TIDMGBGI
RNS Number : 0660I
GBGI Limited
19 March 2018
19 March 2018
GBGI LIMITED
("GBGI" or the "Company" and, together with its subsidiary
undertakings, the "Group")
Trading Update
2017 Calendar Year results show strong YOY gains
Reorganization of Angola business
GBGI Limited (AIM: GBGI), a leading integrated provider of
international bene ts insurance, today announces a trading update
for the 2017 Calendar Year ("CY") ending 31 December 2017.
The Group saw continued commercial momentum, in line with
management expectations, in the second half of the 2017 Calendar
Year across its diversi ed product and regional footprint. As a
result, GBGI recorded Gross Written Premium ("GWP") of
approximately US$195 million in CY 2017 as compared to US$165
million across the same period in 2016.
As previously announced, the Group continued to make further
investments in its operations to support both sales e orts and
outstanding service levels, underpinning the robustness of its
growth platform.
Operational and Business Highlights
-- GBGI recorded IFRS Gross Written Premium of approximately
US$195 million for CY2017 versus US$165 million for the same period
in 2016.
-- The Group's global strategic partnership with AXA continues
to develop, with progress being made across two key areas of
collaboration: reinsurance and access to new markets. In
particular, the Group has utilized its partnership with AXA to
enter new Latin American markets and create a product line focused
on the needs of individuals.
-- GBG Assist has fully integrated its QHM acquisition and is
now leveraging the cost containment network across the entire set
of group policies. In addition, the Group will be recording over
US$5.5 million of GBG Assist fees in CY2017, including
approximately US$1.6 million from the QHM acquisition.
-- GBGI continues to deliver strong growth in Group corporate
policies establishing a new record policy count, increasing the
account base by approximately 15% over the 12 month period.
-- GBGI bolstered its regional leadership team with the hiring
of two key senior managers:
-- Mr. David W. Carter is now the Regional Vice-President for
GBG Asia Pacific. David's role will be to build premium growth in
the region and increase GBGI's distribution platform.
-- Ms. Cathy Garner is now the Global Head for Life and Long
Term Disability. Cathy will be working closely with the GBGI Sales
teams, brokers and distributors to develop customized life and
disability products to expand GBG's brand globally.
-- Andy Thorburn, previously an Executive Director of the Group
serving as Director of Strategic Planning, has now assumed a
Non-Executive Director role on the Board. This follows from the end
of his employment contract with the Company on 1 January 2018.
-- Pursuant to the Board's vigilance in managing risk exposure,
and in light of the Angolan AOA currency devaluation and GBGI's
view on the inability to transfer funds to USD (or equivalent
currency) in a timely manner, the Group has reorganized its
approach in the Angolan market. The Company expects that this
change in approach would result in a reduction in CY2018 GWP of
approximately US$20 million in the region. Due to the low margin
nature of this stream, the Company expects the net reduction in
profitability to be under US$1 million in CY2018.
-- Under the new approach in Angola, GBGI moves from a primary
risk taker, transferring its risk book and operations to its local
partner in Angola. GBGI will continue in Angola as an excess of
loss reinsurer to its local partner. In return, for transferring
the business, the local partner has agreed to pay GBGI, in Angolan
AOA, US$17.5 million for its undistributed profits and expertise,
over the next 3 years, with the first payment commencing in April
2018. Due to the currency controls introduced by the Angolan
government under its Macroeconomic Stabilization Program, the
Company is considering its approach in relation to the surety of
this balance and effect on the Group, which is expected to include
a consequent effect on CY2017 statutory profits.
-- A prudent approach will be taken on an interim dividend for
the six-month stub period to 31 December 2017.
Reporting dates
-- As previously announced, the Company has changed its
accounting reference date to 31 December. Under this new reporting
cycle, the Group's audited financials for the 2017 Calendar Year
period (January-December) are expected to be released in April 2018
with an Annual General Meeting being scheduled for June 2018.
Bob Dubrish, CEO of GBGI commented:
"We believe we made great strides in transitioning into a public
company listed on AIM in London during Calendar Year 2017. Although
we are disappointed with the developments in Angola we do believe
it is a unique situation within our portfolio and our core business
remains strong and continues to grow. Looking forward, we are
focusing our balance sheet resources on areas that we believe will
reduce our overall risk profile and generate enhanced risk adjusted
returns for our shareholders. We continue to see strong demand in
the marketplace for our products and services and we are well set
to continue on our positive growth trajectory."
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
For further information please contact:
GBGI Limited
Bob Dubrish (CEO) +1 949 421 3180
Eric Dickelman (CFO) +1 949 421 3390
Canaccord Genuity (Nominated Adviser & Broker) +44 (0)20 7523 8000
Sunil Duggal
Andrew Buchanan
Emma Gabriel
Instinctif Partners (Financial PR) +44 (0)20 7457 2020
Giles Stewart
Rui Videira
Lewis Hill
Notes to Editors
GBGI is a leading integrated provider of international bene ts
insurance, operating globally across over 120 jurisdictions.
Trading principally as "The Global Bene ts Group" or "GBG", the
Group distributes and underwrites health, life and disability, and
travel insurance, with a client base that spans multinational
corporations, expatriates, local HNWIs, international schools,
non-pro t organisations and international students. GBGI is a fully
integrated insurance group providing services from policy sales to
claims administration and servicing and is committed to delivering
high levels of customer service. GBGI is incorporated in
Guernsey.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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