Insurance firm Tower has reported an 87% rise in half year profit after selling $181 million worth of businesses to focus on general insurance.
After making adjustments for the sale of its businesses, the company says its profit after tax for the six months to the end of March was $44.2 million compared with $23.6 million in the same period last year.
The company has sold its health insurance and funds management businesses, the gains from which are included in the result. The sale of its life insurance business is still subject to regulatory approval.
In total, the sales will release $370 million of which $120 million has already been distributed to shareholders and a further $114.5 million will be distributed once the sale of its life business is completed.
Following the changes, Tower will operate as a general insurance business.
It made a profit of nearly $6 million for the half year from this arm, but that was hit by a $14.2 million increased provision for the February 2011 Christchurch earthquake.
The group's managing director, Rob Flannagan, says the sale of its business has been a driver behind the group results, while general insurance had a solid performance.
Tower says it's considering de-listing from the Australian stock exchange as it becomes a smaller company following the sales.
The company declared a steady first-half dividend of 5 cents a share, and says the new-shaped business will adopt a dividend payout policy of 90% to 100% of net profit.
