Kurnia Group
Kurnia Asia continues to record healthy profit
23 February 2010
Petaling Jaya, 23 February 2010 – Kurnia Asia Berhad (KAB) released
its unaudited quarterly financial results for the year ended 31 December 2009
at its corporate head office in Menara Kurnia.
KAB changed its financial year ending from 30 June to 31 December in an announcement
to Bursa Malaysia on 24 June 2009. Accordingly, the financial results for 31
December 2009 are for 6 months only and are compared to the corresponding 6
months period ended 31 December 2008.
KAB recorded a net profit of RM43.08 million for 6 months period ended 31
December 2009 as opposed to a net loss of RM12.00 million recorded last year.
KAB’s Executive Chairman, Tan Sri Dato’ Paduka Kua Sian Kooi, commented: “We
are pleased to continue recording healthier profits through our on-going internal
transformation programs, namely Transformation of Operations and Performance
(TOP) and Mission 15. Against a more positive outlook in the local investment
market and on the back of an anticipated global financial market recovery,
we will enhance our profitability for the financial year ending 31 December
2010.”
The significant improvement in profit can be attributed to the strong performance
of the Group’s investment portfolio. Net investment income for the period
ended 31 December 2009 was RM58.18 million, a sharp contrast to last year’s
net investment loss of RM9.49 million. While the comparative period was substantially
weighed down by mark-to-market losses, the recovery of the equity market during
the period under review had allowed the Group to write back some of the mark-to-market
losses provided previously. As at 31 December 2009, the net asset value of
the Group improved to RM300.08 million as compared to RM206.90 million recorded
in the full year 30 June 2009.
In accordance with the Group’s on-going transformation initiatives to
practice more stringent business risk selection and better claims management,
the net claims incurred has declined by 10.6% from the same 6 months period
last year and 11.4% from the same quarter last year. As a result of the stricter
risk selection practices, the Group’s gross premium declined by 13.6%
to RM473.94 million from the same 6 months period last year. Consequently,
the Group’s underwriting surplus declined to RM4.27 million for the 6
months financial year ended 31 December 2009.
Reaping the results of its cost transformation initiatives implemented via
Mission 15, the Group successfully reduced its management expenses for the
6 months period by 24.7% to RM78.32 million year-on-year and by 29.1% to RM36.35
million from the same quarter last year. Mission 15 initiatives place greater
emphasis on building a more efficient and resilient organization to achieve
sustained productivity and profitability.
On a final note from Tan Sri Kua: “Moving forward, we expect our flagship
company, Kurnia Insurans (Malaysia) Berhad (KIMB), to benefit from the much
anticipated structural change in the motor insurance scheme that will take
place as early as mid-2010 and also to benefit from a more liberalized operating
environment in the insurance industry. Furthermore, the Malaysian Automotive
Association (MAA) expects the total industry volume of new vehicle sales to
grow 2.4% to 550,000 units this year. Hence, we are confident that with the
strong platform that we have established with our staff and our partners, and
with our market strength, we will succeed in growing profitably and recording
a sustainable performance for our financial year ending 31 December 2010.”
In an effort to continuously enhance its competitiveness, KIMB has expanded
its Kurnia Express (KE) centres to 106 touch points, including its 30 branches
nationwide. More KE centres will be opened during the financial year in partnership
with its business partners such as agents and panel workshops. This claims
service enables comprehensive motor policyholders to immediately settle their
own damage claims of up to RM3,000. The same service has been extended to include
windscreen claims of up to RM5,000 for policyholders who have windscreen insurance
coverage.
In addition, KIMB has plans to extend the Kurnia Auto Assist (KAA) Riders
on motorcycles to other major cities in Malaysia. Currently only available
in the Klang Valley, KAA Riders aim at arriving at breakdown scenes within
15 minutes in the Klang Valley to render repair service if possible. The KAA
service can be contacted at 1-800-88-3833.