By S BIRRUNTHA

LPI Capital Bhd posted a net profit of RM95.23 million in its fourth quarter ended Dec 31, 2020 (4Q20), an increase of 9.97% year-on-year (YoY) on higher gross premium income by its insurance unit Lonpac Insurance Bhd.

The group’s revenue grew 5.79% to RM422.38 million from RM399.26 million last year, mainly driven by a 6.7% growth in gross earned premium of RM25.4 million from its general insurance segment, its filing to Bursa Malaysia indicated.

Its earnings per share (EPS) rose to 23.9 sen in 4Q20 from 21.74 sen in 4Q19.

For the full year ended Dec 31 (FY20), LPI Capital’s net profit rose 4.46% YoY to RM336.73 million from RM322.36 million, while revenue grew 1.18% to RM1.62 billion from RM1.6 billion.

The group declared a second interim dividend of 44 sen per share for 4Q20 amounting to RM175.3 million, payable on March 1. This brought its total dividends per share declared for FY20 to 72 sen compared to 70 sen a year ago.

“Together with the first interim dividend of 28 sen per share amounting to RM111.5 million which was paid in August 2020, the proposed total dividend payout for FY20 is RM286.8 million, representing 85.2% of the group’s net profit attributable to shareholders and a 2.8% increase from the total payout of RM278.9 million made in FY19,” LPI Capital said in a statement yesterday.

The group said Lonpac’s claim incurred ratio improved during the quarter to 34.4% from 40.3%. With management expense ratio at 17.2% and commission ratio at 7.1%, Lonpac’s combined ratio moderated to 58.7% from 63.5% registered previously.

“As a result, its underwriting profit surged by 16.3% to RM112.7 million from RM96.9 million. Lonpac’s profit before tax for the quarter under review improved by 7.4% to RM124.1 million from RM115.5 million reported a year ago,” it added.

The group said its gross premium income increased 8.3% to RM343.1 million from RM316.8 million, while its net earned premium increased 2.8% to RM273 million.

Moving forward, LPI Capital chairman Tan Sri Dr Teh Hong Piow said 2021 will continue to be dominated by the Covid-19 pandemic and the global efforts to contain the infection.

“Our hope is that the rollout of several vaccines against the virus will prove fruitful and set us on the path to recovery.

“The global economy is expected to recover upon the successful containment of the virus which will be a positive catalyst spurring greater economic activities in Malaysia, which in turn will increase the demand for insurance products,” he added.

In light of the current challenging period, LPI Capital said it has taken all the necessary precautions to ensure operational continuity and safeguard the health and safety of its staff and customers.

“The need for digital transformation is further emphasised by the events of the year under review and we have accelerated our digital solutions to cope with the restrictions imposed by the Movement Control Orders,” he noted.

At close yesterday, LPI Capital’s share price ended 28 sen or 2.12% higher at RM13.46, valuing the company at RM5.36 billion.