Kenya Reinsurance Corporation Limited (Kenya Re) will have its profits dipping by over 25 percent, as compared to 2017 earnings.
Issuing a profit warning to shareholders, company secretary Charles Kariuki attributed the slump to high claims, forex losses due to currency devaluations in some markets where it operates, an unexpected reduction in income from associate and impairment on the asset held for sale.
“Based on the preliminary assessment of the unaudited accounts, the net earnings of the corporation for the financial year ended December 31, 2018, are likely to be more than 25 percent lower than those reported for the financial year December 31, 2017,” said Charles Kariuki, Company Secretary.
The company recorded 9 percent growth in net profit to Ksh 3.5 billion in the year ended December 31, 2017. Its asset base also increased from Ksh38.4 billion in December 2016 to Ksh42.7 billion.
The company has been experiencing stiff competition from new entrants, with its market share shrinking every year.
As a way of trying to counter the same, the company had announced plans to buy shares from national reinsurance companies, but the plans seem to have come to a halt as it went mute.