Tower lifts FY25 earnings guidance amid strong business performance

Kiwi insurer Tower (ASX:TWR) has updated its earnings guidance for the fiscal year ended Sept. 30, 2025.

The company now projects that its full-year underlying net profit after tax (underlying NPAT) will range between NZ$60 million ($54.2 million) and NZ$70 million ($63.2 million), an increase from the previous forecast of NZ$50 million ($45.2 million) to NZ$60 million 9$54.2 million).

This projection assumes full utilisation of a NZ$50 million ($45.2 million) large events allowance.

Tower has experienced only one significant event this fiscal year, the Dunedin flooding in October, which had an estimated cost of around $3 million.

The revised NPAT guidance is attributed to strong business performance in the first quarter and positive early signs from January.

Key factors include improved business-as-usual claims performance due to benign weather conditions, easing inflation, fewer total loss house claims, and enhanced risk selection.

Gross written premiums guidance has been adjusted to 7%-12%, lower than the previous 10%-15% range.

The combined operating ratio guidance has also improved, expected to be between 84% and 86%, down from the earlier range of 87% to 89%.

Tower noted that the reduction in average premiums, resulting from higher proportions of lower risk new house and motor policies, has impacted GWP growth.

Further details will be shared at Tower's annual shareholder meeting on Feb. 11.