The following is a summary of the Mapfre, S.A. (MPFRF) Q4 2023 Earnings Call Transcript:
Financial Performance:
Mapfre reported an impressive revenue increase, with premiums just under €27 billion (up nearly 10%) and total revenues over €32 billion (up around 9%).
The company ended the financial year with a net income of €767 million, marking more than a 19% increase, excluding a €75 million write-down.
The improved combined ratio to 97% is still above the target, causing some concern, while the Return on Equity (ROE) is within the target at 9%.
Dividends increased to €0.09, their highest in five years, leading to a total of €0.15 per share, offering one of the highest dividend yields amongst leading European insurers at 7.7%.
Mapfre experienced growth in Life and General insurance, as well as reinsurance and large commercial businesses, contributing to a diversified profit pool.
Despite some big losses due to global events, the net result touched €692 million with strong performances in Latin America and Iberia.
Business Progress:
Mapfre is implementing a new strategic plan aimed at increasing sustainability, profit, and ROE. This plan will introduce several operational improvements including tariff adjustments and incorporation of climate change risks.
The growth in recurrent yield in fixed incomes for 2024 is expected, though there are points to be improved significantly in markets such as Brazil and Mexico.
Mapfre is continuously transforming digitally, with a significant 25% increase in digital clients over the year, now totaling 2.4 million.
They anticipate improvements in the Motor Insurance segment due to tariff adjustments aimed at counteracting increasing claims.
The company experienced significant growth in U.S., increasing tariffs and non-consumer premiums by 30% and 18% respectively from beginning of the year.
It aims to remain financially flexible by observing the repatriation of dividends, reducing the impact of volatility in the P&L, and expanding its investment portfolio.
The company is ahead in its asset management, with pension funds up over 12% and mutual funds nearly 20% over the year, indicating strong operational performance.
More details: MAPFRE SA IR
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