Goldlink assure investors improved returns in 2010


-approves 0.2 Kobo for 2009


“Goldlink Insurance PLC was Incorporated with an authorised Share Capital of 5.3 Billion Naira with a fully paid-up of 5.1 Billion Naira. This, therefore, confirms that we are one of the highly capitalised Insurance Companies in Nigeria.


To enhance our efficiency and in line with modern technology, all operations of Goldlink Insurance is computerised at day one. This will enable us to be above peers and swiftly respond to our clients various and dimensional insurance problems. Our objective is to provide all services to with our commitment is second to none in Nigeria Insurance Market.


We are of the fact that claim is the ACID TEST of insurance competence and to this end, we maintain a department with experienced professional who have handled major losses in the industry, to resolve and claim within 48 hours upon full documentation”


(Source: Company’s Official Website)



In an interview session at the 17th Annual General Meeting (AGM) of Insurance Giants, Goldlink Insurance Plc today Thursday July 22 2010  at the Sheraton Hotel & Towers by PETER OBIORA of investadvocate in Lagos Nigeria, Femi Okunniyi, Managing Director/Chief Executive Officer (MD/CEO) of the insurance firm  discusses issues  relating to the 2009 year financial results of the company, its year 2009 share reconstruction, promise for a better dividend in the subsequent years to investors and strategies of achieving same.


Other issues discussed include, debt recovery, new products of Goldlink and the criteria for the company’s ‘A’ rating by Global Credit Rating (GCR), a renowned global rating agency; amongst other issues. Excerpts:


Activities of Goldlink in the review period


We want to thank God for having a good and successful Annual General Meeting (AGM) first and foremost, I want to congratulate every Shareholder, and this is a company that is growing.


In year 2008, our Premium Income was N3.471 billion; but in year 2009, it increased to N4.014 billion. Also, we paid total claims of about N1.0 billion in year 2008 and N1.4 billion in 2009 indicating a rise in total claim paid to 29 percent (29%). This payment was made to those who incurred one form of loss or the other. This suggests that Goldlink was able to revive their businesses and helped the economy to grow.


However, Profit after Tax (PAT) in year 2009 Financial Year End (FYE) dropped to about 85 percent (85%) which was as a result of some provisions made by the Regulators and this essentially was to take care of unpaid premiums and this is what we have done in year 2009.


It is more important that we are giving dividend to our Shareholders in the review period.




As contained in the company’s 2009 Annual Reports and Financial Statements, Gross Premium of the company increased by 41% in the review period from N3.471 billion in year 2008 to N4.014 billion in year 2009. Profit after Tax (PAT) declined from N406 million in year 2008 to N61 million in 2009 representing a decline of 85%.


Investors’ expectation for year 2010


We believe that our full year 2010, our profit will increase; we would work hard to make sure that this happens; we also will not look at year 2009 as our benchmark. For the half year result, there is quite an improvement both in Turnover and Profit After Tax (PAT). For year 2010, we are assuring our Shareholders to expect a very robust PAT and good dividend at the end of the year.




Without prejudice, as at the time of filling in this interview, investadvocate is yet to confirm or analyse Goldlink’s half year result for year 2010.


Strategies for ensuring a good dividend payment in future


Every company has a focus, and at the beginning of the year, we set up a lot of meetings and committees and our Management went on a retreat in order to strategise on things we will do to grow our income. In this retreat, we came up with long, medium and short term strategies that will make us to achieve all our set goals.


Even in the Nigerian economy, there are challenges with opportunities inherent in them. And we will take advantage of these opportunities. Apart from this, National Insurance Commission (NAICOM) has come up with a policy tagged Market Development Restructuring Initiative (MDRI) and there are some compulsory insurance policies we can make money from.


Recently in May 2010, Goldlink launched four (4) new products; which include Hotel and Hospitality Policy, Schools and Safety Policy, Travel and Tour Insurance and Goldlink Annuity Policies. All these are our initiatives to grow the Market. The Market can be grown with the introduction of new products which are tailor made to the needs of the people. We intend to use this to drive our income and certainly within the first half of the year, we have increased and improved our income; both in Turnover and Profit.




The four (4) new products launched by Goldlink include Hotel and Hospitality Policy, Schools and Safety Policy, Travel and Tour Insurance and Goldlink Annuity Product.


