The Argus Group has reported IFRS net income of $5 million for the six months ended September 30.

That result compares with $9.2 million in the prior year as restated for IFRS 17.

The company said this IFRS reported net income was impacted by one-off adjustments from the transition to IFRS 9 and 17, and exceptional costs arising from its proposed acquisition of a stake in BF&M.

Argus chief executive Alison Hill said: “There was good momentum in our business in the first half of the year, with insurance revenue increasing by 9 per cent, fee revenues rising by 16 per cent, and very strong operating cash flows.

“The business continues to deliver solid net operating earnings, even as claims costs continue to revert to longer term trend levels.”

Revenue for the period was $92.5 million, rising 9 per cent compared with the comparative period in the prior year ($84.9 million), driven by increases in both insurance revenue and fee revenues.

Insurance revenue increased by $7.5 million or 9 per cent.

Fee revenue was $24.8 million, an increase of $3.5 million or approximately 16.4 per cent over the prior year, driven by the continued growth in Argus’s medical practices.

Accordingly, the company said, operating cashflows were strong, with a net operating cash inflow for the six months of $22.4 million, compared with net inflow of $10.5 million over the same period last year.

Insurance service expenses increased by $10.3 million or 19.2 per cent compared with the prior year, mainly from increasing health claims costs which have continued to return to longer-term trend levels.

An Argus spokeswoman said: “We had a successful annual renewal of our health business and have won a number of attractive new clients, which will support our insurance performance looking forward.”

Net operating earnings for the period, reflecting the performance of the business excluding non-recurring expenses, were $8.7 million compared with $10.2 million for the comparative period in the prior year, Argus said.

Shareholders’ equity at September 30 was $154.2 million, an increase of 15.6 per cent over March 31 of $133.4 million, restated for IFRS 17.

Argus said the main driver of the increase was a redesignation of its interest accumulator portfolio to amortised cost, resulting in a one-time reversal of unrealised losses held.

The company’s share price on September 30 was $6.05 compared with $5.55 on March 31. Book value per share was $7.13 at September 30 compared with $6.20 at March 31 restated for IFRS 17.

Based on the group’s financial strength and performance, Argus said, it has declared an increased interim dividend of 12 cents per share for shareholders of record as of December 29, payable on January 26. This reflects a 9 per cent increase in the dividend compared with the same period in the prior year.

Ms Hill added: “Argus has changed dramatically over the past five years – we have successfully grown from being a focused insurer which offered protection products, to what is now a much broader customer-led business driving wellbeing of body and mind, of health and wealth.

“We will continue to focus resolutely on driving down costs whilst driving up quality of care in our health businesses, and more broadly, on acting as a powerful force for the wellbeing of our customers and community.”