Sharechat Logo

Tower reports first half net profit rose 44%


Thursday 24th May 2007

Text too small?
Insurer and fund manager Tower today reported a 44% rise in half-year net profit on strong earnings growth.

The company said its March half-year net profit rose to 15.7 million compared with $11.4 million for the same businesses last year.

Net profit after tax attributable to shareholders (including discontinued operations) increased 561% to $214.5m.

The company earned a substantial one-off profit of $198.8m from the separation of Tower Australia.

Today's result includes the operating results of the demerged business for October and November 2006, leading up to separation.

Revenue from continuing operations rose 0.5% to $240.6m.

Earnings per share on continuing operations increased by 44% to 8.33 cents.

No interim dividend will be paid for the period. Chief executive Rob Flannagan said results of the ongoing business were steady.

During the period Tower's Health & Life business grew in key markets and margins improved.

General Insurance's performance was lower, however good operating performance by the Pacific Islands was partially offset by a provision for claims, and higher claims and expenses for the New Zealand business, Flannagan said.

Tower's investments business performed "solidly" but incurred significant costs during the period on compliance with KiwiSaver and the Portfolio Investment Entity regime.

Flannagan said he was pleased with the progress made in re-establishing the New Zealand and Pacific businesses.

He said recent changes to KiwiSaver announced in the budget were an important and positive opportunity for Tower which, as one of the approved default providers, should benefit from the anticipated increase in funds flow.

Shares in Tower last traded up 2 cents at $2.35. During the first half the stock fell 5.4% against a 15% rise for the benchmark NZSX-50 index.

For the latest KiwiSaver news. Visit

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Tower to return 'initial' $70M of capital from sale of life business
Tower shares fall to 2-month low as licensing requirements may weigh on capital returns
Tower's licensing talks with RBNZ may push up minimum solvency requirements
Tower names Hancock as new chief executive, replacing Flannagan
Tower posts first-half profit as asset sales reap gains of $51.4 mln
Fidelity Life acquires most of Tower's life insurance business
Flannagan to leave Tower after strategic review, asset sales
Tower FY profit jumps 67%, to return $120M to shareholders; shares jump
Tower sells medical insurance unit to nib for $102M
Stiassny joins Tower board as questions linger over strategy