Insurance group Britam #ticker:BRIT has issued a profit warning for the year ended December 2017, becoming the ninth publicly traded firm to anticipate an earnings decline of at least 25 per cent.
The company’s net profit for the period will come down from the Sh2.4 billion it reported in the previous year and which benefitted from adoption of a new valuation system that depressed its liabilities.
The absence of the one-time valuation changes will see the company make maximum net earnings of Sh1.8 billion in the review period.
“The board of directors of Britam Holdings Plc wishes to inform the shareholders of the company … the earnings are expected to decrease by at least 25 per cent compared to the earnings reported for the same period in 2016,” the insurer said in a statement Friday.
“The expected decline in earnings is mainly due to a change, in 2016, of the valuation method of the long term liabilities to gross premium valuation (GPV) methodology from the previously applied net premium valuation (NPV).”