FMG fit for the future with strong result

9 August 2006

FMG fit for the future with strong result

Leading rural insurance firm FMG has begun their second century with a strong 2005/06 profit and growth result, announced today.

The company has posted a net profit of $17.57 million (up from $13.82 million in 2004/05) and equity levels grew by 22.7%. The increase in profit provides FMG with a secure base and excellent financial reserves so the company can continue to deliver outstanding support to rural New Zealanders.

“Our core business is supporting rural New Zealand so we are pleased that our financial performance this year enables us to enter the second century of business with a secure outlook for the future,” says Gordon Smith, Chief Executive of FMG.

Through building financial reserves in a sensible and sustainable way FMG is now able to offer commercial insurance products to its customer base in the farming industry. Mr Smith says the decision to expand into commercial insurance is part of FMG’s commitment to supporting the full range of its customers’ portfolios.

“As the largest insurer to the rural sector we want to ensure all our customers’ interests are protected. The expanded product range means that any commercial business that services the farming industry is now able to access our range of quality insurance services,” he says.

FMG has restructured its Australian operation during the past year and has also been preparing the company for the future by investing in an upgraded information technology system that will enable FMG employees to have information at their fingertips during on-site farm visits and reduce the need for repeat visits.

“These changes are designed to allow us to focus more fully on the New Zealand rural market and improve both the quality and range of insurance products for regional New Zealand,” says Mr Smith.

FMG Finance and FMG Investment Advisory services have also enjoyed good results during the past year. FMG currently has an A- (Excellent) rating from A M Best Company and retains a 38% share of the rural New Zealand insurance market, which is growing annually.

“We are very pleased with the result this year but our focus is firmly on ensuring the company has a stable future outlook. Our improved claims paying ability and equity ratio ensure we can continue to grow and support the New Zealand farming industry for another 100 years,” Mr Smith says.

ENDS

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