GENAC reported a 75% decline in net profit for the nine months ended September 2017

General Accident Insurance Company Limited (GENAC)

For the year ended September 2017:-

GENAC reported Gross premium written of $6.18 billion, 18% higher than the $5.23 billion reported for 2016. As a result, net premium written increased by 18% from $886.26 billion last year to $1.04 billion. Excess of loss reinsurance trended down by 1% to $70.38 million (2016: $70.94 million). Net premium written for the third quarter amounted to $369.96 million relative to $300.97 million booked for the corresponding period in 2016.

Reinsurance ceded amounted to $5.07 billion relative to $4.27 billion in 2016, a 19% increase year over year.

Net changes in unearned premiums totaled $78.18 million, 142% higher than the $32.28 million recorded last year. Consequently, net premiums earned grew by 13% to a total of $965.12 billion compared to $853.98 billion for the same period last year. for the quarter, net premium earned totaled $347.35 million compared to $312.92 million booked for the similar quarter of 2016.

Commission income grew by 16%, year over year, from $282.31 million in 2016 to $328.66 million in 2017, while commission expenses increased by 15% from $205.79 million to $236.04 million.

Claims expenses saw an increase of 30%, closing the period at $788.15 million (2016: $607.22 million), while management expenses climbed by 22% to total $409.56 million compared to the 2016 total of $335.58 million. Net change in commission totaled $105.15 million for the nine months compared to $5.72 million booked in 2016.

Underwriting loss for the period totaled of $34.83 million, this compares to a loss of $6.58 million in 2016. The company however made an underwriting profit of $33.15 million (2016: $36.48 million).

Investment income closed at $146.33 million, a 56% decline when compared with last year’s $335.40 million, while other income totaled $1.95 million, (2016: $3.53 million). Other operating expenses grew by 8% to $22.41 million relative to $20.69 million in 2016.

Profit before taxation amounted to $91.04 million (2016: $311.66 million). Net Profit totaled $76.78 million for the period, a decline of 75% compared to the $311.60 million reported last year, following tax charges of $14.26 million. Net profit for the quarter was $68.44 million a 72% less than the same period of 2016 which had net profits of $243.41 million.

Total comprehensive income amounted to $130.42 million (2016: $311.60 million), following a gain on available investments for sale of 53.64 million.

As such, Earning per share for the period amounted to $0.07 (2016: $0.30) while EPS for the quarter amounted to $0.07 compared to $0.24 in 2016. The twelve months trailing EPS is $0.15. The stock traded at $2.70 as at November 14, 2017. The number of shares used in our calculations amounted to 1,031,250,000 units.

Balance Sheet at a glance:-

Total Assets increased by 10.17% to $5.37 billion as at September 2017 from $4.88 billion a year ago.

Shareholder’s Equity as at September 2017 stood at $1.89 billion (2016: $1.89 billion) resulting in book value per share of $1.84 (2016: $1.84).





Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.

Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.