Distinguished Shareholders, colleagues on the Board of Directors, special guests, gentlemen of the press, eminent ladies and gentlemen, it is with much pleasure that I welcome you all to the 20th Annual General Meeting of our company where the Audited Annual Financial Statements and Annual reports will be presented for your kind consideration. I will first give an overview of the environment in which the company operated
BUSINESS OVERVIEW OF 2013
The year 2013 saw the structural shift from the developed world towards the emerging world and the cyclical climb out of a nasty recession. The recovery though slow has been such that a corner might have been turned.
The hint in May 2013 that the US Federal Reserve would start to unwind its massive monthly $85bn bond buying scheme, led to the reverse flow of so called ‘hot dollars’ impacted heavily on the exchange rate of currencies of most emerging markets. There was a slowdown in the growth rate of the BRICS economies. Even China’s growth rate put at 7.6% is still far off the breakneck double digit growth it had hitherto experienced. The issue of global trade liberalisation received a boost when governments reached a modest agreement to increase flow of goods across borders.
On the domestic front, there was a growth in real GDP in 2013 estimated at 7.61%, Inflation rate stood at 8% in December 2013 as against 12.0% in December 2012. The exchange rate fell from =N=156.70/$1 to =N=157.50/$1 while the nation’s external reserve fell from US$43.83bn to US$42.85bn during the year. The All Share index of the Nigeria Stock Exchange grew from 28,078.81 to 41,329.19 a growth of 47.1%.
However, while there was relative stability on the macro-economic front, there was not much improvement on the micro level. Reports by the World Bank and other multilateral agencies still ranked the country low in terms of human development indices, while the nation is still ranked as a lower middle income country.
On the industry level, with the enforcement of the ‘No Premium, No Cover Policy’ the issue of delay in premium remittances by the insured and the Insurance Intermediaries were drastically reduced during the year. However the problem of rate cutting in the face of increased competition among operators intensified.
There has been increased interest by foreign players seeking to have a stake in the local insurance companies.In addition, local Investors are seeking to acquire with other stakes in the industry. Hence the insurance sector has become an investor’s target.
The National Insurance Commission intensified its role of monitoring and regulating insurance business and carried out increased on and off site inspections of the various operators. There has been an increase in the nature, scope and depth of reports with a view of ensuring increased confidence of the insuring public.
YEAR 2013 FINANCIAL HIGHLIGHTS
The company’s performance improved during the year. The Gross Premium Written increased by 38% from =N= 2.280bn to =N=3.146bn. The underwriting profit decreased by =N=27.1m from =N=1.060bnto =N=1.033bn.This decrease is as a result of huge jump in claimsand management expenses in the year when compared with the previous year. In the year, Management expenses increased by 30%.when compared with that of last year.
Overall, the Profit after tax for the company improved from =N=386.785m in 2012 to =N=403.603m in 2013.
For the group, the contribution of the subsidiaries to the group’s profit after tax, after deducting that attributable to Non-Controlling Interests, increased from =N=38.685m in 2012 to =N=51.188m in 2013.
The Board is not recommending payment of dividend to our esteemed Shareholders as the retained earnings is still in deficit. It is hoped that soon the company will be in position to reward our shareholders accordingly. We appreciate your patience in this regard.
The Management and Staff of the company are highly commended for the deep sense and display of loyalty, commitment, honesty and dedication to duty in the year. Your efforts in moving the company forward will always be adequately rewarded. I must also appreciate our esteemed clients, agents and brokers for doing business with us. No doubt we have earned your confidence and look forward to your increased support and patronage now and always.
I want to assure you all that Regency Alliance Insurance Plc is here for the long haul. We have strong confidence that the socio-economic climate notwithstanding, this is a land of immense opportunities and prospects and the company will make the best of all situations. We will also hold on to our corporate ideals and values of Professionalism, Integrity, Commitment and Efficiency while ensuring that we will create wealth for all our stakeholders and mitigate risks associated with it.
HON. JUSTICE A. G. KARIBI-WHYTE CFR