The share price of Namibian-based insurance and banking group Trustco Group Holdings increased by 3.85% to R5.40 on Wednesday, on the back of a 38% increase in headline earnings for the six months ended September 30.
Apart from its insurance and banking portfolio, Trustco is also an active investor in various industries, including real estate, education and resources.
Revenue increased from NAD537 million in the first half of the previous year to NAD552 million in the reporting period, and net profit increased by 17% from NAD128 million to NAD151 million.
The group said its results testify to the growing positive climate for businesses operating a diversified model in an “unforgiving economic environment”.
The group’s focus on insurance revenue paid off with 28% growth on insurance premiums. Total insurance revenue grew from NAD98 million in the comparative period, to NAD126 million in the reporting period.
The insurance segment benefited from positive returns in its investment portfolio, with the property investments making the biggest contribution.
“Strong sales continue in both residential and commercial/industrial estates with price growth and strong market demand indicating that the market for property remains robust in Namibia,” the group said.
Overall revenue from property sales was a bit lower due to a smaller residential phase sold, compared with the first half of the previous financial year.
The banking and finance segment operates in three asset classes, namely mortgages, student loans and small business finance.
The group expects growth from term funding and retail deposits. In the reporting period total gross advance grew by 6.6% to NAD908 million, while non-performing loans as a percentage of total advances decreased from 5.3% to 3.7%.
“Trustco Bank Namibia Ltd continues to remain well capitalised with a total capital adequacy ratio of 34%,” the group said.
The group plans to increase its presence in the Namibian insurance and banking markets in the medium term, while growing its investment portfolio through acquisitions.
Shareholders approved the proposed acquisition of control over the diamond mining and polishing group Huso Investments at a general meeting on October 5.
The group says the transaction “is expected to close on or around the financial year-end date upon the issuance of a diamond mining licence and Export Processing Zone status to the subsidiaries of Huso, at which date Trustco expects mining, cutting and sale of diamonds to immediately begin contributing to the group’s returns.”
The Trustco board has announced an interim dividend of 3.4c per share.