Middlesea Insurance plc yesterday announced that it registered a profit before tax of €8.86 million in 2010, compared to a loss of €62.88 million in 2009. The Middlesea Group reported a profit before tax of €6.44 million in comparison to the loss of €54.4 million on the consolidated accounts for 2009.

“2010 was an eventful and challenging year,” said Joseph F.X. Zahra, Middlesea chairman. “It marked a stabilisation year which was crucial in taking the company forward”.

In a statement the company said the focus was re-set on local operations, in order to consolidate and improve upon Middlesea’s leadership position in the Maltese market. The main operating companies of the group were realigned as stand alone, autonomous companies, each focussing on core domestic operations.

While registering an increase in premiums of 4.9 per cent Middlesea Insurance plc also strengthened its balance sheet and improved its regulatory solvency position with shareholders’ equity amounting to €54.9 million as at December 31, 2010 on a consolidated basis.

At the same time MSV Life plc, a jointly controlled company with Bank of Valletta plc, registered a record year of turnover, with total premiums for the year increasing by 18.3 per cent to €147.49 million and total comprehensive income of €9.65 million. MSV Life further consolidated its position in-creasing its total assets to €1.1 billion, and currently boasts shareholders’ equity of €108.89 million and a base of more than 83,500 customers.

Progress Assicurazioni SpA, the subsidiary company of Middlesea Insurance plc is in liquidation and in February 2011 an application was made by the liquidator to the Italian Courts in Palermo, requesting that the bankruptcy of the company be ascertained and declared as such by the court. This is a normal procedure for Liquidators to obtain a Court Ruling in order to enable them to move forward with the liquidation process. Middlesea said.

“Notwithstadning the sat-isfactory profits registered during the year, the board of directors cannot and is not recommending the payment of a div-idend, due to accumulated losses on the profit and loss a/c arising from the adverse results registered by Progress Assicurazioni SpA over the last two financial years – with such a position on the profit and loss a/c the provisions of the Companies Act prohibit the ability of the company to declare a dividend,” explained Mr Zahra.

In order to restore the company’s potential to declare prudent dividends, during the upcoming annual general meeting of May 3 the board of directors will be recommending a solution that is contemplated directly by the Companies Act, involving the offsetting of accumulated losses against the issued share capital and share premium account of the company. This, Middlesea said, will have no impact on the shareholders’ funds and the net asset value of the company.

Middlesea Insurance plc will seek to bolster its position in Malta and improve its existing leading position in the local market.

“We will pursue this strategic vision with resolve and also with the help of our industry institutional shareholders, Mapfre Internacional. The drivers will include customer-centricity, product innovation, efficiency and cost rationalisation,” emphasised Mr Zahra.