This quarterly earnings news release should be read in
conjunction with our first quarter 2024 unaudited condensed
consolidated interim financial statements and management's
discussion and analysis (MD&A) as well as our 2023 Annual
Report which are all available on SEDAR+ at www.sedarplus.com.
Unless otherwise noted, all amounts are expressed in Canadian
dollars.
GUELPH,
ON, May 9, 2024 /CNW/ - Co‑operators General
Insurance Company (Co‑operators General) today released
consolidated financial results for the three months ended
March 31, 2024. The consolidated net
income was $47.2 million compared to
net income of $23.2 million for the
same quarter in 2023. This resulted in earnings per common share of
$1.69 for the quarter, compared to
earnings per common share of $0.82 in
the same period last year.
"Our first quarter results continue to reflect the trends we saw
last year, as strong premium growth is being offset by increasing
claims resulting in an underwriting loss," said Rob Wesseling, President and CEO of
Co‑operators. "Positive investment results continue to bolster our
financial performance and our balance sheet remains strong,
allowing us to provide the advice and solutions needed to help our
clients continue to build financial security and resilience."
CO-OPERATORS GENERAL'S FIRST QUARTER FINANCIAL
HIGHLIGHTS
($ in millions except for earnings per common share and
ratios)
|
1st
Quarter
|
1st Quarter
|
|
2024
|
2023
|
Key financial
data
|
|
|
Direct written premium
(DWP)
|
1,119.5
|
994.1
|
Net insurance revenue
(NIR)
|
1,122.5
|
1,017.6
|
Net income
|
47.2
|
23.2
|
Total
assets1
|
7,696.9
|
7,695.7
|
Shareholders'
equity1
|
2,615.0
|
2,575.2
|
|
|
|
Key success
indicators
|
|
|
DWP growth
|
12.6 %
|
10.1 %
|
NIR growth
|
10.3 %
|
6.3 %
|
Underwriting result -
excluding discounting and risk adjustment
|
(69.2)
|
(34.0)
|
Earnings per common
share (EPS)
|
$1.69
|
$0.82
|
Return on equity
(ROE)
|
7.5 %
|
3.6 %
|
Combined ratio -
excluding discounting and risk adjustment
|
106.2 %
|
103.3 %
|
Minimum Capital Test
(MCT)1
|
235 %
|
236 %
|
1
Balance sheet data and MCT results for
2022 are as at December 31
|
|
|
FIRST QUARTER REVIEW
In the first quarter, DWP increased by 12.6% to $1,119.5 million compared to the same quarter of
2023, while NIR increased by 10.3% to $1,122.5 million compared to the same quarter
last year. There was an increase in DWP across all core lines of
business with the auto line of business being the largest
contributor with an increase of 20.6%. Similarly, DWP increased
across all regions with the Ontario region being the major contributor
with an increase of 16.3%. DWP and NIR growth was a result of
higher average premiums, growth in vehicles and policies in force
attributable to both higher retention and new business.
Co‑operators General's underwriting loss, excluding discounting
and risk adjustment, for the first quarter of 2024 was $69.2 million, a decline of $35.2 million from the underwriting loss of
$34.0 million in the same quarter of
2023. The decline was primarily due to an increase in the net
undiscounted claims and adjustment expenses by $128.6 million which outweighed the growth in NIR
of $104.9 million when compared to
the first quarter of 2023.
The increase in net undiscounted claims and adjustment expenses
was primarily driven by higher current year accident claims,
reserve strengthening and major event activity. The increase was
partially offset by improved prior year claims development.
Accordingly, the combined ratio, excluding discounting and risk
adjustment, increased by 2.9 percentage points from the comparative
quarter.
Net investment and insurance finance income totalled
$82.6 million for the quarter, an
increase of $55.6 million compared to
the same quarter in the prior year. The increase was primarily due
to a reduction of $54.8 million in
net finance expenses from insurance contracts.
Net investment income and gains was $105.6 million for the quarter, an increase of
$2.3 million compared to the total
net investment income and gains of $103.3
million in the comparative quarter. The increase was
attributable to net gains on our equity portfolio, unrealized gains
on limited partnerships, and higher interest income. These
favourable movements were partially offset by unrealized bond
losses and lower dividend income.
Our balance sheet, liquidity and capital positions remain strong
and enable us to continue to serve and meet the needs of our
clients while also supporting our strategic areas of focus. Our
investment portfolio is comprised of high quality and well
diversified assets. The credit quality of our portfolio remains
high with 96.5% of bond portfolio considered investment grade and
82.6% rated A or higher. Our equity portfolio is 82.3% weighted to
Canadian stocks.
CAPITAL
Co-operators General's capital position remains strong, as the
Minimum Capital Test for Co‑operators General was 235% as at
March 31, 2024, well above internal
and regulatory minimum requirements. We continue to closely monitor
capital levels in response to the changing economic
environment.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This document may contain forward-looking statements and
forward-looking information, including statements regarding the
operations, objectives, strategies, financial situation and
performance of Co‑operators General. These statements generally can
be identified by the use of forward-looking words such as "may",
"will", "expect", "intend", "estimate", "anticipate", "believe",
"plan", "would", "should", "could", "trend", "predict", "likely",
"potential" or "continue" or the negative thereof and similar
variations. These statements are not guarantees of future
performance and involve known and unknown risk, uncertainties and
other factors that may cause actual results or events to differ
materially from those anticipated in the forward-looking statements
or information. Although we believe that the expectations reflected
in the forward-looking statements and information are reasonable,
there can be no assurance that such expectations will prove to be
correct. Consequently, we make no representation that actual
results achieved will be the same in whole or in part as those set
out in the forward-looking statements and information. For further
information, refer to our first quarter 2024 MD&A or our 2023
Annual Report.
ABOUT US
Co‑operators General is a leading Canadian multi-product
insurance company and is part of The Co‑operators Group Limited
(Co‑operators). Co‑operators is a leading Canadian financial
services co-operative, offering multi-line insurance and investment
products, services, and personalized advice to help Canadians build
their financial strength and security. The company has more than
$64 billion in assets under
administration. Co‑operators has been providing trusted guidance to
Canadians for the past 79 years. The organization is well known for
its community involvement and its commitment to sustainability.
Achieving carbon neutral equivalency in 2020, the organization is
committed to net-zero emissions in its operations and investments
by 2040, and 2050, respectively. Co‑operators is also ranked as a
Corporate Knights' Best 50 Corporate Citizen in Canada. For more information, please visit:
www.cooperators.ca.
Co‑operators General Class E, Series C Preference Shares trade
under ticker symbol CCS.PR.C on the Toronto Stock Exchange (TSX).
Further information can be found at www.cooperators.ca.
CONTACT INFORMATION
Investor Relations
Lesley Christodoulou
Vice-President, Finance and Chief Accountant
Email: lesley_christodoulou@cooperators.ca
Media Relations
Email: media@cooperators.ca
SOURCE The Co-operators Group Limited