KUALA LUMPUR: LPI Capital Bhd
expects to deliver sustainable growth in its current financial year ending Dec 31, 2023 (FY23) despite the challenging environment.
Over the coming term, the insurer said it will continue to pursue growth in profitable segments and improve operational efficiency through ongoing digital transformation.
This comes as it recorded a “creditable performance” in the third quarter ended Sept 30, 2023, with a net profit of RM97.37mil, compared with RM79.18mil in the same period in 2022.
It reported revenue of RM498.4mil, an increase from RM434.05mil in the third quarter of financial year 2022 (3Q22), largely owing to the performance of its general insurance segment.
Earnings per share rose to 24.45 sen from 19.87 sen previously.
For the quarter under review, the group’s wholly-owned insurance unit Lonpac Insurance Bhd reported improved profitability due to higher returns from its investment portfolio and better insurance service result.
The unit’s pre-tax profit rose to RM101.5mil in 3Q23 from RM92mil a year earlier.
“Lonpac’s insurance service result grew 3.8% year-on-year to RM88.5mil from RM85.3mil, due primarily to a lower net claims incurred ratio, which came in at 39.4% as compared to 43.4% reported in 3Q22.
“Both motor and marine insurance business segments registered an improvement in claims experienced for the quarter under review,” it said.
For the first nine months of the financial year ended Sept 30, 2023, the group recorded a net profit of RM235.15mil, compared with RM197.61mil in the same period a year ago.
The group’s revenue rose to RM1.42bil from RM1.25bil on a year-on-year basis.
In a statement, LPI said Malaysia’s economy grew moderately in the first nine months of 2023, even as advanced economies continued to struggle with containing inflation.
“However, persistent negative growth in Malaysia’s total trade over the past several months signals a challenging outlook for the country.
“This trend is attributed to weaker external demand, which in turn continued to exert pressure on growth.
“In response to the current economic environment, the government has intensified efforts to create an attractive investment ecosystem to attract foreign direct investments and encourage domestic direct investments.”
LPI added that global macroeconomic risks such as the impact of higher interest rates and geopolitical tensions will likely persist in the near term.
“Malaysia’s economic growth is presently driven mainly by domestic growth, which is expected to be sustained by continued consumer spending, the recovery of the tourism sector and the rolling out of government infrastructure projects.
“The LPI group will continue to pursue growth in profitable segments and improve operational efficiency through its ongoing digital transformation,” it said.
Despite the challenging environment, LPI said it will continue to execute its strategic initiatives prudently and deliver sustainable growth for FY23.
