Menora Mivtachim (MMHD) Q1 2023 earnings summary

Executive summary

• Q1 net income was ₪85m, down 63.1% YoY; net income attributable to shareholders was ₪79m versus ₪230m.

• Total comprehensive income rose to ₪159m from ₪112m, reflecting the swing in investment results.

• Assets under management reached ₪284bn, up 8.4% YoY; premiums, contributions and investment-contract receipts totaled ₪7,257m, also up 8.4%.

• Underwriting profit before tax was ₪130m.

Financial highlights

• Net investment gains and finance income were ₪765m versus a ₪295m loss in Q1 2022; pre-tax profit was ₪102m versus ₪351m.

• A ₪120m pre-tax gain from revaluation of owned real estate was included in investment gains.

• Total assets were ₪67.6bn at March 31, 2023; shareholders’ equity was ₪5.95bn, versus ₪5.90bn at year-end 2022.

• Total premiums, contributions and investment-contract receipts rose to ₪7,257m from ₪6,691m in Q1 2022.

Outlook and guidance

• IFRS 17 and IFRS 9 implementation in Israel was postponed to January 1, 2025; transition date is January 1, 2024, with pro forma disclosures planned during 2024.

• Bank of Israel forecasts GDP growth of 2.5% in 2023 and 3.5% in 2024; policy rates were expected to rise further to curb inflation.

• Proposed health-insurance reforms and life-policy commission changes may affect product pricing, coverage, discounts and retention; outcomes depend on final rules and customer and competitor behavior.

• New sustainability investment tracks offer up to 80% equity exposure and over 50% foreign-currency exposure; passive index-linked options were introduced for insurance and savings products.