Fidelity targets $55m Southview revenue

HARARE - Zimbabwe Stock Exchange-listed Fidelity Life Assurance (Fidelity) anticipates a $55 million profit from its Southview Park stands project, an executive at the company said.

Fidelity managing director Simon Chapereka yesterday told an analyst’s briefing in the capital that of this amount, $33 million was going to be made in interest income.

“$22 million will be project income, and all this can be achieved. As a matter of fact, the profitability will very well be more than $53 million,” he said.

According to Chapereka, the project is now 84 percent complete and will be completed by the end of the first half.

“Presently, all the stands have been sold with a default rate of one percent; the outstanding issues are around water trenching, tanks and reticulation,” he said.

Fidelity — which last year acquired 81 percent of agro-based manufacturing group CFI Holdings Limited (CFI)’s Langford Estates Limited (Langford) — also expects high uptake for the property which is currently being held as a land bank.

“There is a demand bank of about 22 000 people who want stands, so we are confident we will get takers for Langford,” he said.

The Langford transaction saw Fidelity total land hitting the 864 hectare mark, as a minimum of

11 000 residential stands and developments are expected to commence once regulatory approvals are obtained for Langford.

Meanwhile, the group posted a three percent increase in profit to $5,1 million from $5 million in the full year to December 2015 as revenue surged 36 percent to $52,1 million from $38,2 million.

“Major revenue drivers were insurance premiums, sale of residential stands and interest income,” said Chapereka.

Total comprehensive income for the year slumped 30 percent to $2,6 million on prior year, mainly affected by exchange differences arising from translation of foreign operations amounting to $2,4 million.

Expenses were up 35 percent from $31,8 million to $43 million while underwriting surplus remained flat at $6,7 million.

The anchor company, Fidelity Life Assurance, recorded net premium income of $13,5 million four percent up prior comparable period figure of $13 million, while property sales amounted to $27,5 million, up 51 percent on prior period.

Malawian subsidiary, Vanguard Life Assurance, posted a net premium income of $3,1 million while underwriting surplus went down 20 percent to $1,2 million from $1,5 million.

Fidelity Life Financial Services recorded a

$380 000 profit as asset management unit, Fidelity Life Asset Management and the actuarial services business reported profits of $110 000 and 22 000 respectively.

The group declared a dividend of $0,50 up 12 percent on prior dividend.

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