Munich Re Backs 2023 After 1Q Net Profit Decline on High Major Losses

   By Adria Calatayud 
 

Munich Re said Wednesday that first-quarter net profit declined but beat expectations after it was hit by major losses, and confirmed its guidance for the full year.

The German reinsurer said net profit for the first three months of the year was 1.275 billion euros ($1.39 billion) compared with EUR1.475 billion in the year-earlier period. In preliminary figures released late last month, the company said net profit of EUR1.3 billion would beat consensus expectations of EUR1.01 billion.

Munich Re said insurance revenue from insurance contracts issued was EUR14.27 billion, up from EUR13.26 billion in the same period last year. In the company's reinsurance segment, insurance revenue from insurance contracts increased to EUR9.23 billion from EUR8.66 billion a year before, Munich Re said.

The reinsurer said major losses of more than EUR30 million each totaled EUR1.035 billion in the quarter, up from EUR618 million a year before, and that its major-loss expenditure represented 16.4% of insurance revenue and above the long-term average of 14%.

Major losses from natural catastrophes rose to EUR870 million, nearly doubling on year, and included the earthquake that hit Turkey on the border with Syria in February.

Munich Re said it still anticipated a net result of about EUR4 billion for the 2023 financial year, but that profitable growth confirmed by its reinsurance renewals as of April 1 mean the chances of surpassing that target have increased.

Write to Adria Calatayud at [e-mail]

(END) Dow Jones Newswires

May 17, 2023 01:58 ET (05:58 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.