Thursday 25 February, 2016
2015 Results - Chairman’s Press Statement
At its meeting today the NASFUND Board considered and accepted its audited financial accounts for the 2015 financial year. Chairman William Lamur, on behalf of the Board stated that the results were positive in yet another challenging year. External factors such as slowdown of the global economy and significant fall of commodity prices impacted revenue streams of PNG based companies in which the Fund had investments in. In addition, aside from the effect of El Nino and limited access to foreign currency, surplus of quality property buildings and the lack of a secondary market for fixed interest securities trades, resulted in valuation losses in Equities and bonds. Chairman Lamur stated that Fund had demonstrated a strong resilience to attain positive outcomes with an over budgeted performance in cash returns from its investments and controlled expenses.
Against this back drop the highlights of 2015 are follows:
- Gross Asset Value of K 4.07 billion representing a growth of 7.2 % from K 3.795 billion recorded in 2014.
- Net Asset Value of K 3.936 billion representing a growth of 5.8 % from K 3.719 billion recorded in 2014.
- Cash Income of the Fund grew from K 207 million in 2014 to K 257 million.
- Valuation losses of K 18 million compared to valuation gains of K 75 million in 2014.
- Prudent management resulting in 2% savings of operating expenses compared to 2014.
- Surplus after tax of K 150.9 million compared to K258.46 million achieved in 2014.
- A 5.6% increase in total membership to 515, 535 from, 488,346 members recorded in 2014.
- Active employer base of 2,409 establishments representing a 12 % growth compared to 2,150 active employers in 2014.
- Contribution receipts of K 473 million representing a growth of 3% from K 459 million recorded in 2014.
- 773 educational & public awareness shop floor presentations to employers & members throughout the country compared to 736 presentations conducted in 2014.
- Payment of over K 407 million in superannuation entitlements including housing advances representing 68,994 transactions to members or their beneficiaries.
- The re -opening of Kavieng branch.
- Reduced turnaround times to 7 days for clean applications.
- Automation of Partial Withdrawals.
- Significantly reduced queues at Lae and Boroko branches through segmentation of processing days.
- Better management of liquidity to ensure withdrawing members were paid their rightful entitlements.
- Completion of phase 1 of a new ERP platform to upgrade our core business and financial systems.
- Decisions on new investments in property and equities totaling over K 271 million.
- Investments in Fixed Income (Treasury Bills, Government Inscribed Stocks) of K 723 million.
- Ongoing education process for members to understand the importance of long term savings to provide for comfortable living in the later years of life after active employment.
On the back of these achievements the Board approved a crediting rate of 4 % equating to over K 144 million to be paid to members’ accounts for the 2015 Financial year. The Board further agreed to hold reserves of K 75 million or 1.9% of members funds as a matter of prudency.
Looking ahead in 2016, Mr Lamur reminded members that their NASFUND savings were for the long term. What is happening now is a timely reminder of the importance of having an appropriate strategic asset allocation and risk management plan in place to mitigate short term shocks. While annual returns from the investment portfolio are subject to market forces and vary from year to year, real returns after inflation to member accounts increase significantly over a longer period through the effect of compound interest and a dedication to investing in assets that provide secure long term returns.
“Above all, striving to be better than we are now will serve members interests and that is what we are all about” Mr Lamur said.
On this note I would to sincerely thank our CEO Ian Tarutia, management and staff of NASFUND for their commitment and hard work over 2015 in delivering these results.
Authorised by William Lamur OBE, Chairman
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