- Health insurance provider nib (NHF) has told shareholders it is expecting to profit over $200 million for the full 2020 financial year
- The company suspended its annual guidance last year in light of the uncertainty brought about by COVID-19
- However, nib told shareholders today its Australian Residents Health Insurance (ahri) business has been performing well and offsetting weakness in its international health insurance and travel insurance arms
- In light of this, nib has tabled $140.9 million in group underlying operating profit (UOP) for the first nine months of the 2021 financial year
- Moreover, the company now expects full-year profit to land between $200 million and $225 million for the financial year
- nib said it will begin to increase its investment in marketing, growth projects and other areas of business transformation projects
- Shares in nib closed 10.2 per cent higher this afternoon at $5.94 per share
Health insurance provider nib (NHF) has told shareholders it is expecting to profit over $200 million for the full 2020 financial year.
The company suspended its annual guidance in 2020 as COVID-19 sent jitters through the local and global economy and health insurance claims rose. However, nib said today it has a better idea of how the rest of the year might look.
nib said its Australian Residents Health Insurance (ahri) business is performing well, with total policyholders at 641,804 at the end of March 2021 — a rise of 3.7 per cent compared to the end of June last year.
At the same time, nib said, claims experience is continuing to be lower than expected. In fact, the company said its ahri performance is strong enough to be “more than offsetting” COVID-19-induced weakness across its international health insurance and travel insurance businesses.
In light of this, nib has tabled $140.9 million in group underlying operating profit (UOP) for the first nine months of the 2021 financial year.
The company said its COVID-19 provision for deferred and suspended claims over this time period was $59 million compared to the $70.7 million for the first half of the 2021 financial year.
As such, while nib admitted forecasting claims experience is still “problematic” as the threat of COVID-19 outbreaks looms, the company said it now expects full-year UOP to land between $200 million and $225 million. This is on the back of a UOP result of $86.9 million for the first half of the financial year.
This updated profit guidance comes even though nib said the extent of the expected “catch-up” in deferred healthcare treatment during the March quarter of the 2021 financial year was lower than the company predicted it would be in December 2020.
Given the strong ahri performance, nib said it will begin to increase its investment in marketing, growth projects and other areas of business transformation projects.
Investors responded well to nib’s business update today, with the company closing 10.2 per cent higher at $5.94 per share this afternoon. nib has a $2.72 billion market cap.