Africa Re hails solid results but warns Brexit means further headwinds

Gross written premiums at Africa Re shrank in the first half of 2016 due to fluctuations in currency exchange rates. However, profits at the reinsurer remained stable and both its underwriting income and investment income enjoyed solid gains.

The company’s GWP dropped to $348 million, a decrease of 5.7 percent compared with the same period a year earlier. It blamed a 29 percent depreciation in the Naira currency following changes in policy by the Central Bank of Nigeria, stressing that Nigeria is its third largest market.

The company made an underwriting profit of $13.6 million, an 8 percent increase compared with the year before while its investment income in the period increased by 13 percent to $20.6 million despite what it called a volatile and challenging environment.

It made a net profit of $32.7 million compared with $32.1 million a year earlier.

Corneille Karekezi, the CEO of Africa Re, said he feel the company is on track in 2016 despite headwinds: “We have been preparing ourselves for tougher market conditions in 2016 and do not see any sign of an improving global economy especially after Brexit in June. Besides, the depreciation of African currencies and challenging macro economic conditions are likely to continue in the second half of the year. Against this backdrop we continue to drive agility and cost discipline, implementing the key initiatives announced at the end of last year.”