Half Year 2025 Tower Ltd Earnings Call Transcript
Key Points
- Tower Ltd (ASX:TWR) reported a strong financial performance with an underlying profit after tax of $61.7 million, up from $36.6 million in HY24.
- The company declared a fully imputed half-year dividend of $0.08 per share, reflecting its commitment to rewarding shareholders.
- Gross written premium increased to $297 million, driven by growth in the New Zealand home and contents insurance portfolio.
- The BAU claims ratio improved significantly to 38%, attributed to favorable weather, easing inflation, and enhanced risk selection.
- Tower Ltd's focus on digital transformation and customer experience has led to a higher net promoter score of +41, up from +31 in HY24.
- Tower Ltd continues to face challenges with Canterbury earthquake claims, charging $6.2 million after tax in the half year due to new or reopened claims.
- The company is cautious about the pricing environment, noting a decrease in motor premiums larger than anticipated, impacting GWP growth.
- The proposed increase in the Natural Hazards Commission levy could undermine Tower Ltd's risk-based pricing efforts and increase insurance costs.
- The company's solvency ratio decreased to 164% from 212% in FY24, partly due to a capital return and changes in solvency calculation requirements.
- Tower Ltd faces ongoing customer remediation costs, with a $4.9 million charge after tax related to these issues in HY25.
Good day and thank you for standing by. Welcome to Tower Limited, half year results announcement 2025. At this time, all participants under the listen-only mode. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand the conference over to speaker today, Michael Stiassny, Chair of Tower. Please go ahead.
Thank you. Good morning. And thanks for making the time to join us for this investor call and presentation of our 2025 half year results. With me in Auckland is our interim Chief Executive Officer, Paul Johnston; and interim Chief Financial Officer, Angus Shelton. Tower's half year 2025 results demonstrate a business in good heart and performing strongly.
A razor sharp focus on profitable growth and operational excellence is creating value for our shareholders and will continue to do so. Earlier this year we delivered a capital return of $45 million that was value accretive, and today we are declaring a fully
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