CliEntèlE rEports DouBlE-DiGit profit risE

JOHANNESBURG – JSE-listed financial services group Clientèle has reported a double-digit climb in profits for its half-year to end-December, saying on Monday SA’s weak economic conditions hadn’t derailed demand for funeral coverage.

Net profit rose 15 per cent to R254.7 million in the six months to end-December, the company said on Monday, reporting higher-than-expected policyholder withdrawals, though it still got a boost in its funeral business.

Valued at R3.48 billion on the

JSE, Clientèle Life’s Long-term insurance segment remains the major contributor to the group’s performance. Due to the contribution from the good quality funeral parlour intermediated business, it recorded a 16 per cent increase in net profit for the period to R180.8 million, the company said.

Profits

Due to a high client affinity within the funeral parlour industry and corresponding lower withdrawal experience in this business, a portion of future funeral parlour business profits have been recognised during the period as a result of not

eliminating negative reserves, resulting in an increase in profit after tax of R51.6 million.

In its short-term insurance business, Clientèle Legal’s net profit for the period fell 26 per cent to R45.1 million.

High withdrawals were the result of many factors, the company said, including the depressed economy and the consequent affordability effects, coupled with ongoing challenges in the collections environment.

The company has said previously it has faced challenges with policyholders disputing valid debit order collections from their bank accounts, in order to ‘manage their cash flow’.