Sunday, April 21, 2019

First Mutual loses 3 Million due to foreign currency crisis

Finance services company First Mutual Holdings Limited has lost foreign business worth up to US$3million in the past few years due to the lack of foreign currency in Zimbabwe, a senior company official has said.

Group Chief Executive Office, Douglas Hoto, said they have had to move some of their regional business to Botswana in order to keep their business afloat.

“We lost the foreign business in Zimbabwe because of the difficulties in paying claims in Zambia and East Africa but we managed to retain most of that through our Botswana business,” Hoto said

“We used to make about US$3,5 million three years ago but we were now making just about $US500 000,” he added.

Hoto said the First Mutual shareholders have however benefited from the arrangement as they now get dividends in foreign currency which is elusive in Zimbabwe.

“The Botswana company pays a management fee to our business in the country. Secondly it pays a dividend and in the year ended (31 December 2018) the dividend was US$250 000.

First Mutual Holdings recorded a US$17.6 million profit as at 31 December 2019 an increase from the US$12.2 million profit in 2017 attributed to a 45% growth in revenue.

They have merged their insurance company Tristar to their recent acquisition, Nicoz Diamond in order to establish a foothold in the insurance market.