Listed insurer Sanlam Kenya has issued a profit warning as it projects fall in net earnings by at least 25 per cent in 2016 compared to the previous year.
The insurer attributed the anticipated profit drop to market-to market fair value on equity investments and government securities.
It also cited lower income from sale of properties and increased cost associated with the implementation of a new strategy for growth.
“Implementation of the group strategy commenced in 2016 with realisation of the benefits expected to start in 2017 with a marked improvement in overall growth and profitability,” the company noted in its announcement.
Sanlam Kenya posted a Sh129 million loss in the first six months of the year compared to a net profit of Sh284 million in the same period last year. The insurer blamed a slow property market for the losses.
It then said it had adopted a new five-year strategy that includes rebranding and changes to its distribution channel in the life insurance business.