Again, we put a cost control mechanism in place which would be able to make us reduce our cost. When cost is reduced, profit goes up.


On the company’s bad debts


All these we are taking care of by setting up teams that are following up on collecting all our outstanding Premiums. Again, we must also thank the Regulators who now demand that a letter of confirmation must be given by the Underwriters in order to get their licenses renewed; and this policy has helped us in our business. Goldlink will follow up on this, like I earlier affirmed, we have formed teams working on recovering outstanding Premiums, this will definitely bring about an improvement in collected Premiums.


I wish to state that our debts are into categories, some of them are outstanding Premiums. Like I affirmed earlier, a taskforce has been set up and they have swung into action to recover our debts. Every two weeks, a Report is being generated to update us on the amount collected so far. This will help us generate more Investment Income. Right now, we are doing well in our core businesses by making sure that we have underwriting profits.




From the Balance Sheet of the company as at December 31 2009, Debtors and Prepayments rose from 1.293 billion in year 2008 to N1,405 billion in the review period indicating a rise of 8.66%.


On recovery of Premiums from Broker Debtors


This is an industry problem, there is no insurance company that you will go to and they tell you there is nothing like outstanding premium in their books. However, one of the ways NAICOM has put in place to correct this trend; is that they came out with a policy that after one year, if Premium is not paid, the insurance firm should make a 100 percent (100%) provision and this will affect the Balance Sheet of any Insurance Company and we have decided to pursue and recover every outstanding premium. We again go to the extent of finding out from the insured if they have paid to the Insurance Brokers, then we would take it up. If there is need for us to go to court, we would do that to get our premium.


However, some are living up to their responsibilities by making prompt and regular payments of Premium to Insurance Companies. In every industry, we have some bad people who spoil the image of the good ones.


I can affirm that what the Regulators are trying to do is to flush out the bad Insurance Brokers in the industry; so that honest companies can come in and do legitimate business.


Goldlink year 2009 share reconstruction and compensation to shareholders


We will look at the situation and know how to compensate the Shareholders of Goldlink. As a matter of fact, our Reserve is adequate to accommodate some of these concerns. It is from this Reserve that we are paying dividend for the year 2009 financial period. It depends on what the Board of Directors (BOD) agree upon, perhaps bonus maybe given, but I can assure that we want to be consistent in dividend payment and we are going to work on this in the current Financial Year.





Goldlink at an Extraordinary General Meeting (EGM) in the middle of year 2009 held in Lagos Nigeria adopted to reconstruct 099,894,000 issued and fully paid up shares of 50 Kobo each and thus reconstructed 1 for 2 shares of 50 Kobo each respectively previously held by shareholders.



The above was consolidated into 2,274,973,500 Ordinary Shares of N1.00 each. However, the consolidated 2,274,973,500 Ordinary Shares of N1.00 each was subdivided into 4,549,947,000 Ordinary Shares of 50 Kobo each.

And these shares were credited as fully paid and rank in pari-passu in all respects in the Capital of Goldlink.






Future share reconstruction


I cannot confirm this now; because decisions are based on situations and circumstances. For now, I don’t see any reason for reconstructing our shares; the one we did earlier we are taking good advantage of it and we believe that Shareholders should not be shortchanged. They must be able to reap good returns on their investments and this is our focus; to give the best in terms of returns to all the Shareholders that has invested into the company.


Criteria for Goldlink Global Credit Rating


As a matter of fact, Goldlink is an industry leader as at today, we are among the top 10 in the insurance industry and a Market leader. Other insurance companies emulate the kind of policies we churn out. In the motor insurance, we are number five (5) as far as our Market share is concerned. The major Oil Companies in Nigeria at this present time are being insured by Goldlink, they have confidence in our Policies and therefore accepts them.




Global rating agency, Global Credit Rating (GCR) awarded Goldlink an ‘A’ rating for the current year. GCR affirmed in the Report that Goldlink exhibits a significantly strengthened Balance Sheet with a sound international solvency margin.


GCR also in their Report also observed a display of robust underwriting margin coupled with the company’s impressive peer-to-peer rating which lent credence to the ‘A’  RATING OF Goldlink.


One of the major advantages that we have is bringing into our company over 20 professionals. We are one of the insurance companies in Nigeria that parades the best brains in the industry. Human Capital is very important in an organization and we have the right people that can drive the business and this has helped us as a company.







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