GENAC reports 53% decrease in net profit attributable to shareholders

May 14, 2021

General Accident Insurance Company Limited (GENAC) for the three months ended March 31, 2021, reported gross premium written of $3.30 billion, 30% over the $2.54 billion reported in 2020. Reinsurance ceded rose 34% to close at $2.42 billion relative to $1.81 billion booked in 2020. Excess of loss reinsurance trended upwards by 26% to $49.12 million (2020: $39.02 million).

As a result, net premium written increased by 21% from $689.13 million for the first quarter of 2020 to $830.70 million for the three months ended March 31, 2021.

Net changes in unearned premiums totalled $111.77 million, 494% more than the $18.82 million recorded last year. Consequently, net premiums earned grew by 7% year over year to a total of $718.93 million compared to $670.30 million for the prior year.

Commission income rose 22%, year over year, from $173.34 million in 2020 to $210.80 million in for the three months ended March 31, 2021, while commission expenses grew 60% from $84.98 million in 2020 to $135.79 million for the first quarter of 2021.

Claims expenses increased by 1% closing the quarter at $454.12 million (2020: $447.53 million), while management expenses climbed 17% to total $313.53 million compared to 2020’s total of $268.31 million.

Underwriting profit for the quarter amounted to $26.29 million, this compares to a profit of $42.83 million booked for the first three months of 2020.

Investment income closed at $48.86 million, a 1% decrease when compared with last year’s corresponding quarter of $49.57 million. Other loss for the quarter was $1.53 million for the quarter, relative to other income of $24.11 million in 2020. Other operating expenses grew by 53% to $36.31 million relative to $23.75 million in 2020.

Profit before taxation amounted to $34.61 million (2020: $91.34 million). Following taxes of $19.09 million (2020: $16.62 million), net profit totalled $15.52 million for the quarter, a 79% decline when compared to the $74.72 million reported for the previous year’s comparable quarter.

Total comprehensive income for the quarter amounted to $15.66 million relative to a total comprehensive income of $68.35 million for the quarter ended March 31, 2020.

As such, earning per share for the period amounted to $0.015 (2020: $0.072). The trailing twelve months EPS amounted to $0.21, the number of shares used in our calculations amounted to 1,031,250,000 units. The stock traded at $5.98 as at May 31, 2021 with a corresponding P/E of 29.09 times.

Management noted that, “Across our operations we have continued to adhere to traditional underwriting discipline while investing in new distribution channels and technology. Our aim is to support our clients in satisfying their insurance needs more efficiently particularly in the digital domain.”


Balance Sheet at a glance:-

Total Assets increased by 1% to $12.11 billion as at March 31, 2021 from $12.04 billion a year earlier. ‘Due from Policyholders, brokers and agents’ contributed the most to the growth in assets with a 42% increase to $1.75 billion relative to $1.23 billion in 2020. ‘Other Receivables’ also contributed to the increase with a 117% growth year over year to close at $804.36 million (2020: $369.93 million).

Shareholder’s Equity as at March 31, 2021 stood at $2.69 billion (2020: $2.59 billion) resulting in book value per share of $2.61 (2020: $2.51).




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