Tower New Zealand Profit Rises on Health Insurance

Tower Ltd. (TWR), New Zealand's third- biggest fund manager for individuals, said first-half operating profit rose 44 percent on increased health insurance income.

Earnings rose to NZ$15.7 million ($11.5 million), or 8.3 cents a share, in the six months ended March 31, from NZ$11.4 million, or 5.8 cents, a year earlier. Net income soared to NZ$214.5 million after a one-time gain from separating Tower Australia Group Ltd., the Auckland-based company said today.

Operating profit from health insurance for individuals jumped 29 percent to NZ$3.1 million as Tower increased prices.

Chief Executive Officer Robert Flannagan spun off Tower's Australian unit during the half into a new company called Tower Australia Group Ltd., earning a NZ$199 million one-time profit.

Shares of Tower rose 1 cent to NZ$2.34 at the close of trade in Wellington. The stock has fallen 11 percent in the past year, the fourth-worst performer in the 14-member MSCI New Zealand Small Cap Index.

Tower won't pay a first-half dividend.

-- Editor: Underhill (bam).

To contact the reporter responsible for this story: Jonathan Underhill in Wellington on junderhill@bloomberg.net

To contact the editor responsible for this story: Peter Vercoe pvercoe@bloomberg.net

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