Old Mutual Holdings PLC is back to profitability bouncing from a loss of Kshs 195 million recorded during the first six months of 2023 to a net profit of Kshs 327 million during a similar period this year.
Old Mutual Holdings, Chief Executive Officer, Arthur Oginga, says the profit was powered by a significant reduction in finance costs, which fell from Kshs 1.8 billion to Kshs 529 million. This is after the company converted shareholder borrowing to equity in 2023 which is awaiting all the necessary regulatory approvals.
Additionally, Oginga says the company benefited from a substantial improvement in its effective tax rate, which decreased by over half of its previous value, from 150% to 70%.
A notable highlight in the financial result is a 27% decline in operating profit before financing costs to Kshs 1.6 billion from Kshs 2.2 billion in the first half of 2023. Oginga says the decline was due to an increase in medical and flooding claims in Kenya and higher reinsurance expenses in Uganda.
“Despite the challenges we faced in the first half of the year, we are confident that our strategic initiatives and innovative approach will position us for a strong performance in the coming months,” he said.
