Friday, October 24, 2008

LPI Capital profit rises 14%

Unit Lonpac Insurance contributed higher premium income in first nine months

PETALING JAYA: General insurer LPI Capital Bhd’s net profit rose 14.4% to RM71.6mil for the first nine months ended Sept 30 from the previous corresponding period on higher premium income from wholly owned subsidiary Lonpac Insurance Bhd.

Revenue increased by 16.6% to RM521.6mil while earnings per share improved to 52 sen against 45.4 sen previously.

Return on equity increased by 22.2% to 22 sen per share.

For the third quarter net profit rose to RM26.2mil from RM21.5mil on sales of RM191.7mil.

Earnings per share improved to 19.06 sen per share from 15.63 sen before. No dividend was announced for the third quarter.

LPI Capital said given its limited investments in equities and bonds, it was unlikely to be significantly impacted by the current financial volatility.

“Unless the global financial crisis or in the event a recession in Malaysia is significant enough to have an adverse impact, LPI will be able to maintain its performance based on its financial strength and good corporate governance,” a company official said.
Lonpac’s investment portfolio comprised 70% fixed deposits, 20% equities and bonds and 10% government securities, according to the official.
Most of its stock holdings are in Public Bank shares.
In a statement yesterday, chairman Tan Sri Teh Hong Piow said LPI Capital’s improvement was mainly attributed to Lonpac’s ability to chalk up a 14% growth in net premium income to RM293.2mil from RM257.1mil.
The higher premium income coupled with a stringent underwriting policy and prudent risk evaluation and management translated into underwriting surpluses, which Lonpac had been able to maintain year-on-year, he said.
Lonpac also registered a higher solvency margin surplus of RM221.2mil on top of the minimum required solvency margin of RM490.2mil, forming a total asset base of RM711.4mil as at end-September.
AM Best, an international insurance rating agency, has reaffirmed Lonpac’s financial strength rating of A- and an insurer credit rating of A-.
LPI Capital
Recommendation: BUYStock Code: 8621 Bloomberg: LPI MK Price: MYR9.60 12-Month Target Price: MYR12.00 Date: October 13, 2008。



Post a Comment

Subscribe to Post Comments [Atom]

Links to this post:

Create a Link

<< Home

hit counter dreamweaver
hit counter script