Middlesea Group's pre-tax profit down

Middlesea Group yesterday announced that all companies within the Group registered an improved technical performance in the first half of 2006 as compared to the previous year.

The overall performance of the international capital markets, in particular the unfavourable movements in the foreign bond market, impinged negatively on the overall result of the Group resulting in a reduced profit before tax of Lm1.24 million.

The overall profit attributable to shareholders after tax as at June 2006 was Lm1.55 million, a reduction of three per cent over previous year. After taking account of minority interests and taxation, earnings per share were reduced from 6c4 in 2005 to 6c2. This data reflect the share split effected in June 2006.

Progress Assicurazioni SpA (Progress), the Group's Italian subsidiary, registered an increased premium of Lm11.04 million (€25.71 million), an increase of 11 per cent over 2005. Progress reported an improvement in its net combined ratio from 101.7 per cent last year to 99.5 per cent this year.

The Group said it continued to enhance its pricing policy, together with stricter underwriting guidelines and a continuous drive to achieve a desirable portfolio business mix. The premiums written by the Group increased to Lm18.7 million. The holding company's net underwriting profit on its core business generated in Malta and Gibraltar amounted to Lm0.69 million (Lm0.66m - June 2005). Premium generated from this source of business decreased by 7.4 per cent to Lm7.26 million.

Middlesea Valletta Life Assurance Company (MSV), the specialist life associate of the Group, registered Lm26.4 million of business written representing an increase of 47 per cent. An interim valuation carried out by the company's independent actuaries showed that the Life Fund and other technical provisions were further strengthened by 11.5 per cent to Lm243.3 million.

The net asset value of the Middlesea Group increased from Lm1.24c per 25c share as at December 2005 to Lm1.26c at 30 June 2006.

Total assets of Lm112.65 million of the Group represented an increase of four per cent over 2005. The Group's total gross technical reserves also increased to Lm62.6 million.