Africa Re posts a strong profitable growth despite ongoing global macroeconomic headwinds
• Strong Growth of 5.56% recorded in revenue
• Strong Underwriting Performance with 87.54% in Net Combined Ratio
• Strong Investment and Other Income Growth of 21.65%
• Strong Net Income Growth of 75.42% to achieve US$ 85.09 million
The African Reinsurance Corporation (Africa Re) recorded a Gross Written Premium income of US$ 558.74 million at the end of second quarter 2024, translating to 5.56% growth from the US$ 529.33 million reported for the same period of 2023 under IFRS 4. This was mainly due to successful marketing efforts, positive pricing momentum and moderate economic growth witnessed by most African countries despite continued challenges posed by the ongoing geopolitical tensions, extreme weather conditions, fiscal policy tightening, inflationary pressures, high levels of sovereign debt, and depreciation of major currencies of our revenues.
The strong top-line performance translated into a net underwriting result of US$ 54.04 million, an improvement of 69.03% compared to the underwriting result of US$ 31.97 million reported at the end of June 2023 under IFRS 4. The net combined ratio under IFRS 4 at the end of the second quarter of 2024 stood at 87.54%, down from 91.52% recorded in the same period of 2023. This performance was driven by our diversified portfolio through stronger net retention ratio, growth in net earned premium, favourable claims experience and controlled expense ratios compared with the same period of 2023. This was achieved despite the impact of cyclone Belal as well as the February and April floods in the United Arab Emirates.
Our investment portfolio reported an income of US$ 42.02 million, translating to an increase of 21.66% compared to US$ 34.54 million recorded over the same period in 2023. The positive performance was driven by higher interest income from cash and other fixed-income instruments as well as stable returns from other asset classes.
Despite the usual impact of currency volatility on the performance of the Corporation, the overall net income under IFRS 4 at the end of the second quarter of 2024 is US$ 85.09 million, an improvement of 75.42% compared to US$ 48.51 million achieved in the same period of 2023.
Africa Re Group Managing Director / Chief Executive Officer, Dr. Corneille KAREKEZI comments: ”I am pleased with the results despite the challenging macroeconomic environment in our core markets. Africa Re will continue to monitor these developments especially the changes in exchange rate regimes and recent volatility in the global financial markets. I am optimistic that barring any fiscal, monetary, structural and industry unforeseen shocks, we are on track to surpass our targets for 2024. We will continue to deploy strategic interventions in our underwriting, investment and operational activities to maximize our returns whilst fulfilling our mandate to support the economic development of Africa”.
