ROC reports first quarter net loss of $2.81 million

Date: May 01, 2020

IronRock Insurance Company Limited (ROC), for the three months ended March 2020, posted gross premiums of $178.67 million relative $120.78 million booked in the prior corresponding quarter; representing a 48% increase. Management noted that, “the increase was driven primarily by growth in our Motor and Property portfolios.”

Proportional reinsurance amounted to $115.70 million compared to­­ $59.06 million recorded in the same period last year. While, excess of loss reinsurance totalled $11.10 million (2019: $11.87 million). As a result, net premium amounted to $51.87 million relative to $49.86 million in the same period in 2019, a 4% increase year over year.

Net unearned premium adjustment closed the period under review at $1.08 million (2019: $2.14 million), this resulting in net earned premium of $50.80 million for the three months period versus $47.72 million in the previous corresponding quarter.

Commission expense incurred totalled $20.73 million in contrast to 2019’s $17.53 million, while commission income earned grew by 35% from $14.50 million in 2019 to total $19.56 million for the three months ended March 2020.

In addition, the company booked net claims of $27.62 million relative to $27.03 million reported in the previous comparable quarter.

Operating expenses, for the three months period, increased to $45.06 million relative to $35.14 million in the prior corresponding quarter. As such, underwriting loss worsened over the period under review closing at $23.06 million versus a loss of $17.49 million in 2019. ROC stated that, “the increase was mainly due to increased operational expenses.”

Investment income increased from $8.45 million in 2019 to $11.50 million for first quarter in 2020. Gain on sale of investment amounted to $3.91 million (2019: nil). Foreign exchange gain amounted to $4.83 million compared to a FX loss of $711,000 in 2019, while other income fell to $3,000 (2019: $14,000).

As a result, loss for the first quarter totalled $2.81 million compared to a loss of $9.73 million in 2019.

Loss per share for the period under review totalled $0.01 (2019: LPS: $0.05). While, the trailing twelve months EPS is $0.06. The numbers of shares used in the calculations are 214,000,000 units. The stock price as at May 01, 2020 was $2.10.

Balance Sheet Highlights:

As March 31, 2020, ROC’s total asset base totalled $1.23 billion (2019: $1.01 billion) increasing by 21% year over year. Investments contributed to this increase in the asset base by 33% increasing from $496.80 million in 2019 to $659.93 million in 2020. Cash and Cash equivalents and Reinsurance Assets also contributed to the rise with increases of 10% and 93% closing the period at $38.68 million (2019: $35.25 million) and $298.08 million (2019: $154.84 million), respectively.

Shareholders’ equity closed at $481.07 million (2019: $527.17 million). This resulted in a book value per share of $2.25 (2019: $2.46).

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