Great Eastern Q2 profit falls 22% to S$232.2m amid less favourable market conditions
GREAT Eastern Holdings G07 on Monday posted a net profit of S$232.3 million for the second quarter ended June 30, 2021, 22 per cent lower than the S$297.5 million a year ago.
The insurance arm of OCBC attributed this to financial market conditions that were not as favourable for the quarter, which resulted in lower mark-to-market gains.
Operating profit for Q2 fell to S$148 million, down 20 per cent from S$185.1 million a year ago. Meanwhile, non-operating profit eased to S$34.9 million, down 2 per cent from S$35.6 million.
Profit net of tax from shareholders' fund fell to S$55.8 million, down 35 per cent from S$85.3 million the previous year.
Total weighted new sales rose to S$535.9 million, up 88 per cent from S$285.6 million from the previous year, which the insurer said was due to the low base effect experienced in the same quarter a year ago. (see clarification note)
New business embedded value climbed to S$186.7 million, up 58 per cent from S$118.4 million a year ago on the back of strong sales.
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Meanwhile, net profit for the half-year ended June 30, 2021 more than doubled to S$669.9 million from S$331.4 million a year ago.
Earnings per share was S$1.42 for the first half, more than double the S$0.70 for the preceding year.
Total weighted new sales for the same period rose to S$919.5 million, up 57 per cent from S$584.7 million a year ago on the back of sustained sales momentum, particularly in Singapore. (see clarification note)
New business embedded value also climbed to S$368.9 million, up 43 per cent from S$258.8 million the year before.
Profit net of tax from shareholders' fund for the half-year rose to S$102.2 million, up 135 per cent from S$43.4 million a year ago.
The board declared an interim one-tier tax-exempt dividend of S$0.10 per ordinary share for the financial year ending Dec 31, 2021 that will be paid on Aug 31.
Great Eastern group chief executive officer Khor Hock Seng said that the strong performance in total weighted new sales and new business embedded value were due to the resilience of its business built from its strengths on the distribution, product and digital front.
"Looking ahead, challenges brought forth by the evolving Covid-19 situation are likely to persist. We will continue to strengthen our distribution and product offerings to deliver the right solutions to meet the needs of our customers," he said.
Shares of Great Eastern closed 0.09 per cent or two Singapore cents lower at S$21.59 on Monday.
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Clarification note: The article has been edited for clarity.
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