Investor Relations

Dear Shareholders and Stakeholders,

In 2022, we witnessed evolving customer expectations, technological disruptions, and shifting regulatory dynamics. However, despite these complexities, Continental Re emerged stronger and more resilient. Our strategic positioning, diverse product portfolio, and customer-centric approach to business ensured we maintained our competitive edge and exploited market opportunities. Continental Re recorded remarkable achievements in 2022 with impressive growth in revenue from all lines of business. Our performance has once again demonstrated Continental Re’s ability to deliver even in difficult times.

Operating Environment

When we set out our result target for 2022, no one could have imagined the geopolitical and macroeconomic upheavals the year would have in store: the Russian military intervention and the ensuing economic turbulence were not foreseeable. Consequently, our investments were subject to significant volatility. The ongoing conflict between Russia and Ukraine has had a significant impact on energy costs, contributing to the escalation of global inflation that was already on the rise. Considering this situation, we have taken measures to accommodate the anticipated increase in claims expenditure due to the upward trend in inflation.

According to data from the IMF, the global economy demonstrated a growth rate of 3.4% in 2022, surpassing the earlier forecast of 3.2% that was made in October 2022. However, it is essential to note that this figure fell significantly short of the initial projection of 4.4% put forth in January 2022. This discrepancy arises from the anticipation of a gradual return to normalcy in the global economy, which, unfortunately, did not materialize as expected. Key economies, including the United States, China, and the Euro Area, reported slower growth rates compared to the previous year, with growth estimated at 2.1% (compared to 2.1% in 2021), 3.0% (down from 8.5% in 2021), and 3.5% (down from 5.4% in 2021), respectively.

In Africa, while many economies continued their recovery from the pandemic’s effects, the growth remained insufficient to return them to pre-pandemic levels. According to the African Development Bank, in 2022 Central Africa recorded significant growth of 4.7%, driven by favourable commodity prices, while Southern Africa decelerated to approximately 2.5% due to subdued growth in South Africa. West Africa’s growth stood at 3.6%, reflecting the slowdown in Côte d’Ivoire and Nigeria, and North Africa declined to 4.3% due to a sharp contraction in Libya and drought in Morocco. East Africa also experienced a slowdown to 4.2% due to rising inflation and climate shocks. The African continent experienced varied economic dynamics in 2022, with some regions showing resilience and growth while others faced challenges such as political instability, currency fluctuations, and infrastructure deficits. Our ability to adapt to these regional nuances while maintaining a long-term perspective remained vital.

The regulatory environment for the industry continued to evolve. Compliance with changing regulations, including solvency requirements and reporting standards, remained a priority. We embraced these changes as opportunities to enhance our governance, risk management, and transparency. Also, the rapid pace of technological advancements presented both opportunities and challenges. The increasing digitalization of the insurance and reinsurance value chain required us to invest in technology to remain competitive and relevant. We continued our digital transformation journey to improve efficiency and offer innovative solutions to our clients.

Performance Summary

Despite the volatile market conditions, our key performance indicators attest to the fact that Continental Re is heading in the right direction. In 2022, the group’s Gross written premium grew year-on-year by 47% to NGN103.21 billion (USD242.589 million), Profit before tax (PBT) grew year-on-year by 27% to NGN8.43 billion (USD19.829million), Underwriting profit grew year-on-year by 31% to NGN5.28 billion (USD12.4million) and Investment income increased by 59% to NGN3.99billion (USD9.38million) compared to NGN2.51 billion(USD6.26million) in 2021 with interest income from bonds and statutory deposit dominating our investment income. The combined ratio closed at 91.7% – better than the average on the continent which is approximately 100%. The group also delivered a return on equity (ROE) of 15% while maintaining its B+ AM Best rating.

Strategy Review

In pursuit of our long-term vision, which is to establish ourselves as the premier Pan-African reinsurer, Continental Re’s Board and Management have recently updated our medium-term strategy for the years 2022 to 2024. This strategic update places a strong emphasis on four pivotal objectives aligned with our ambition. These objectives include achieving profitable growth, becoming a customer-centric company, achieving operational excellence, and building a smart execution culture.

We firmly believe that a relentless focus on these four goals will propel us toward the realization of our vision. In our pursuit of profitable growth, we will continue to prioritize disciplined underwriting practices within carefully selected client segments, markets, and lines of business to ensure that we expand our market share without compromising shareholder value. We will also continue to enhance our asset management capabilities to optimize investment returns, recognizing that premium collections play a pivotal role in boosting investible funds and, consequently, our investment returns.

Acknowledging the challenge of premium collection prevalent across Africa, we are committed to implementing a range of initiatives to address this issue effectively. We aim to further fortify our financial position and drive sustained growth as we continue our journey to become the premier Pan-African reinsurer.

Risk Management and Compliance

In an increasingly complex risk landscape, we maintained a strong focus on risk management and compliance. We continuously monitored and assessed risks, ensuring robust underwriting practices. Our risk management framework has enabled us to maintain a healthy risk appetite, while diligently adhering to regulatory requirements and industry best practices. We are committed to upholding the highest standards of governance and transparency.


Talent Management


At Continental Re, we are very conscious of the fact that building a culture of high performance among employees goes a long way to ensuring competitiveness and attracting the best talents. As an organization that aims to recruit and keep the best talent, we have revamped our employee management practice, ensuring that remuneration and other levers of employee engagement are benchmarked against leading organizations. We have placed a high value on learning and development, and to this end, we continuously invest in training programs targeted at improving staff skills and capacity across various functions.

Conclusion

While we hold optimistic expectations for the year 2023, we are fully aware of the unpredictable nature of geopolitics and the economy, as well as the potential impact of regulatory changes, foreign exchange fluctuations, and shifting customer preferences. These obstacles have necessitated our ability to adapt quickly, think creatively, and implement innovative approaches to ensure our business remains relevant.

On behalf of the Board, I would like to thank all our employees for their dedication, our customers for their loyalty and patronage, and our shareholders for your patience and confidence in our Board and Management. We remain focused on our mission to protect and serve our customers, generate sustainable returns for our shareholders, and contribute to the growth and development of Africa’s reinsurance sector. Together, we will navigate the challenges and capitalize on the opportunities, ensuring a bright and prosperous future for Continental Re.

Lawrence Nazare,
Group Managing Director

Latest Financial Results

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Q2 2020

Quarter Ended Jun 27, 2020


Earnings Presentation 1PDF


Earnings Presentation 2PDF


Earnings Presentation 3PDF


Press Release 1PDF


Press Release 2PDF


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