The acquisition of a pension subsidiary and impressive results are pointers to AXA Mansard’s emergence as a leader in the insurance industry, writes Goddy Egene
Investors’ patronage of the nation’s stock market is low due to the current economic challenges. The stock market has performed poorly in the past two years, posting negative returns. Despite many opportunities that abound in the market as a result of highly discounted value of most stocks, investors still stay away from the market.
The insurance sector of the market is the worst hit as investors’ perception of insurance equities has remained negative. Following the poor financial performance of many of the insurance companies after the financial crisis of 2008 and 2009, demand for their stocks has remained low. Hence, most of the stocks are trading at par value of 50 kobo.
Although many of the insurance companies have shown resilience and has so much potential to perform better and put smiles on the faces of investors, AXA Mansard Insurance Plc has stood out. The equity is the highest priced in the sector, trading above N2.00.
The company was incorporated on 23 June 1989 as a private limited liability company called “Heritage Assurance Limited” and issued with a composite insurance license by the National Insurance Commission in March 2004. The company’s name was changed to Guaranty Trust Assurance Limited in September 2004 following the acquisition of a majority shareholding by Guaranty Trust Bank Plc. In November 2009, the company became listed on the Nigerian Stock Exchange (NSE). The beneficial ownership of the company changed to Societe Beaujon S.A.S (AXA S.A) in December 2014 by the acquisition of 100 per cent of Assure Africa Holding (AAH). The Company modified its name and corporate identity to AXA Mansard Insurance Plc in July 2015.
The principal activity of AXA Mansard Insurance Plc is the provision of life and general business risk management solutions and financial services to corporate and retail customers in Nigeria. The company has two wholly owned subsidiaries namely AXA Mansard Investments Limited AXA Mansard Health Limited and two partly-owned subsidiary – APD Limited and AXA Mansard Pensions Limited, which was acquired last year.
The AXA Mansard Insurance Board of Directors has Mr. Victor Osibodu as chairman. Mrs. Yetunde Ilori is chief executive officer, while Mr. Tosin Runsewe as chief client officer.
Other directors are: Mr. Kunle Ahmed (executive); Mr. Olusola Adeeyo (independent); Mr. Frederic Flejou(non-executive); Mrs. Sahondra Ratovonarivo(non-executive); Mrs. Karima Silvent(non-executive); Mr. Lesley Ndlovu(non-executive); Mr. Tom Wilkinson(non-executive).
AXA Mansard posted improved bottom-line in 2015 and has also started 2016 on a positive note as well. The company recorded a net premium income of N9.905 billion, for the year ended December 31, 2015, showing an increase of nine per cent from N9.054 billion in 2014. Investment income grew by 28 per cent from N3.603 billion to N4.598 billion. Profit before tax (PBT) stood at N2.023 billion, while profit after tax (PAT) was N1.662 billion, compared with N2.015 billion and N1.537 billion respectively posted in 2014. The company’s shareholders’ funds grew from N15.204 billion in 2014 to N17.413 billion.
As the economy remain under pressure and some companies post poor results, AXA Mansard Insurance consolidated on its 2015 positive performance in the first quarter of 2016. The insurance firm grew its net premium income to N2.758 billion, from N2.391 billion. PBT rose N512 million in 2015 to N751 million in 2016, while PAT stood at N700 million, indicating a growth of 44 per cent compared with N486 million in the corresponding period of 2015.
Addressing the shareholders last week, Osibodu said in 2015, despite the economic headwinds, the company remained profitable and strongly positioned in its various business segments even as it expanded into new growth areas.
He said even though gross premiums written declined by five per cent to N16.6 billion from N17.4 billion in 2014 as customers delayed investment decisions, the foundation we had laid in prior periods ensured we recorded nine per cent in growth in net premium income from N9.05 billion to N9.9 billion.
“We also maintained our PBT at N2.02 billion, same as 2014 while growing PAT eight to N1.7 billion from N1.5 billion in the previous year. We maintained a robust balance sheet growing total assets to N51.21 billion in 2015, a 14 per cent rise compared to N44.89 billion in 2014. Insurance liabilities were N12.92 billion in 2015 also rising by 14 per cent compared to N11.29 billion in 2015 while shareholders’ funds grew 15 per cent to N17.41 billion from N15.2 billion in the prior period,” he said.
Speaking on the future prospects, Osibodu said the year 2016 will bring its own set of opportunities and challenges.
“However, the macroeconomic outlook will be hinged on the implementation of the current administration’s expansionary budget, the shift from oil revenues to non-oil revenues, interest rates and inflation management, foreign exchange rates policy, possible removal of fuel subsidy, as well as policy reforms in power, oil & gas and transportation. The Board assures you of its continued commitment to the delivery of optimal returns whilst keeping the company a responsible corporate citizen of our great nation, Nigeria,” the chairman said.
In her remarks, the CEO, Ilori said the company’s risk pool is growing evidenced by the 14 per cent growth in insurance liabilities from N11.29 billion in 2014 to N12.92 billion in 2015.
“We are improving our channels and distribution structure as we leverage our robust platform, group synergies and technical excellence to drive growth. We are well-positioned to continue delivering on our ambitions while focusing on the immense opportunities in the insurance industry. Our core strength remains our people and our customers. We will continually create channels that enable our people to offer the best to our customers,” she said.
The chief client officer, Tosin Runsewe said in 2015 the company drove significant changes across its business as it laid the final blocks of the foundation for its collective envisioned future.
“We integrated our business into that of our new parent company, upgraded our brand and finalised the addition of a pensions arm to our group.
The upgrade of our brand in July 2015 from Mansard Insurance to AXA Mansard Insurance sign-posted our branding and positioning activities during the year. The global AXA brand that we now have is well-recognised among our current and prospective corporate clients while our heritage of customer service as Mansard Insurance Plc. has remained strong with our retail customers,” he said.
He said the company’s efforts to build a strong financial institution did not go unnoticed as A.M. Best – the world leader in Insurance risk ratings, upgraded AXA Mansard’s risk ratings to B+ for financial strength and bbb- for issuer credit, which are the highest ratings awarded to any Nigerian insurer and the second highest in Sub-Saharan Africa.
“In addition to the corporate recognition arising from our improved risk ratings, our commitment to the development of our employees as well as the strength and talent of our people was recognised through several awards and accolades. For the third consecutive time, AXA Mansard was adjudged a “Great Place to Work” in Nigeria by the Great Place to Work Institute.
We also emerged winner in the category for “Promptness in Claims Settlement” in the insurance industry at the Lagos Chamber of Commerce & Industry (LCCI) Awards,” Runsewe said.
He expressed confidence over the company’s strength to weather the stormy days ahead.
“Our strategy for 2016 will be to continue to deliver best-in-class innovative services through convenient and innovative distribution channels. With the continuous improvement and upgrade of our processes and platforms, our customers can be assured of nothing short of best-in class, globally acceptable service delivery standards,” he said.
Runsewe appreciated all our stakeholders for their unflinching support, which he said gave the company the courage to continue striving to achieve greater heights in all its chosen markets.
“Whilst counting on your continuous support, we will forge ahead towards our goal of positioning your company as the clear leader in the non-bank financial services sector of the Nigeria economy,” he said.