MAPFRE’s nine-month revenue rises 36%

MAPFRE reported a total result of 744 million euros in the first nine months of 2024, marking a 36% year-on-year increase.

After writing down a €90 million interest in Verti Germany, net income stood at €654 million, representing an increase of 39%. The company’s growth was primarily driven by improved technical performance across all regions and business lines, which supported an increase in the interim dividend to 6.5 cents per share, an 8% increase from last year.

Adjusted return on equity (ROE) increased to 12%, shareholders’ equity increased by 4.5% to over €8.4 billion.

Antonio Huertas (pictured above), chairman and CEO of MAPFRE, noted that the results reflect the company’s strategy, with the increase in dividends showing confidence in the company’s growth and commitment to shareholders.

“In addition, we have significantly strengthened our balance in the use of intelligence, maintaining the growth of our large base,” said Huertas.

Premiums grew 4.6%, driven by non-life tax adjustments and strong performance in the Life segment. Accident and health premiums increased by 6.4%, while Auto premiums increased by 4.4%. General Property & Casualty (P&C) premiums increased by 1.1%, partially due to the agricultural business in Brazil and the depreciation of the Brazilian real.

In life saving, premiums increased by 8.2%, mainly from IBERIA and LATAM, while health protection premiums increased by 6.8%, driven by growth in Mexico and Spain. At constant exchange rates, total premiums grew by 6.1%, non-life premiums by 5.7% and Life premiums by 7.3%. Growth in IBERIA, LATAM, and reaffirmation reflected strong regional performance.

There are several factors that contributed to the 39% increase in the result: intangible technical profit improved, helped by write-downs and tax adjustments; Intangible financial results were significant, reaching €576 million due to portfolio yield; and the health business saw significant contributions from LATAM and IBERIA, with the combined rate of Life Protection stable at 85.4%, although the cost of acquisition in Brazil increased.

MAPFRE also recorded a €90 million write-down of goodwill in Verti Germany, a response to the current conditions of the Auto market in Germany, with a possible update to this effect at the end of the year depending on interest rates and business plans. In addition, it has recorded an interest of 75 million euros in the United States by 2023.

MAPFRE saw 35 million Euros in extraordinary income from tax reform, mainly due to the declaration of unconstitutionality of Royal Decree-Law 3/2016, following €46.5 billion in extraordinary income in 2023 from the end of the coalition of Bankia.

The combined non-life ratio improved by two percentage points to 94.8%, boosted by tax adjustments and fewer weather-related disasters compared to 2023, which saw losses of more than 100 million euros due to the earthquake in Turkey.

General P&C improved to 81.1%, with significant progress in IBERIA, Brazil, and North America. The combined Auto ratio decreased by 1.7 percentage points to 104.2%, with significant reductions in North America, Brazil, and LATAM, although the recovery in IBERIA continues slowly. The combined risk and survival rate remained at 99.8%.

Shareholders’ equity increased by 4.5% to more than 8.4 billion euros, supported by operating contributions. A positive unrealized gain of €194 million offsets €193 million in negative currency translation effects.

MAPFRE RE, its reinsurance arm, reported a strong result of €207 million for Q3, up 9.3%. Total premiums reached almost €6.3 billion, while reinsurance accounted for more than €4.8 billion, up 6.2%, with global risks accounting for €1.4 billion.

The combined MAPFRE RE rating held steady at 95.5%, with the third quarter affected by storms in Europe, although no other major catastrophic events occurred. The company noted strengthened reserves in response to secondary risks and reoccurrence of catastrophic events.

The financial results were also good for MAPFRE RE, although the net financial loss reached €0.5 million, following €8.4 million of profits in 2023.

MAPFRE Group’s Solvency II ratio was 196.6% as of June 2024, down slightly from 199.6% at year-end 2023 but within the company’s target range.

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