Royal Exchange Plc yesterday released its audited report for the 2017 business year, showing modest increase in gross premium written from N12.5 billion in 2016 to N12.8 billion in 2017.
Key extracts of the audited report and accounts for the year ended December 31, 2017 showed that net premium income stood at N7.1 billion while underwriting profit amounted to N7.6 billion. Total assets grew marginally by five per cent from N31.7 billion in 2016 to N33.3 billion in 2017. Net claims paid in 2017 stood at N3.4 billion, a reduction of four per cent N3.6 billion paid in 2016. Net income before management expenses totaled N2.4 billion in 2017 as against N2.7 billion in 2016.
Group Managing Director, Royal Exchange Plc, Alhaji Auwalu Muktari, said that despite the very harsh operating environment, the group was able to grow its figures by participating in large-ticket financial transactions, as well as playing in the retail insurance market, which shall be a key growth driver in the years ahead.
According to him, Royal Exchange Plc envisions a situation where the retail insurance market should be able to contribute between 50 and 60 per cent of its revenues in the future, as the retail market is the future of insurance in Nigeria, considering the population of the country.
He added that with the recent approval from the National Insurance Commission to undertake agricultural insurance, the company has entered into strategic alliances with various stakeholders in the agricultural space to drive insurance with that sector of the economy and in the couple of months, revenues will start coming in from there.
“Royal Exchange Plc, will in the years to come, continue to be an aggressive player in the retail market in Nigeria and will be looking at different strategies to increase its product offering and visibility in the marketplace, while not losing track of the corporate market, where the returns and margins, are getting thinner, yearly,” Muktari said.
He noted that the bottom-line result of the group did not turn out as projected, due to increase in cost of doing business in the country, especially in the area of power generation and the general lull in the economic activities within the corporate markets.
He pointed out that the company has implemented various cost optimization strategies and business process re-engineering measures which shall guarantee profitability in both the current financial year and the years ahead.
“Our re-engineering process will center on three main pillars, namely Digital Transformation; Efficient Distribution Channels and Business Process Remodeling. As a group holding company with five subsidiaries across the insurance and financial services landscape, it has become of vital importance that we seek to improve our efficiency across the group by leveraging on cost discipline, astute capital allocation and investments and deployment of operational know-how to make Royal Exchange Plc a leaner, faster, smarter and customer-centric organization,” Muktari said.
He said the company has repositioned itself to meet the ever-changing needs of the clients, wherever they are, offering them products and services they want, when they want it and how they want it.
“For the future that we behold, our goal is to continuously redefine, reinvent and differentiate ourselves in the marketplace. The focus of the Board and Management of the Group is to achieve sustainable growth for the company through deepening our revenue base, improving service delivery and its support systems and at the same time, keeping costs in check,” Muktari said.