Britam to lay off 100 in cost cutting

Britam Group chief executive officer Benson Wairegi. FILE photo | nmg 

By BRIAN NGUGI

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Summary

• Britam said on Wednesday that it was implementing an early retirement plan mean to enable the firm “to remain agile, relevant and responsive to the changing market conditions.”
• Early this year Britam issued a profit warning for the year ended December 2017, becoming the ninth publicly traded firm to anticipate an earnings decline of at least 25 per cent.

Financial services group Britam is set to lay off 100 staff in a bid to cut costs.

The firm said on Wednesday that it was implementing an early retirement plan mean to enable the firm “to remain agile, relevant and responsive to the changing market conditions.” Its financial advisors will not be affected, it added.

“The early retirement is part of our business realignment process that focuses on building and growing market leadership through greater efficiency driven by innovation and technological advancement,” said Britam Group managing director Benson Wairegi in a statement.

Mr Wairegi did not respond to queries on sendoff packages, the criteria of the retirement plan as well as how much it will cost the company.

Early this year Britam issued a profit warning for the year ended December 2017, becoming the ninth publicly traded firm to anticipate an earnings decline of at least 25 per cent.

The firm said at the time that its net profit for the period would drop from the Sh2.4 billion it reported in the previous year, which benefited from the adoption of a new valuation system that depressed its liabilities.

READ: Britam now ninth NSE-listed firm to issue profit warning

The absence of the one-time valuation changes will see the company’s earnings fall by at least a quarter in the review period.

“The board of directors... wishes to inform shareholders of the company… the earnings are expected to decrease by at least 25 per cent compared to the same period in 2016,” the insurer said in a statement on January 5.

“The expected decline in earnings is mainly due to a change, in 2016, of the valuation method of the long term liabilities to the gross premium valuation (GPV) methodology from the previously applied net premium valuation (NPV).”