Guardian Not Distracted By Short-Term Movements In Equity Prices As Superior Long-Term Returns Will Be Derived
Guardian Holdings Limited is reporting that Group profit, attributable to equity shareholders, for the three months ended 31 March 2018, amounted to TT$72 million, a decline of TT$18 million or 20% when compared to the corresponding period last year of $90 million.
Commenting on the financial performance of the Group, Henry Peter Ganteaume Deputy Chairman, reported that this disappointing result was due principally to Net fair value losses of TT$37 million recognized in the current period, as opposed to gains of TT$63 million recorded in the prior period, an overall swing of $100 million.
These movements substantially arose from their equity portfolios and reflect intrinsic volatility in equity markets.
The Group he said, was not distracted by short-term movements in equity prices, as they remain confident that superior long-term returns will be derived from this investment class.
The Group’s Net income from insurance underwriting activities increased by $80 million or 78% to $183 million, as their organic growth initiatives continued to be successful with Gross and Net written premiums increasing year-over-year by $275 million or 17% and $165 million or 15% respectively.
Net income from investing activities declined by $90 million, from $279 million to $189 million, owing to the previously mentioned swing in Net fair value gains and losses.
As a result of applying the expected credit loss model in IFRS 9, the Group for the period ended 31 March 2018, recognized an impairment gain of $5 million.
The Group suffered an unusually high tax charge for the quarter, this is the consequence of the rules governing the taxability of unrealized equity gains and losses versus underwriting income in most jurisdictions he reported.
They do not expect this to have a material effect on after tax results in future quarters.
Despite the above-described “mark-to-market” effect on investments, the core insurance performance reflects the success of many initiatives underway he said. BM
To view Guardian Holdings Limited – Consolidated Financial Statements for the 1st Quarter ended March 31st 2018 click HERE