Tower Limited has set the foreign exchange rate for its final FY25 dividend to Australian shareholders and issued new long-term incentive share rights, following a year of higher profit and premium volume.
On Nov. 27, 2025, Tower declared a fully imputed final dividend for the year ended Sept. 30, 2025, of 16.5 New Zealand cents per share. The board also approved a supplementary dividend of 2.911765 New Zealand cents per share for non-resident investors. The insurer has now set the foreign exchange rate that will apply for Australian investors receiving the dividend in Australian dollars. The conversion rate is A$0.84944500 per New Zealand dollar, with payment scheduled for Jan. 29. Including the final payout, Tower’s total dividends for FY25 amount to 24.5 New Zealand cents per share. The setting of the FX rate formalises the amount that Australian and other trans-Tasman investors in Tower will receive in Australian dollars from the New Zealand-based general insurer.
In a separate move, Tower has granted additional equity-based awards under its long-term incentive plan (LTIP). A capital change notice filed with NZX on Jan. 21 records the issue of unquoted share rights over 1,029,302 ordinary shares to employees. The share rights are issued for no cash consideration and represent 29.21% of the relevant class of unquoted share rights on issue. Following this grant, the total number of share rights in the class is 4,552,520. Each share right is structured to convert into one fully paid ordinary share in Tower if vesting conditions are met. Conversion depends on Tower’s total shareholder return over a three-year period to Dec. 11, 2028, relative to entities in the NZX 50 index, and requires total shareholder return to be positive over that period.
The share rights do not carry voting or distribution rights before vesting and conversion, cannot be transferred or used as security, and do not provide beneficial or legal ownership in existing shares. Vesting is also conditional on continued employment. The issue was approved by the board under NZX Listing Rules 4.6.1 and 4.9.1(b). The rights were granted with an issue date of Jan. 20, and the announcement was authorised by Tower chair Michael Stiassny. Tower said the LTIP issue is “to incentivise and retain employees,” with the structure intended to link employee incentives to shareholder returns over the vesting period.
The dividend and LTIP grants follow Tower’s full-year result released on Nov. 27, 2025, in which the insurer reported growth in both underlying and reported profit for FY25. Underlying net profit after tax (NPAT) rose to NZ$107.2 million from NZ$83.5 million in FY24, while reported profit increased to NZ$83.7 million from NZ$74.3 million. Gross written premium (GWP) reached NZ$600 million, a 2% increase year on year. Customer numbers grew 4% to 318,000. The business-as-usual claims ratio declined to 41% from 48%, and the combined operating ratio moved to 74.1% from 79%. Tower’s management expense ratio remained at 31.4%. Tower said the profit outcome reflected lower large-event costs, a lower underlying claims ratio, and growth in the customer base. Reported profit included adjustments for updated Canterbury earthquake claims estimates, customer remediation costs, and a provision for software impairment.
Commenting on the FY25 result announcement, Chief executive Paul Johnston said: “This is an exceptional result, underpinned by Tower’s transformation, driven by investment in our digital platform and continued focus on underwriting discipline, technology, data, and efficiency. These actions demonstrate Tower’s commitment to delivering sustainable growth and building a resilient, customer-focused business for the future. However, it is worth noting that we expect conditions that influenced the FY24 and FY25 results, such as relatively benign weather, and prior-year rating flowing through the portfolio, to normalise in [2026].”
For FY26, Tower has guided to underlying NPAT in the range of NZ$55 million to NZ$65 million, based on an assumption of full utilisation of its updated NZ$45 million large-event allowance. The company expects GWP growth between 5% and 10%, linked to customer growth and distribution arrangements. Tower has entered into a new agreement with Westpac New Zealand under which it will provide general insurance products to the bank’s retail customers from July 2026. The insurer also reported ongoing marketing and brand activity, including a revised brand platform and a national advertising campaign. Tower said it expects efficiency gains from digitisation and process changes in the coming year but indicated that continued investment in technology, growth initiatives, and customer-facing capabilities is likely to keep the management expense ratio in the range of 31% to 32% in FY26.
