Suncorp saw a 6% drop in revenue fall following what it called an “unprecedented” storm and bushfire season that forced it to safeguard profit margins in its insurance businesses from massive payouts by boosting its reinsurance cover.
The fall was offset by profits from the sale of two repairs businesses, Capital SMART and ACM Parts, for $293 million, which saw the company’s net after-tax profit jump 156.8% to $642 million, from the first half of the 2018-19 year.
Stripping out the profits from those sales, the company reported a 6.2% fall in net profit from continuing operations to $396 million for the first half.
Suncorp’s overall group revenue fell 6% to $7.05 billion.
Despite the fall and weaker profit, Suncorp has maintained interim dividend at an unchanged 26 cents a share, fully franked.
The company faced seven natural hazard events over the half-year period, with 42,219 claims lodged in Australia and 3,260 in New Zealand.
The hazards included the bushfires which ravaged Australia and killed 33 people and hailstorms along the east coast and floods. The cost of natural hazards was $489 million, $104 million higher than the insurer had allowed for.
Suncorp said it has assessed 90 percent of claims from the bushfires.
Gross written premiums rose 1.8% to $4.176 billion.
Earnings from insurance fell 3.9% to $123 million and in the banking and wealth businesses, they dipped 6.6% to $171 million. Earnings from New Zealand fell 8.1% to $102 million.
