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Last week, the stock exchange received and published the full year financial results of the Middlesea Group.
The board of directors of the leading insurance company in Malta announced their full year financials for 2006, which are strong but not as good as the record results recorded in the previous year.
The technical account shows that Middlesea has a balance of Lm2.6 million being 43% less than the previous year. This reflects the prudence practiced by the Directors who also saw the gross premium income increase by 6.4% to reach Lm36 million. The strategy adopted by the Group to enhance its joint venture with BOV for long term business has resulted in a share of profit of one and a half million Malta liri, being a 28.5% increase over that of the previous year.
Middlesea registered lesser income from investment income even though the expenses and charges related thereto remained at the same level. It also had an increase in administrative costs but lowered drastically its allocated investment return towards its general business technical results.
At a profit before tax of Lm3.7 million, which is 44% less than the previous year, the company reduced its effective tax rate to 12% being half that of the previous year.
Middlesea has a total asset figure of Lm118 million, the majority of which are found in investments that reflect more than the amount it has in technical provisions. Despite a slight reduction in the end of year cash amount, the Board is recommending a final dividend of 4cents five mils.
When interpreting the results of a financial institution such as Middlesea, readers have to keep in view certain important aspects and not just the bottom line figures. The prudence adopted by the Directors in their Insurance business decisions is as important as its investment portfolio and the future plans for the Group. This Group is expanding its overseas operations and is moving towards a greater territorial spread that has already evidenced in increased contracts.
These results did not come with any surprises and continue where the interims had left off. As the leading insurance company in Malta, the results of Middlesea are not just of interest to the shareholders but to the community of individuals and businesses that have their insurance requirements dependant on this entity.
Its logo of one darker segment of the world is not reflective of the any reader’s impression. The Middlesea Group is an all performing entity. |
