TM reports profit of ISK 886 m
Principal figures for Q1 2007
• Profit for Q1 came to ISK 886 m, against ISK 626 m for the same period last
year.
• Premiums written in Iceland grew by 18%.
• Written premiums more than doubled to reach ISK 8,675 m, compared with ISK
4,082 m during Q1 2006.
• Losses on the quarter's insurance operations came to ISK 5 m, compared with a
loss of ISK 215 m in Q1 2006. Losses on insurance operations in Iceland came
to ISK 113 m.
• Earnings per share for the quarter came to ISK 0.82.
• Investment income came to ISK 1,894 m during the quarter, compared with ISK
1,711 m in Q1 2006.
• TM's total assets stood at ISK 73,812 m on 31 March 2007, having grown by 6%
from ISK 69,379 m at the beginning of the year.
• The Norwegian insurance company Nemi became part of the consolidation as of 1
September 2006, which complicates direct comparison of Income Statement and
Balance Sheet figures with those from the previous year.
Comments
Óskar Magnússon, President & CEO of TM, says growth continues to characterise
the company's insurance operations in Iceland. Written premiums grew by 18%
during the first quarter, premiums earned for own account growing by 22%. In
Norway, written premiums remained unchanged, while there was a growth of nearly
10% in premiums earned for own account. Nemi's profit came to ISK 153 m during
Q1.
The trend in claims in two insurance categories in Iceland continues to give
cause for concern. Seamen's accident insurance has continued to yield losses,
and the strategies adopted in 2006 have not produced their full effect.
Continuing losses in this sector are the object of particular concern. Motor
hull insurance has yielded a loss, but measures were taken towards the end of
last year to reverse this trend. Insurance operations in Norway, on the other
hand, yielded a profit of ISK 108 m.
Market conditions were favourable during Q1 this year, and investment income
came to ISK 1,894 m. Work continued on the diversification of the asset
portfolio, with investments made in some companies in Scandinavia. On 2 May
this year, TM received from Standard & Poor's BBB long-term counterparty credit
and insurer financial strength rating, which is very positive news and opens up
market opportunities for the company. The TM subsidiary Nemi, which also holds
a BBB rating from S&P, has achieved considerable success, for example in the
international marine insurance market.
For further information, please contact Óskar Magnússon, President & CEO, tel.
515 2609.
Operational Prospects and Future Vision
TM's growth prospects remain good. The recent rating by Standard & Poor's will
enable the company to enter new markets that have more favourable cost ratios
than can be found in Iceland. The rating by S&P now makes it possible for TM
and Nemi to offer new insurance jointly. Systematic work went ahead last year
to improve insurance performance, and this should produce results during the
current year. It must be remembered, however, that claims levels can change
suddenly, greatly influencing the results of insurance operations.
Audit
This quarterly Earnings Release has not been audited. TM's board and President
& CEO today approved the Q1 2007 Earnings Release. It is to be found on the
company's website, www.tmhf.is.
Forthcoming scheduled statements
Q2 Interim Statement 2007: 01.08.2007
Q3 Interim Statement 2007: 02.11.2007
Earnings Release 2007: 08.02.2008
