Migdal Insurance and Financial Holdings (MGDL) Q1 2022 earnings summary

Executive summary

• Q1 2022 net income was ₪936m versus ₪315m in Q1 2021; comprehensive income was ₪294m, up 26% from ₪233m.

• A ₪1.656bn pre-tax rate-driven gain from lower insurance liabilities offset much of the investment losses.

• Gross premiums and contributions rose 20% to ₪6.9bn.

Financial highlights

• Revenue was ₪2.257bn versus ₪9.149bn; net investment results were a ₪1.231bn loss versus a ₪5.183bn gain.

• Pre-tax profit was ₪1.417bn versus ₪481m; basic and diluted EPS was ₪0.89 versus ₪0.30.

• Other comprehensive loss was ₪642m versus ₪82m; equity was ₪8.858bn at March 31, 2022, versus ₪8.564bn at year-end 2021.

• Nostro investment results were a ₪267m loss versus a ₪440m gain in Q1 2021.

Segment performance

• Life and long-term savings pre-tax comprehensive profit was ₪442m versus ₪419m; a ₪871m rate-related gain outweighed a ₪525m investment loss.

• Health pre-tax comprehensive profit was ₪631m versus a ₪46m loss; a ₪776m reserve gain outweighed a ₪159m investment loss.

• General insurance pre-tax comprehensive loss was ₪239m versus ₪14m profit; underwriting loss widened to ₪81m, concentrated in motor lines, and investment loss was ₪166m.

• Financial-services revenue rose to ₪59m from ₪55m, while comprehensive profit declined to ₪11m from ₪15m, mainly due to higher variable expenses.

• Life premiums rose 1% to ₪1.889bn; single premiums and investment-contract receipts rose 118% to ₪1.288bn, pension contributions 11% to ₪2.009bn, and provident-fund contributions 25% to ₪556m.