year. It will be paid out on 13 Aug.
Going forward, UOI expects the general insurance market to continue being affected by intense competition resulting from unabated growth in worldwide market capacity.
While UOI expects premium rates to continue its slide and erode underwriting margins in many lines of business, the company remains confident in its ability to remain on a profitable track as it continues to pursue its time-tested underwriting prudence and grow its business from all sources.
On the investment front, UOI says it will continue to calibrate its investment strategies to ride the volatility arising from the many global uncertainties.
Shares in UOI closed flat at $6.60 on Wednesday.
