CIC Insurance Group (CIC) underwent a significant restructuring exercise in 2023, resulting in a Sh275.65 million cost and a leaner, more technologically-driven workforce.

This strategic move coincided with the company achieving a record-breaking Sh1.44 billion net profit.

The restructuring program, announced in October 2023, offered voluntary exit and redundancy options to employees.

CIC spent Sh198.69 million in severance pay for those who opted to leave, with an additional Sh76.96 million earmarked for pending payments.

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"Restructuring costs payable relate to severance pay for employees who opted to retire/exit under the voluntary early retirement/exit programme in the year, and their payments are due in the subsequent year," CIC's recent annual report stated.

This initiative aimed to create a "leaner, flatter and more transparent" structure, as explained by CIC Group CEO Patrick Nyaga.

The goal was to streamline operations, eliminate redundancies, and enhance cost efficiency.

Despite the workforce reduction, CIC's employee count actually rose from 728 at the end of October 2023 to 793 by December of the same year.

This suggests that CIC may have filled the vacated positions while achieving its restructuring goals.

The company's total staff costs increased to Sh2.69 billion due to the severance payments, compared to Sh2.27 billion spent in the previous year with a smaller workforce.

The financial impact of the restructuring did not hinder CIC's profitability.

The company's 2023 performance marked its first full year under the new International Financial Reporting Standards (IFRS) 17 regulations.

While this resulted in a restated 2022 net profit of Sh157.14 million (down from the previously reported Sh1.09 billion), 2023's Sh1.44 billion net profit stands as a record for the company.

Building on this success, CIC has proposed maintaining a Sh0.13 per share dividend, amounting to Sh340 million, for shareholders on the group's register by the close of business on June 4th. The dividend payout is scheduled for July 8th, 2024.

CIC's strategic restructuring program demonstrates the company's commitment to both optimizing its workforce and achieving financial growth.

The success of this initiative, coupled with the record-breaking profit, positions CIC for a promising future.