CBL lifts annual net profit 83%, outperforms IPO forecast

Article – BusinessDesk

CBL lifts annual net profit 83%, outperforms IPO profit forecast

By Sophie Boot

Feb. 29 (BusinessDesk) – CBL Corp, the NZX-listed company that sells credit surety and financial risk insurance, outperformed its initial public offering profit forecast to lift annual net profit 83 percent in 2015.

Net profit rose to $35.5 million in the 12 months ended Dec. 31, from $19.4 million a year earlier, the Auckland-based company said in a statement, on gross written premiums of $294.2 million, from $241.8 million a year earlier.

The company outperformed its IPO forecast profit, in which it predicted reaching $26.1 million profit on gross written premium of $296.1 million. That number excluded its acquisition of Australian specialty insurer Assetinsure, though today’s earnings incorporated four months of its revenue. Assetinsure brought in $16.8 million in revenue in the four months, and net profit of $3.5 million.

“This has been a transformational year for CBL, with the company reaching a number of key milestones and achieving revenue and profit growth across the group,” managing director Peter Harris said. “Following the IPO we are in a stronger position to grow our business both through new product development and expansion into new geographies.”

CBL, which began as Contractors Bonding Ltd in 1973, derives almost 98 percent of its revenue from international operations. The company listed on the NZX and ASX in October, and raised $90 million of new capital in an IPO to bolster its capital base and help fund aspirations to expand.

Capital raised in the IPO was used to fund the purchase of Assetinsure. CBL also took a 92 percent stake in accounting expense insurance provider Professional Fee Protection in the United Kingdom, and 35 percent of Mexican specialist bonding and surety insurance company Fiducia.

The board did not declare a dividend, but said its policy to distribute 30 percent of adjusted net profit subject to regulatory capital and liquidity requirements remain unchanged, and details of the dividend will be announced towards the end of March.

The shares rose 2.3 percent to $2.25.


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