Great Eastern posts 3% rise in Q2 profit to $237.6m; to pay out 10 cents per share dividend

Earnings per share came in at 51 cents, or 4.1 per cent higher than the year-ago period.
Earnings per share came in at 51 cents, or 4.1 per cent higher than the year-ago period.PHOTO: ST FILE

SINGAPORE - Great Eastern Holdings (GE), the insurance arm of OCBC Bank, on Wednesday (Aug 1) posted a net profit of $237.6 million for its second-quarter ended June 30, up 3 per cent from $231.6 million a year ago.

Earnings per share came in at 51 cents, 4.1 per cent higher than an earnings per share of 49 cents last year.

The increase in earnings for the quarter was mainly due to higher profit from shareholders' fund investments, which grew 40 per cent to $69.1 million.

This was, however, offset by lower operating profit (-3 per cent) and non-operating profit (-29 per cent) from GE's insurance business.

An interim one-tier tax exempt dividend of 10 cents per ordinary share has been declared for the financial year ending Dec 31, which will be paid out on Aug 31.

For the quarter, the group's total weighted new sales was 28 per cent higher at $326.7 million, underpinned by growth in Singapore and Malaysia, GE said.

New business embedded value, which is a measure of long-term economic profitability, also grew 8 per cent for the period to $139.5 million, thanks to higher sales.

Commenting on GE's financial results, CEO Khor Hock Seng said: "The group delivered robust growth in new sales during the quarter. Our positive Q2 2018 performance is the result of improved productivity of our distribution channels, and introduction of new products in our core markets."

For the half year to June 30, net profit was up 21 per cent to $390.5 million, mainly attributable to higher operating and non-operating profit as compared to the same period last year, GE said.

In particular, operating profit from the group's insurance business registered a 12 per cent growth to $312.3 million for the half-year period, while non-operating profit registered a gain of $13.9 million, a reversal from a loss of $55.2 million last year.

These were offset by a 32 per cent decrease in profit from shareholders' funds' investments to $70.1 million for the six months to June 30.

On a per share basis, profit attributable to shareholders for the half year came in at 83 cents, up 22.1 per cent from 68 cents in the year-ago period.

As at 10.30am on Wednesday, shares in GE were trading at $27.92, up 1 per cent, or 29 cents after the release of its financial results.