KUALA LUMPUR: LPI Capital Bhd announced a net profit of RM344.7mil in the financial year ended Dec 31, 2021, was 2.4% higher compared to RM336.7mil in 2020 on the back of higher revenue.

       The group said topline for the financial year increased to RM1.72bil from RM1.62bil due to higher gross earned premium, which made up 93.8% of the total operating revenue.

       “Despite the various challenges encountered, triggered mainly by the prolonged pandemic, the LPI Group remained resilient and continued to report satisfactory performance in FY2021," said group chairman Tan Sei Teh Hong Piow in a statement.

       He added that in view of the performance, the board has declared a second interim dividend of 45 sen per share, amounting to RM179.3mil.

       This brings the total payout for 2021 to 74 sen per share or RM294.8mil, representing 85.5% of the group's net profit attributable to shareholders and 2.8% more than the payout in 2020.

       The improved annual performance came despite a lower net profit of RM73.1mil in the fourth quarter of the year, which was 23.2% less than RM95.2mil in the same quarter of the previous year due mainly to an increase in insurance claims.

       Revenue for the quarter however was RM429mil, which was 1.6% higher than in the same quarter in 2020.

       "For the 4th Quarter of FY2021, the performance of the LPI Group was affected by the normalisation of claims ratios with the easing of the lockdowns and the re-opening of the economy.

       "The year-end flooding disaster and lacklustre performance of the Fixed Income Unit Trusts had also contributed to the lower profit of the Group," said Teh.

       For the quarter under review, the group's insurance arm Lonpac Insurance Bhd reported an increase in claims incurred ratio of 37.7% from 34.4% in the previous corresponding quarter.

       Lonpac said all major classes of insurance reported an increase in their claims incurred ratio while it received more than 1,300 flood claims intimations as at 31 December 2021.

       Coupled with its management expense ratio and commission ratio, Lonpac recorded a combined ratio of 62.8%, which was up from 58.7% in the same quarter in 2020.

       This led to a 15.4% drop in underwriting profit to RM95.3mil over the year.