Life of Jamaica president Richard Byles (left) and chairman Dodridge Miller are seen here in July 2005 at LOJ's annual general meeting in Kingston. - File

Market leader Life of Jamaica (LOJ) has posted strong third quarter results of $722 million, or 50 per cent growth in net profits relative to the 2005 quarter, equivalent to 16 cents per share attributable to shareholders.

Gross premium revenues for the quarter were up $970 million to $3.09 billion, the largest contri-butor to the $3.76 billion of net revenues.

Net investment income was virtually flat at $741 million in the last quarter, but was up $60 million over nine months to $2.28 billion (September 2005:$2.22 billion).

But the insurance company, in its full nine months to September 30, actually saw a $100 million dip in net earnings to $2.14 billion (2005:$2.24b) and a 10 cent fall in earnings per share to 48 cents. Profits attributable to shareholders topped $1.77 billion.

Last year's nine-month results, however, were boosted by LOJ's booking of a one-time $430 million gain from the sale of 197 million shares formerly held by PanCaribbean Financial Services in First Life to Barbadian parent Sagicor Financial Corporation, offsetting debt incurred by the Jamaican life insurance company to acquire 226.2 million of PCFS shares.

"With the exclusion of the 'one-time' gain of $430 million from the sale of shares to the ultimate parent, the 2005 profits attributable to shareholders would have been $1.49 billion," said an explanatory statement from chairman Dodridge Miller and president Richard Byles accompanying the financials filed with the Jamaica Stock Exchange.

19 per cent improvement

"The January to September 2006 performance is, therefore, a 19 per cent improvement on the normal results for the previous year and represents an annualised return of 19 per cent on shareholders equity," it said.

Over the current nine-month period, LOJ had strong growth in gross premiums to $8.7 billion - 54 per cent above the relative 2005 period and $700 million ahead of premium income recorded for the full 12 months of last year - but its reinsurance costs zipped to $1.4 billion, four times the $319 million it shelled out the year prior period to cover some of the risk for the policies it writes.

The result was net revenues of $7.3 billion, which was $160 million short the full 2005 year.

Total revenues inclusive of fees, commission and investment income grew $1.9 billion or 21 per cent to $10.93 billion (2005:$9.04b). But sales gains were eroded by reinsurance costs, payouts of insurance benefits of $3.7 billion, operating and administrative expenses, plus sales commissions and other charges - totalling $8.3 billion combined - for nine-month pre-tax profits of $2.66 billion.

Jamaica brought in $9.43 billion of the business done by LOJ over the nine months of 2006, while Cayman, which is one-tenth the size measured in totals assets of $78.98 billion (2005:$67b), accounted for $1.4 billion or 14 per cent of gross revenues, relative to a 5.8 per cent contribution in the 2005 period.

The Cayman operation, Cayman General Insurance, was rebran- ded Sagicor General Insurance (Cayman) Ltd.

"The rebranding marks the new controlling ownership and aligns the company's image with the highly respected Sagicor brand," said the company.

"The group performance to date has been strong and management remains optimistic about the expected outcome for the full year 2006."

LOJ traded up 25 cents on Monday to $8.00.

business@gleanerjm.com.