Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Tower: 67% Profit Increase, Plans $120m Capital Repayment


MEDIA RELEASE

For immediate release

29 November 2012

Tower Reports 67% Profit Increase, Plans $120m Capital Repayment

(Auckland – NZ) TOWER Limited today reported a $55.8 million net profit after tax for the full year to 30 September 2012, a 67% increase over the $33.4 million reported for the comparable period last year.

The result reflects improved performance across all business units, compared with the same period last year.

Strong revenue growth was reported by the Life, Health and General Insurance businesses and there was a drop in the level of insurance claims. Premium income growth for the Health business countered the impact of claims’ inflation while price increases in General Insurance policies covered rising reinsurance costs. The Investments business continues to grow with funds under management surpassing $4.2 billion.

Net asset backing improved to $1.85 per share, up from $1.72 per share, and gearing (debt to debt plus equity) dropped to 14.1%, an improvement from around 15%. TOWER has capital in excess of the new Reserve Bank solvency standards.

Given TOWER’s solid financial position, the Board is pleased to announce that a final dividend of 6 cents per share will be paid on 1 February 2013. This brings the annual unimputed dividend to 11 cents per share.

Group Managing Director, Rob Flannagan, said that TOWER had posted an excellent financial result for the year to September 2012 by getting the basics right, resulting in revenue growth, cost reduction and superior investment performance.

“The Group is recovering well from the Canterbury earthquakes and the strong financial performance highlighted the benefits of its streamlined and cohesive operating structure which included business-to-business alliances and partnerships with distributors,” Mr Flannagan said. The year’s financial result includes further claim costs associated with the earthquakes of $13.6 million after taxation.

Capital management is a key focus for the Board which will be recommending a capital return to shareholders of $120 million - this is subject to Court and shareholder approval.

The repayment of capital will comprise the proceeds of the sale of the Health business and existing surplus capital. The repayment is likely to be via a scheme of arrangement. The intention is for shareholders to approve this at TOWER’s annual shareholder meeting, which will be scheduled for March 2013.

With the return of capital planned, the company’s dividend reinvestment plan will not operate for this dividend payment and all shareholders will receive their dividend in cash.


Interim TOWER Chairman, Steve Smith, said that the financial result for the year to September was very pleasing in the difficult economic operating conditions. TOWER continues to explore proposals arising from its strategic review, with this process expected to be completed by the annual meeting in March 2013

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Balance Of Trade: NZ Posts Trade Deficit In October On Falling Dairy Exports

New Zealand’s posted its largest monthly trade deficit for October in six years, while narrowing the shortfall from September, led by a fall in dairy exports to China while all main imports into the country rose. More>>

ALSO:

Gigatown Winner: Plenty Of Positives For Dunedin

Although the city has taken the Gigatown title, along with new ultrafast 1Gbps broadband and funding for $700,000 worth of UFB-related initiatives across the community, Mr Cull says Dunedin has gained so much more through its involvement. More>>

ALSO:

R18: The Warehouse Group Praised For Removing Games

The decision by New Zealand’s largest retailer The Warehouse Group (TW Group), to withdraw stocks of the latest version of Grand Theft Auto V (GTA V) and other R18 games, has been praised by advocacy group Stop Demand Foundation. More>>

ALSO:

Air NZ Wine Awards: Victory For Villa Maria As Pinot Noir Thrills

It was a night to remember as Villa Maria Estate picked up one of the highest accolades of the evening, the O-I New Zealand Reserve Wine of the Show Trophy, at the 28th Air New Zealand Wine Awards. The Villa Maria Single Vineyard Southern Clays Marlborough ... More>>

ALSO:

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news