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

 


QBE - First Take: QBE Feeling Pressure On Margin Constraints


QBE - First Take: QBE Feeling The Pressure On Margin Constraints

On first blush, headline figures came in broadly in-line, with net profit (reported) up 8% on last year at $761 million. Gross written premium was also stronger year-on-year, higher by 1% to $18.43 billion dollars. Final dividend was slightly better due to franking, with QBE reporting a $0.10 fully-franked dividend versus a $0.11 25% franked dividend on consensus.

However, expected headline figures were around $891 million for reported NPAT, and $18.48 billion for written premium. The number get murkier still with insurance margins up year-on-year at 8.0% versus 7.1%, however they are just below the consensus of 8.1% with some calling for margins of 8.6%. The main question being asked is; where can the increases in margins come from?

Management’s margin guidance of 11% was reconfirmed today; some margin increases are expected to come from ‘transformation program’ costs which should add 1% to 1.5%. However this has surely been taken into account on the results today, therefore the additional increases to the forecasted margin are hard to find.

Guidance was also vague, and based on what we have just seen for FY12, there is downside risk to FY13. The US and Australian guidance looks like it has been squeezed again, margin guidance looks high, and costs are up; do not be surprised to see downgrades to guidance over the course of the year.

However, the new management team does look like its ‘clearing the decks’ with restricting of the portfolio and the will to attack costs head on, and that may just hold back the guidance downgrades. Only time will tell.

EVAN LUCAS
Market Strategist
www.igmarkets.com

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Fisheries: Report On Underrsize Snapper Catch

The report found that commercial fishers caught 144 tonnes of undersized snapper in the Snapper 1 area – about 3% of the total commercial catch – in the year ending February 2015. The area stretches from the top of the North Island to the Bay of Plenty and is one of New Zealand’s most important fisheries. More>>

ALSO:

Tourism: China Southern Airlines To Fly To Christchurch

China Southern Airlines, in partnership with Christchurch Airport and the South Island tourism industry, has announced today it will begin flying directly between Guangzhou, Mainland China and the South Island. More>>

ALSO:

Dodgy: Truck Shops Come Under Scrutiny

Mobile traders, or truck shops, target poorer communities, particularly in Auckland, with non-compliant contracts, steep prices and often lower-quality goods than can be bought at ordinary shops, a Commerce Commission investigation has found. More>>

ALSO:

Auckland Transport: Government, Council Agree On Funding Approach

The government and Auckland Council have reached a detente over transport funding, establishing a one-year, collaborative timetable for decisions on funding for the city's transport infrastructure growth in the next 30 years after the government refused to fund the $2 billion of short and medium-term plans outlined in Auckland's draft Unitary Plan. More>>

ALSO:

Bullish On China Shock: Slumping Equities, Commodities May Continue, But Not A GFC

The biggest selloff in stock markets in at least four years, slumping commodity prices and a surge in Wall Street's fear gauge don't mean the world economy is heading for another global financial crisis, fund managers say. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news