Published: 26 June 2014

Fidelity Life Assurance of Zimbabwe foresees little improvement in the value of their shares within the foreseeable future but remain hopeful of a better performance than last year.

Fidelity Life managing director Simon Chapereka told the company's AGM this afternoon that the company does not see the possibility of much improvement in the value of their shares although they remain hopeful that the company will put in a better performance than that of last year.

According to Chapereka currently the company is one of the 67 negative counters on the Zimbabwe Stock Exchange. "We do not expect any major improvement in terms of the equities but we believe we are confident as management that business will be able to post gains and improvement on last year's performance.

"Investment and realized income is trading at the same rate as last year but with the unrealized income on equities we have a major challenge that currently we are one of the 67 counters on the Zimbabwe Stock Exchange (ZSE) that are in the negative" he said.

Fidelity Life recorded a 15 percent trading loss compared to last year attributed to the divergent of funds to sustain the South View projects.

"On fee income we are trading 15 percent below prior year mainly as a result of the review of interest rates in terms of the deposit rates of the asset management and the micro lending business. We have taken a substantial amount of those businesses as a result of the need to redeploy the investments to fund the South View development project" said Chapereka.

He added that the company has performed profitably despite the liquidity strains recording a growth of 27 percent from last year till May this year.

"The company has continued to trade profitably in 2014 albeit the challenges relating to liquidity and the tight macro-economic operating environment but I'm pleased to say in terms of the company it has been able to do well.

In terms of individual life we managed to post a growth of 27 percent on last year up to the end of May and funeral assurance, we managed to cost 13 percent above prior year and in terms of group business we managed to cost 3 percent above prior year."

Fidelity Life Chairman Solomon Tembo said the liquidity strains posed a challenge as they affected the uptake of their products.

"The liquidity challenges affected the uptake of traditional insurance products, the depressed economic activity saw a number of companies closing shop while those remaining open struggled to operate profitably. As a result premium collection for pensions, employed benefits and individual life products remained a challenge" he said.

He added that the company taking necessary measures to ensure its survival.

"The group is undertaking various initiatives to unlock value and to ensure company survival in these very difficult and trying times," said Tembo.
- BH24

You might also want to read this

• Tight economy chokes Fidelity insurance revenue
• Fidelity cuts off the middleman
• Fidelity Printers issues 21 gold buying licences
• Fidelity prints presidential poll ballots
• Fidelity boss in the eye of audit storm
• Fidelity posts $1,3m loss on asset write-offs
• Fidelity threatens to deregister gold buyers
• Fidelity extends loan to miners
• Fidelity reduces US$ payouts to miners
• Fidelity gets major boost