Middlesea registers €6.82 million interim pre-tax profit

The consolidated Middlesea Group result for the first six months of 2013 amounted to a profit before tax of €6.82 million, compared to €7.17 million registered during the comparative period last year.

The profit after tax allocated to shareholders amounted to €2.43 million as compared to €2.79 million in 2012. Although the technical performance of the company's general business was affected by losses, particularly in the motor class of business, which were higher than those registered during the corresponding period last year, the group registered a satisfactory results, due to the improved performance of MSV Life plc, the life subsidiary, which registered a higher profit. 

The company's turnover was negatively impacted as a result of the termination agreement with a major agent that set up its own insurance company at the beginning of the year.  Whilst premium volumes are 11.8% below previous year, the company has managed to acquire substantial new business to minimize the impact of the lost business. This successful strategy is significant in the light of the fierce competition and severe price undercutting dominating the general business market. MSV Life plc saw its premium written increase by 23.6% contributing to an increased volume of business for the Group.

Financial markets performed well during the first half of the year and had a positive influence on the investment portfolio returns particularly that of MSV Life plc. The improved sentiment on foreign financial markets coupled by a positive performance by the Malta Stock Exchange contributed to better returns being achieved both compared to forecasts and previous year. 

Cost curtailment remains high on the agenda and positive results have been achieved in this area during the period under consideration.

Middlesea Insurance p.l.c.'s solvency position as at 30 June 2013 on its general business stood at 495% of the minimum solvency requirement (31 December 2012 - 603%).

Whilst registering satisfactory results both in the technical and non-technical accounts, the group said it was moving into the second half with cautious optimism in achieving its targets.

Focus will remain on improving return to shareholders through strategies aimed at enhancing technical performance and cost curtailment in the current harsh competitive environment.

In line with Company policy, the Board of Directors do not propose to pay an interim dividend for the half year ended 30 June 2013 (2012 - nil).