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Suncorp Group fiscal H1 net profit drops YOY

Suncorp Group Ltd. posted a year-over-year decline in net profit for the fiscal first half ended Dec. 31, 2017.

The group's net profit attributable to owners for the first half declined to A$452 million from A$537 million in the prior-year half. EPS for the period declined to 34.66 cents from 41.13 cents.

Meanwhile, the group's cash earnings fell 19.2% year over year to A$472 million, or 36.11 cents per share, from A$584 million, or 44.61 cents per share.

The S&P Capital IQ consensus normalized EPS estimate for the half was 43 cents, with four analysts reporting.

Suncorp's insurance business contributed net profit after tax of A$264 million, down from the prior-year net profit of A$369 million.

Insurance premium income stood at A$5.27 billion as of Dec. 31, 2017, compared with A$5.17 billion in the prior-year half.

Gross written premium inched 0.7% to A$4 billion from A$4.03 billion. Net earned premium increased to A$3.64 billion from A$3.55 billion in the prior-year period.

As of Dec. 31, 2017, the combined operating ratio stood at 96.0%, up from 92.9% as of June 30, 2017, and from 87.1% as of Dec. 31, 2016.

The company's banking and wealth business's net profit after tax fell to A$197 million from A$208 million.

Net interest income increased to A$598 million from A$558 million. The net interest margin stood at 1.86%, compared with 1.87% as of June 30, 2017, and 1.78% as of Dec. 31, 2016. Net interest margin of 1.86% remained strong supported by asset repricing and efficient funding.

The common equity Tier 1 ratio fell to 9.01% as of Dec. 31, 2017, from 9.20% as of Dec. 31, 2016.