MAPFRE Middlesea p.l.c held its AGM last Friday and declared that as a standalone company it registered a turnover of €87.12 million in gross premium written, an 8.7% increase over FY 2021 registering a marginal reduction in its non-life business market share.
MAPFRE Middlesea p.l.c CEO Javier Moreno explained that growth was registered in all classes of business with significant growth in Health and Travel that picked up as outbound tourism outperformed sector estimates as the pandemic receded. Technical performance in the non-life business remained level with the previous year although claim levels returned to pre-pandemic levels particularly in Motor. On the other hand, group life business returned an even stronger result than the comparative year.
Investment income for the Company excluding dividends from Group companies was negative for FY2022 as fair value losses were registered both on property revaluation and on financial instruments compared to an overall positive contribution in FY2021. Total gross dividend from Group companies amounted to €1.31 million up from the €0.14 million in FY2021 as MAPFRE MSV Life p.l.c. distributed a contained dividend after an absence of two years.
The Company registered a profit before tax for FY 2022 amounting to €5.99 million, compared to a profit of €4.06 million in FY 2021. Profit after tax increased from €2.61 million in FY 2021 to €3.79 million in FY 2022.
Chairman Martin Galea announced that the Company maintained a strong balance sheet, with its Shareholders’ equity amounting to €77.09 million, still maintaining a strong regulatory solvency position as at 31 December 2022 under the Solvency II regime.
The Group’s results include the consolidated MAPFRE MSV Life p.l.c. (“MMSV”) profit before tax of €17.17 million (2021: €16.69 million). MMSV reported gross written premiums of €248.76 million compared to €325.14 million in 2021 mainly driven by a lower demand from single premium With-Profits business. The uncertain economic environment, increased market volatility and increased debt issuance at higher coupon rates were the main factors behind the decrease in demand for MAPFRE MSV’s flagship product, the With Profits Single Premium Plan. MAPFRE MSV’s With Profits Fund returned a gross negative investment return of 13.1% compared to the positive 4.2% generated in 2021. The breadth and depth of the financial markets turmoil was such that even well diversified investment portfolios closed the year with a negative performance, notwithstanding the market recovery from the year’s low, during the last quarter. Investment return closed with a negative €286.72 million compared to a positive €97.58 million in 2021. The MMSV profit after tax consolidated for FY 2022 amounted to €11.70 million (2021: € €10.56 million).
Total Group capital and reserves attributable to shareholders (excluding non-controlling interests) as at 31 December 2022 was €113.08 million, compared to €111.04 million as at 31 December 2021 as a result of the profit for the year outweighing the decrease in the value of-in-force business and the dividends paid by both MAPFRE Middlesea p.l.c. and MAPFRE MSV Life p.l.c..
A final gross dividend in respect of year ended 31 December 2022 of €0.054618 per share amounting to a total dividend of €5,024,817 (2021: €2,796,910) was proposed by the directors at the annual general meeting. This is equivalent to a net dividend of €0.038044 per share amounting to a total net dividend of €3,500,000 (2021: €2,400,000).
The outlook of the Board of Directors for 2023 remains one of cautious optimism. The local economy is expected to remain resilient in the context of a more challenging environment as inflationary pressures continue to push the cost of living higher. Global capital markets outlook remains one of volatility, at least, as long as inflation concerns persist and the interest rate path remains unclear with continued geopolitical risks in the background. With inflation running at levels not seen in decades, global central banks will continue to play a crucial role through monetary policy and their actions and communication having a significant bearing of the investors sentiment and capital markets performance. Taming inflation while avoiding a hard landing will remain the key tough priority of global central banks. Geopolitical risks will also continue to bear on the global economic recovery and capital markets volatility. The war in Ukraine not only continues to exacerbate the supply chain bottlenecks and inflationary pressures but further potential escalations could serve as a catalyst for markets to sell off.
Javier Moreno said “2023 will be the second year of the three-year Strategic cycle for the Group with the three main pillars being Customer Focus, Distribution and Diversification and Gaining Efficiency, goals that will continue to underpin our strategies for the coming two years.”
The Chairman thanked Dr Robert Suban, who did not seek re-appointment as Director, for his sterling contribution to the Company. Mr Godfrey Swain was appointed as director, subject to regulatory approval. At the Board Meeting convened immediately after the Annual General Meeting, Mr Martin Galea was re-appointed as Chairman of the Board of Directors of MAPFRE Middlesea plc.
MAPFRE refers to MAPFRE Middlesea p.l.c. (C-5553) and MAPFRE MSV Life p.l.c. (C-15722). Both entities are authorised under the Insurance Business Act and are regulated by the Malta Financial Services Authority.