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Argus Group profits surge

Insurance firm Argus yesterday announced a net profit of $10.6 million for the six months up to the end of September — a jump of $9 million on the same period last year.

And the firm announced a dividend of seven cents per share, payable next February.

Argus CEO Alison Hill said: “We are proud to report these positive earnings and attribute the growth to the continued strong from our core business operations.

“Argus has positioned itself as a strategic partner that provides both immediate and long-term value to its clients, which has resulted in high client retention levels while operating in fiercely competitive markets.

Ms Hill added: “The leadership team continues to look for opportunities to improve product and client offerings in order to provide increasing benefits to shareholders and clients. Furthermore, we continue to optimise the Balance Sheet and capital structure in a considered and orderly fashion.”

Ms Hill added that the group had expanded its overseas network of selected medical facilities — which had led to “some containment” of overseas medical expenses claims.

And she said: “Next year will be an exciting time for Argus as we pilot a patient advocacy programme in partnership with Johns Hopkins Medicine International.

“A key challenge for Bermuda's healthcare system continues to be the rise in chronic diseases. Preventing and managing these diseases is critical to managing future healthcare costs. The objective of the programme is to assist with the management and coordination of care for our clients living with chronic illness with the goal of improving health outcomes both for our clients and the community as a whole.

“We look forward to continuing our leadership role in health management and wellness.”

Total assets, including segregated fund assets, increased to $2.1 billion, while shareholders' equity has increased to $115.2 million — substantially above the statutory capital level required to to conduct Argus' insurance and financial services businesses.

Net premiums earned also increased by $11.3 million (18 per cent) over the six month period compared to the same time frame in 2013.

The firm's statement added that net benefits and claims increased by almost $10 million — attributed to new business in life and pensions, where reserves increased “in close proportion” to premiums received.

Argus also reported an increase of $8.2 million in investment income and share of earnings of associates for the six month period compared to the same period last year.

The report added: “The decline in long-term interest rates during the period resulted in an increase in the fair value of the group's fixed income portfolio with net realised and unrealised gains of $807,000 reported for the period.

“This is in contrast with the sudden and sharp rise in interest rates during the corresponding prior year period that resulted in reported net realised and unrealised losses of $8.5 million.

“While bonds reported favourable results, the volatility in the equity portfolio resulted in net realised and unrealised losses of $631,000. Additionally, the Group reported a provision on investment property of $1.7 million due to the depressed local real estate market.”

Commissions, management fees and other increased by eight per cent, or $1.2 million, in the period primarily as a result of the increase in assets under management.

The report added: “Operating expenses increased by $1.1 million over the prior period as the group continues to invest in the infrastructure of its European operations and the establishment of a framework that will support our commitment to improve the local healthcare system.”

Argus Group CEO Alison Hill

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Published December 15, 2014 at 4:13 pm (Updated December 15, 2014 at 8:37 pm)

Argus Group profits surge

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