Britam shareholders will have to wait a bit longer for dividends as the Insurance firm looks to reinvest its profits for the financial year ending December 31, 2023, into DRC entry.
The Nairobi Securities Exchange-listed insurer expects to complete the entry in the coming months pushing its geographical presence to eight countries.
Britam currently operates in seven countries in Africa, including Kenya, Uganda, Tanzania, Rwanda, South Sudan, Mozambique and Malawi.
In its message to shareholders during the firm’s 28th Annual General Meeting, Britam said that the entry into the lucrative DRC market is one of its diversification plans.
“Entry into DRC is one of the activities that the Board has taken quite seriously. We are looking at the market and have already identified some opportunities,” said Britam group managing director and CEO Tom Gitogo while speaking at the AGM.
According to the CEO, Britam is in the fourth year of its 2021-2025 strategic plan – which is right on track as Britam’s profits nearly doubled in 2023 as compared to the previous year.
Gitogo hinted at a possible future dividend payout for shareholders in light of the encouraging financial results in the last three years.
“Our ambitious strategy for growth requires a certain level of funding, hence this decision to postpone dividend payouts,” said Gitogo.
The DRC insurance sector, valued at about $300 million (Sh38.8billion) in 2023, is rapidly expanding, according to Forbes Africa.
The Congolese insurance market currently comprises about seven non-life cover companies, three life insurance companies, two reinsurers, and around 30 brokerage firms.
Britam, currently holds a 13 percent market share in Kenya, offering diverse financial solutions in Life Assurance, General Insurance, Micro Insurance, Health Insurance, Retirement Planning, Property and Asset Management, and Banking.
For the year ending December 31, 2023, Britam reported a 97.4% increase in net earnings, reaching Sh3.2 billion from Sh1.6 billion.
Britam’s performance in 2023 was robust, with a profit before tax of Sh 4.82 billion, a 65% increase from Sh2.92 billion in 2022. This improvement is attributed to growth in both insurance and investment activities.
The Group’s total insurance revenue and fund management fees were up 40 percent to Sh37.1 billion from Sh26.4 billion in 2022.
Of this amount, the international businesses generated Kshs 10.6 billion, accounting for 29 percent of the total insurance business revenue. The international businesses remain a key pillar of the Group’s geographical diversification strategy.
In the year ended 2023, Britam's balance sheet also strengthened, with total equity rising to Ksh 25.69 billion from Ksh 22.16 billion in the previous year.
Britam Group Chairman Kuria Muchiru further expressed optimism about the company's future.
"We have made notable strides in our five-year plan, and we are confident that this strategy will achieve and exceed our target expectations," Mr. Muchiru said. "Our focus is now scaling up the customer-centric transformation to increase customer numbers and revenue growth."
