KUALA LUMPUR (Aug 24): Allianz Malaysia Bhd saw its net profit for the second quarter ended June 30, 2022 (2QFY22) drop 33.55% year-on-year to RM96.62 million from RM145.41 million, dragged mainly by lower profit from its life insurance segment.

Earnings per share declined to 36.16 sen from 82.17 sen, according to Allianz Malaysia’s filing with Bursa Malaysia on Wednesday.

Quarterly revenue, in contrast, increased 5.47% to RM1.65 billion from RM1.57 billion mainly due to higher gross earned premiums and investment income by RM73.3 million and RM12.5 million respectively.

Profit before tax (PBT) for the group’s life insurance segment plunged 91.4% to RM8.3 million compared with RM96.9 million a year ago amid higher claims and fair value losses on investment. Loss before tax in its investment holding segment also increased to RM6.4 million from RM5.6 million mainly due to higher expenses.

PBT of its general insurance segment meanwhile rose marginally to RM116.7 million from RM115 million, contributed by higher underwriting profit and lower management expense.

Cumulatively, Allianz’s net profit in the six months ended June 30 slipped 5.14% to RM197.935 million from RM208.67 million despite six-month revenue rising 5.89% to RM3.36 billion from RM3.175 billion.

On prospects, the group said the second half of the year (2H22) will likely be challenging for both the general and life insurance segments amid ongoing global uncertainties such as supply chain disruptions, higher inflation and lower real disposable income.

The higher inflation may impact claim costs while lower disposable income may impact consumers’ purchasing power and spending on longer-term commitments such as insurance products, it said.

To remain competitive, Allianz said it continues to make investments in talent, digital and distribution channels and execute its strategic initiatives.

In addition, it will also focus on accelerating digital capabilities to ensure scalability as the business grows and to create timely customer focused solutions.

“The group is committed to generating shareholder value. The solid foundation of the group from its diverse business and strong execution of its strategic initiatives will position the group to deliver sustainable profitable growth,” Allianz told Bursa.

Allianz closed unchanged at RM13.20 on Wednesday, giving it a market capitalisation of RM2.35 billion.