Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (June 16): Allianz Malaysia Bhd's net profit for the first quarter ended March 31, 2020 (1QFY20) fell 19.63% to RM79.5 million from RM98.92 million the year before, due to a swing from investment-related gains to losses.

Quarterly earnings per share slumped to 44.94 sen, from 55.97 sen in 1QFY19, its results filing today showed.

The decline, which was also contributed by higher expenses, came despite higher revenue, lower tax and lower net benefits and claims in the quarter.

The investment segment was the worst hit with fair value losses of RM486.1 million from RM195.56 million gains in 1QFY19. Realised losses widened to RM71.06 million, from RM27.97 million.

Segment-wise, Allianz said that the life insurance segment's pre-tax profit fell 65.9% to RM23.5 million from RM68.9 million, due mainly to the volatile financial market, which resulted in lower valuation on investment and changes in insurance contract liabilities.

Meanwhile, the general insurance segment saw higher claims, resulting in pre-tax profit falling 13% to RM74.5 million from RM85.6 million.

Concurrently, Allianz Malaysia's investment holding segment's pre-tax loss widened to RM6.02 million from RM3.18 million.

The lower bottom-line performance came despite a 10.44% jump in revenue in the quarter to RM1.48 billion, from RM1.34 billion previously.

The jump was attributable to higher gross earned premiums and investment income from both general and life insurance businesses, thanks to growth in all key distribution channels, Allianz said.

However, its investment holding revenue narrowed 8.2% to RM3.38 million from RM3.69 million.

Overall, it noted that the Movement Control Order (MCO) to address the Covid-19 pandemic did impact its businesses.

"Outlook for both general insurance and life insurance industries is expected to remain challenging in the medium term amid weak consumer sentiment and subdued domestic economic activity arising from Covid-19," it said.

"The group is closely monitoring and responding to the impact arising from Covid-19 and MCO on business and investment performance," it said.

It added that ongoing initiatives will continue, such as enabling the agency's digital connectivity and recruiting, and to digitalise products, sales, claims and operations.

"The group's aim is to become a simple, digital, and scalable organisation that is fully customer-centric," it said.

Shares in Allianz Malaysia rose 18 sen or 1.27% to close at RM14.30 today, valuing the group at RM2.53 billion.

      Print
      Text Size
      Share