SINGAPORE (Feb 13): Great Eastern Holdings has declared an 11% decline in 4Q16 earnings to $195.2 million, mainly due to lower operating and non-operating profit brought about by unrealised fair value losses from the valuation of assets and liabilities.

This brings the group’s earnings for FY16 to a total of $589.3 million, down 25% from $785.4 million a year ago. Additionally, its FY16 earnings were affected by a one-off loss of $18.7 million from disposal of its wholly-owned subsidiary, Great Eastern Life (Vietnam) Company.

Operating profit fell on a quarterly basis by 33% to $112.5 million while full year operating profit fell 13% to $581.4 million respectively, which the group attributes to “new business strain from higher sales growth and medical claims in the Singapore operations” for the full year.  

Non-operating profit registered a 74% decline to $12.7 million in 4Q16 from $48.9 million a year ago. For FY16, the group posted $48.5 million in non-operating losses as compared to non-operating profit of $2.5 million in FY15.

The group also notes lower operating profit contribution its Singapore business for the full financial year as compared to FY15, where its performance in the previous financial year was boosted by a $119.9 million gain from the sale of the group’s investment in New China Life Insurance Company.

Total Weighted New Sales (TWNS) for the quarter rose 13% to $345.5 million from $304.4 million in 4Q15.

Notably, the group’s TWNS for FY16 grew 11% to $1.1 billion, which Great Eastern attributes mainly to strong contributions from both agency and bancassurance channels.

New Business Embedded Value (NBEV), a measure of long-term economic profitability, recorded a 30% growth in 4Q16 to $145.5 million and also registered a 22% increase to $466.2 million over the financial year.

The group’s directors recommend a final dividend of 40 cents per ordinary share, which is subject to shareholders’ approval at its AGM, after which it will be payable on May 8 this year.

Including the 10 cents per share dividend which was paid in Sept 2016, total dividends for FY16 would amount to 50 cents per ordinary share.

Shares of Great Eastern closed 1.4% higher at $21.10 on Friday.