BIHL braces for P110m hit as associate firms struggle

Letshego Headquarters. PIC: MORERI SEJAKGOMO
Letshego Headquarters. PIC: MORERI SEJAKGOMO

Botswana Insurance Holdings Limited (BIHL) expects to suffer a drop of up to P110 million for the half-year ended June 30, due to fair value reviews of investments in associate companies.

BIHL’s biggest stakes in other firms include 50% in Botswana Insurance Company, 36% in the Funeral Services Group (FSG), 25.1% in Malawi’s Nico Holdings Limited and about 26.2% in Letshego Holdings Limited.

Group executives previously told BusinessWeek that every six months, BIHL evaluates all its investments on the basis of a Discounted Cash Flow, which essentially attempts to measure the future returns on the different equity stakes. Recently, the group told shareholders that its interim results, due to be released on September 2, would carry a drop in pretax profits of between P78 million and P110 million when compared to the corresponding prior period. For the half-year ended June 30, 2018, BIHL posted pretax profits of P314 million.

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