FIRST Mutual Holdings Limited (FMHL) overturned a loss to post a profit after tax of US$6,2 million in its half year ended June 30, 2025, driven by insurance contract revenue, net investment returns and fair value gains on investment property. In the prior comparative period, the group had posted a loss of US$33 million. “The 2024 loss was largely non-operational in nature, driven by artificial losses on investment property.
Specifically, valuations by independent experts on January 1, 2024 did not fully adopt the official exchange rate due to its limited applicability in actual market transactions, leading to inflated opening balances that did not reflect true market asset values.” During the period under review, FMHL recorded a net insurance & reinsurance performance after investment return of US$16,27 million from a loss of US$19,5 million experienced in the comparative 2024 period. Insurance contract revenue for the period grew by 19% to US$87,74 million from the prior year comparative. This was driven by an increased uptake of the group’s insurance policies and upward reviews of sums insured on Zimbabwe Gold currency-denominated policies, implemented as a mitigatory response to value erosion.
Further, the net investment return was recorded at US$2,05 million, significantly higher than the prior year comparative of US$891 000. This growth was supported by relative stability in official exchange rates and the positive performance of the group’s Victoria Falls Stock Exchange-listed investment portfolios. “The group also recorded fair value gains on investment property of US$1 million, representing a 102% improvement from a loss position in the prior period,” Manzai said. “The contrasting performance between the two periods is attributed to significant valuation distortions on January 1, 2024 (effective date for transition to a USD functional currency), arising from compliance with functional currency transition guidelines under IAS 21 — The Effects of Changes in Foreign Exchange Rates.” The group’s balance sheet also strengthened as total assets ended the period at US$266,76 million, up from the end of last year’s US$256,8 million comparative.
