Tuesday 23rd February 2021
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Tower Limited today holds its Annual Shareholder Meeting and has reconfirmed its full year guidance, as well as announcing its intention to confirm and pay an interim dividend with its half year results in May 2021.
Blair Turnbull, Tower CEO, says an ongoing focus to create a more agile and digital business model has helped the company weather a number of large events in the first four months of the financial year, while still maintaining a focus on growth and innovation.
“In the four months to 31 January 2021, we achieved $129m Gross Written Premium (GWP), representing growth of 6% on the same period last year thanks to our ongoing focus on delivering for our customers. Along with the addition of the Youi NZ portfolio, this growth has seen our market share increase to 9.2% in December 2020, up from 8.4% at the same time last year,” says Turnbull.
No change to guidance and intention to pay interim dividend
There is no change to Tower’s FY21 underlying Net Profit After Tax (NPAT) guidance of at least a 5% improvement on FY20 underlying NPAT ($28.4m), although falling investment returns and large events have placed some pressure on FY21. This is based on the current level of actual large events.
The large events expense for Lake Ōhau fire and Napier floods has resulted in a $10m large events expense year to date which will impact Tower’s FY21 underlying NPAT. Tower’s aggregate reinsurance cover is triggered at $14m.
Tower has announced an updated dividend policy of 60% - 80% of cash earnings where prudent to do so, with cash earnings defined as Reported Full Year Net Profit After Tax adjusted for acquisition amortisation and unusual items.
Along with the updated policy, Tower has announced its intention to pay a dividend with its half year results in May in what would be the company’s first dividend payment since March 2016. An indicative interim dividend of $0.025 per share is expected to be confirmed at the company’s 2021 Half Year results.
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