Sharp rise in Island Life profits

Fraser

PRESIDENT of Island Life Company, Michael Fraser, is up-beat about the future of the insurance company after posting a profit of $22.9 million in its first quarter unaudited results ending March 2001, following its $166 million profit in the audited results for January--December, 2000.

"We are doing very well and I'm very excited about the prospects for the way forward," Mr. Fraser told The Financial Gleaner adding, "our 2000 results were outstanding and the results for the first quarter of this year show consolidation of our return to financial strength".

The January-March, 2001 quarter profit of $22.9 million or earnings of 32 cents per stock unit compared favourably with a loss of $4 million or six cents per unit for the same period in 2000. Profits of $166 million or earnings of $2.31 per stock unit for January-December, 2000, was against a loss of $15.3 million or 30 cents per stock unit in the same period of 1999.

This year's first quarter results show total revenue of $205.5 million, an increase of 14 per cent over the corresponding 2000 period. Of the total first quarter revenue, net premium accounted for $167 million, an increase of 77 per cent.

Island Life's balance sheet as at March 31, 200I, shows shareholders equity reaching $677.9 million, its highest in several years, representing an increase of 81.8 per cent from $372.9 million as at March 31, 2000.

Speaking to The Financial Gleaner about Island Life's strategies, which are contributing to the insurance company's resurgence to financial health, Mr. Fraser said, "Tight expense management and aggressive business acquisition."

In December 1999, Barbados Mutual Life Assurance Society acquired 64 per cent share of Island Life for J$260 million. But only recently, Barbados Mutual won the bid to acquire Milverton Reynolds' Life of Jamaica (LoJ) for a reported $2.047 billion.

Following the successful bid for LoJ, Barbados Mutual announced its intention to merge Island Life and Life of Jamaica leaving the business community to speculate as to who will be in control of the merged entity. Keeping his cards close to his chest about who would be president and chief operating office of Barbados Mutual Arthur Bethel said he was pleased with the track record of the two leading candidates and knew of no factors in their track record that might mitigate against their candidacy.

"As you know," Mr. Bethel said, "when Mutual purchased the interest in Island Life, we recruited Mike Fraser from Life of Jamaica and appointed him chief executive officer at Island Life and Mike has done a good job, he has got our business moving again," Mr. Bethel said, adding, "Life of Jamaica seems to be performing quite well." Mr. Bethel said he has met Mr. Reynolds and he is obviously a knowledgeable person in the industry, having been with Life of Jamaica for a number of years. He added that they would soon be in a better position to say who would be president of the merged entity.

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