Fidelity Life announces record year of profit

September 26 2011

Fidelity Life announces record year of profit

Fidelity Life, the New Zealand-owned life insurance company, today reported a record after-tax profit of $18.3 million for the year ended 30 June 2011, up 8% on the previous year.

Chairman Ian Braddock commented that this year has been characterised by a number of challenges that have greatly affected the life insurance sector and New Zealand as a whole.

“The tragic events in Christchurch have given us all a different perspective on life and what we consider important. Within the life insurance sector, the last year has seen a number of significant changes including financial adviser and company regulation, a new tax regime and increased competition I believe our results demonstrate Fidelity Life’s ability to continue delivering strong results in uncertain times,” Mr Braddock said.

Fidelity Life is also pleased to announce that the tax-paid dividend is increased by 36% from $1.47 to $2.00 per share, in recognition of the record profit achieved this year. It is anticipated that the dividend will be paid during the week commencing Monday 17 October 2011 to all holders of ordinary shares in the company who are registered as such in the share register at 5.00pm on Friday 7 October 2011.

Gross insurance revenue increased 7% to $86.7m, with record net new business premium of $14.6m generated during the year, an increase of 6% on the previous year.

Fidelity Life’s investment income from insurance business of $36.8m showed another solid performance and was up slightly on 2010, with the Company achieving steady returns in the equity and fixed interest markets.

The Fidelity KiwiSaver Scheme consolidated its growth during the year – funds under management increased 78% to $206m on 30 June 2011, and membership numbers increased by 10,000 to 71,000.

Chief Executive, Milton Jennings takes great pride in the results the Company has delivered in 2011.

“Many of the challenges of 2011 are now behind us, and we look forward to a positive 2012. The aggressive competition in the market will certainly make it difficult, but we will continue to build on our existing strengths and look to deliver strong results for all our stakeholders,” Mr Jennings said.

For the 15th consecutive year international rating agency A.M. Best reaffirmed Fidelity Life’s A- (Excellent) financial strength rating.

ENDS

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