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Insurer Tower's full year net profit is little changed from the year earlier as provisions for the Canterbury continue to hit its bottom-line.
Key numbers for the 12 months ended September compared with a year ago:
- Net profit $18.8m vs $18.7m
- Revenue $441.5 vs $428.2m
- Underlying profit $27.3m vs $20.8m
- Full year dividend 6.5 cents a share vs 5 cps
"This strong result is underpinned by our strategy of delivering simple and rewarding customer experiences combined with our advanced technology and digital and data capability," chief executive Blair Turnbull said.
"The decisive actions taken to combat record inflation, global supply change blockages, and increasing frequency and severity of large events together with consistent growth and strong underlying business performance, have delivered a strong result for shareholders."
Reported profit was hit by a $5.5m after-tax cost related to a strengthening of the residual Canterbury earthquake provision.
As well the company had set aside provisions of $2.6m after tax for customer remediation associated with some overcharging of customers.
Turnbull said all three of the company's business units had reported a strong performance.
Large insurance events added $19m to claims costs for the 2022 financial year compared with $13.9m in FY21.
These included the recent Tongan volcanic eruption and subsequent tsunami, as well as multiple storms and floods across New Zealand.
"Tower continues to take decisive action to address the increasing severity and frequency of extreme weather events," Turnbull said.
Actions would include future-proofing Tower's underwriting capability by expanding risk-based pricing to inland flooding in FY22 and coastal hazards in FY23.
As a result Tower increased its perils allowance by 50 percent to $30m in the current year.
"The successful renewal of Tower's reinsurance programme with $934m of catastrophe cover will also provide important protection from this volatility," he said.