GENAC reports 36% decrease in nine months net profit attributable to shareholders

November 17, 2022

General Accident Insurance Company Limited (GENAC), for the nine months ended September 30, 2022, reported Gross premium written of $13.09 billion, 14% higher than the $11.50 billion reported for 2021. Excess of loss reinsurance increased to $200.34 million, from $155.47 million reported in 2021 while Reinsurance ceded slightly increased to $10.38 billion relative to $8.99 billion in 2021. As a result, net premium written increased by 7% from $2.35 billion last year to $2.51 billion in 2022. Net premium written for the third quarter amounted to $879.50 million relative to $821.18 million booked for the corresponding period in 2021.

Net changes in earned premiums totalled $6.43 million, relative to an unearned premium of $117.38 million recorded the previous year. Consequently, net premiums earned grew by 13% to a total of $2.52 billion compared to $2.23 billion for the same period last year. For the quarter, net premium earned totalled $909.38 million compared to $773.17 million booked for the similar quarter of 2021.

Commission income grew by 9%, year over year, from $709.97 million in 2021 to $774.55 million in 2022, while commission expenses went up by14% from $391.88 million in 2021 to $448.69 million in 2022.

Claims expenses saw an increase of 21%, closing the period at $1.40 billion (2021: $1.16 billion), also management expenses climbed by 20% to total $1.23 billion (2021: $1.03 billion).

There were no Net changes in commission recorded for the nine months compared to a loss of $19.94 million booked in 2021.

Consequently, underwriting profit for the period totalled $210.11 million, this compares to $344.68 million in 2021. The company made an underwriting profit of $202.15 million for the third quarter when compared to $175.72 million in 2021.

In addition, investment income closed at $250.27 million, a 70% increase when compared with last year’s $147.62 million, while other income totalled $27.30 million (2021: $71.97 million). Other operating expenses grew by 15% to $131.90 million when compared to $115.08 million in 2021.

As such, profit before taxation amounted to $354.57 million (2021: $441.94 million). Net Profit totalled $277.30 million for the period, a 21% decrease when compared to the $350.95 million reported last year, subsequent to tax charges of $77.28 million (2021: $90.99 million). However, net profit for the quarter was $260.11 million versus net profits of $176.59 million twelve months earlier.

Profit attributable to shareholders amounted to $257.11 million (2021: $399.16 million). While for the quarter, Profit attributable to shareholders closed at $206.15 million (2021: $196.80 million).

Total comprehensive income amounted to $240.78 million (2021: $433.57 million) year to date. While for the quarter, total comprehensive income amounted to $219.36 million (2021: $200.62 million).

As such, earnings per share for the period amounted to $0.25 (2021: $0.39) while EPS for the quarter amounted to $0.20 compared to $0.19 in 2021. The twelve months trailing EPS is $0.11. The number of shares used in our calculations amounted to 1,031,250,000 units. The stock traded at $4.71 as at November 16, 2022 with a corresponding P/E of 43.10 times.

The company states, “We continue to enjoy excellent growth in premium income across the region, primarily due to increase penetration of the broker markets in Barbados and Trinidad. Although we have not achieved the profitability targets in all regions, we remain committed to our growth plans and are confident that we will meet our strategic objectives.”

Balance Sheet at a glance:-

Total Assets increased by 15% to $12.92 billion as at September 30, 2022 from $11.19 billion a year ago. This was driven by the increase in ‘Other Receivables to total $1.16 billion (2021: $107.43 million). Also, ‘Due from Reinsurers and Co-Insurers’ contributed to the increase closing at $3.04 billion (2021: $2.00 billion).

Shareholder’s Equity as at September 30, 2022 stood at $2.85 billion (2021: $3.06 billion) resulting in book value per share of $2.76 (2021: $2.97).



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