QBE Insurance Share Price Climbs 6.79% Alongside Net Profit Figures

 QBE Insurance share price has seen a significant upward spike in today’s market, trading at 10.89, up 6.79% at the time of writing.

As Australia’s largest global insurer, QBE Insurance Group Ltd [ASX:QBE] provides insurance services across multiple continents, with employees in over 35 countries worldwide.

Positive growth figures have been brought to light, following the market release of their 2018 half-year results on the ASX early this morning.

The company’s net profit after tax (NPAT) was recorded at $358 million, showing a 4% increase from the 2017 results.

The report also showed an 8.2% return on equity, showing a decent climb from the first half-year result of 6.6% return.

Back to basics set to aid QBE Insurance Share Price

The company have acted to revert the ‘extreme catastrophe experience’ of 2017, where QBE reported a full-year loss of US$1.25 billion.

In this past half-year, QBE have mobilised the Brilliant Basics Program in an effort to streamline the business. Initiatives included in this scheme include selling the Latin American business sector, which was causing consistent concern, to Swedish company Zurich Insurance. And further minimalisation of the company came from QBE offloading their travel insurance business to NIB holdings. This was a $25 million deal.

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Also in this last half year, the Cell Performance Review — a performance management process — has commenced. 300 cell reviews have already been conducted.

These new implementations are ‘expected to drive significant performance improvement over time, improving earnings quality and resilience across the group more globally.’

Long hall for QBE’s transformation

Though these schemes have resulted in short-term leverage, QBE are conscious of the complexity of the two new processes:

‘…full implementation will take several years and will involve transformation of QBE’s culture and business practices to consistently deliver world-class underwriting claims and management.

From an investment perspective, the company’s dividends look intriguing. QBE declared the 2018 interim dividend of 22 cents per share, in line with the 2017 interim dividend figure:

The group’s dividend policy is designed to ensure that we reward shareholders relative to cash profit and maintain sufficient capital for future investment and growth of the business.

Shares will start trading ex-dividend on 24 August, according to the ASX report.

Keep an eye on this space for any future updates on the company.

Regards,
Ryan Clarkson-Ledward

For Money Morning

PS: Income specialist Matt Hibbard reveals five stocks he calls ‘…the best dividend paying stocks on the Aussie market today.’ Find out which stocks he picked in our Free report: ‘Top 5 Dividend Stocks in Australia for 2018’. 


Ryan Clarkson-Ledward is an Editor at Money Morning.

Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects.

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