IFRS17: AXA Mansard revenue rise by 12%

Bisola David
Bisola David
IFRS17: AXA Mansard revenue rise by 12%

Due to the implementation of the IFRS17 and IFRS9 accounting standards, AXA Mansard Insurance plc, a part of the AXA Group, reported a 12% increase in revenue for the second quarter ended June 30, 2023.

A new accounting standard was implemented on January 1, 2023. As a result of the change in accounting standards, gross earned premiums (insurance revenues) are now the main indicator of revenue.

Now, insurance operations’ commercial activity will be reported using insurance (earned) revenues as opposed to gross written premiums.

The Chief Financial Officer, Mrs. Ngozi Ola-Israel, commented on the results, saying, “Despite our difficult and changing economic environment, particularly in the second quarter of the year, we were able to grow Gross Written premiums by 22% in the first half of the year and deliver insurance revenue growth of 12% from N34.7 billion to N39.0 billion.

“This success further strengthens our ability to produce lasting outcomes in a difficult business environment. Due to the strong improvement in the P&C and L&S segments, net FX gains from the effect of the devaluation, as well as the significant recovery from the health segment, our operating performance also dramatically improved, with PBT growing by 528 percent to 14.8 billion from 2.4 billion last year.

The Chief Executive Officer of AXA Mansard Insurance, Kunle Ahmed, commented on the company’s financial results at the conclusion of the first half of 2023, saying, “We are proud to retain the trust of clients, brokers, and partners despite the hard economic situation.

“The outstanding performance demonstrates our dedication to ensuring sustainable growth in the face of this environment, as we achieved improved revenue and operating performance in the first half of the year,” he said.

According to the underwriter, insurance revenue increased YoY by 12% (from 34.7 billion to 39.0 billion). Health (+27%) and L&S (+23%) are the growth’s main drivers, with a P&C decline of 5% partially offsetting this. This is because major business was booked in the current period at a different time than it was at the same point last year.

Due to the Oil & Energy portfolio’s outstanding performance, which rises by 21%, and reductions in Aviation and Marine due to changes in the structure of major companies, P&C improves by 19% year over year.

Improvements in personal lines performance and rising premiums on profitable renewals and new business also contribute to growth. In order to assure the expansion and profitability of each of our portfolios, the emphasis is still on preserving efficiency.

Due to the Oil & Energy portfolio’s outstanding performance, which rises by 21%, and reductions in Aviation and Marine due to changes in the structure of major companies, P&C improves by 19% year over year.

The increase in management fees brought about by better third-party assets under management contributed to the 14% YoY increase in total revenues. Own AuMs increased by 25%, while the number of third-party clients increased by 18%, resulting in a 30% increase in third-party AuMs and a 28% increase in total AuMs.

A 37% decline in the life business partially offset the overall improvement of 528% YoY in PBT, which increased significantly due to a 346% increase in P&C earnings and significant growth in the health sector. Improvements in revenues and underwriting performance, as well as fair value gains, are responsible for the 346% growth in P&C.

The shareholder’s fund was N41.4 billion, up from N29.7 billion in FY22, a 40% increase, thanks to H1 profits and fair value gains.

Due to the business’s improved performance, Return on Shareholder’s Equity increased by 33.8% percentage points from 7.7% in the prior year to 41.5%.

Due to changes in fair value reserves, the group’s operating performance increased by 528% (to N14.8 billion from N2.4 billion LY), and average shareholder equity increased by 16% (to N35.6 billion from N30.7 billion LY). We all remain dedicated to giving our stockholders value.

When compared to the previous year, the return on assets increased by 9.9 percentage points, from 2.1% to 12.0%. The increase suggests effective asset utilization for enhanced PBT growth of 528% (N14.8bn from N2.4bn LY). 

As we continue to build on our financial strength throughout the year, the average asset has also climbed by 10% (from N111.9bn to N123.0bn LY), thanks to a strengthened asset base (near cash and insurance contracts assets).

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