Notice to the Market – Periodic Information For
Notice to the Market - Page 1 of 7
Corporate Taxpayer's ID (CNPJ): 33.376.989/0001-91
Company Registry (NIRE): 333.0030917-9
NOTICE TO THE MARKET
informs its shareholders and the market that it made available the periodic monthly report sent to the Brazilian Insurance Regulator (SUSEP), through the Periodic Information Form (FIP). For better understanding, once the FIP meets the requirements of the chart of accounts established by the regulatory authority, the Company made available on its website a spreadsheet containing the financial data for the month of
Management Discussion and Analysis
The analyses contained in this report, except as stated otherwise, are based on the management format called Business View. This format, besides consolidating the accounting information of the companies controlled by IRB(Re), also groups some accounting records of the statements of profit or loss in a way different from that established in the accounting practices adopted in
Main Highlights
Company's figures
4Q23:
- Reduction of written premiums by 12%, in line with the portfolio clean-up strategy;
- Reduction of the retained claim volume by 56%, with loss ratio of 55%, down 39 p.p. from the 4Q22; and
- Net income of
R$37.9 million , compared to a loss ofR$38.8 million for the 4Q22.
2023:
- Underwriting profit reached
R$ 155 million for 2023, the best result since 2019, demonstrating
the Company's consistent recovery;
- As a result of the strategies adopted during 2023, the combined ratio improved 28.1 p.p.,
totaling 108.6% for the year;
- Net income of
R$114 million , compared to a loss ofR$630 million for 2022.
Notice to the Market - Page 2 of 7
Operating performance
- Payment of the first series of the first debenture issue:
R$ 487.3 million onOctober 16, 2023 ; - Start of the process of sale of the Company's
London branch; - Volunteer Dismissal Program in December, accepted by 31 people.
Main Highlights
(R$ in millions)
|
P&L - Business View |
4Q22 |
4Q23 |
∆% |
12M22 12M23 ∆%
|
Written premiums |
1,789.8 |
1,575.5 |
-12% |
7,892.0 |
6,521.1 |
-17% |
|
Reinsurance premiums BR |
1,244.3 |
1,305.2 |
5% |
5,377.5 |
4,980.5 |
-7% |
|
Reinsurance Premiums Abroad |
545.5 |
270.3 |
-50% |
2,514.5 |
1,540.6 |
-39% |
|
Retroceded premiums |
(744.2) |
(744.1) |
0% |
(2,923.9) |
(2,583.1) |
-12% |
|
Retained premiums |
1,045.6 |
831.4 |
-20% |
4,968.1 |
3,938.0 |
-21% |
|
Changes in Technical Reserves |
373.6 |
239.2 |
-36% |
129.5 |
213.2 |
65% |
|
Earned Premiums |
1,419.2 |
1,070,5 |
-25% |
5,097.6 |
4,151.2 |
-19% |
|
Retained Claims |
(1,331.0) |
(591.2) |
-56% |
(5,314.9) |
(2,906.8) |
-45% |
|
OCR |
(973.7) |
(693.6) |
-29% |
(5,077.1) |
(3,011.8) |
-41% |
|
IBNR |
(357.4) |
102.4 |
-129% |
(237.8) |
105.0 |
-144% |
|
Acquisition Costs |
(248.7) |
(374.4) |
51% |
(1,102.8) |
(1,047.2) |
-5% |
|
Other Operating Income and |
7.8 |
0.2 |
-98% |
(129.4) |
(42.2) |
-67% |
|
Expenses |
||||||
|
Underwriting Profit or Loss |
(152.8) |
105.1 |
- |
(1,449.4) |
155.0 |
- |
|
Administrative Expenses |
(92.4) |
(103.6) |
12% |
(329.7) |
(354.0) |
7% |
|
Tax expenses |
(14.0) |
(42.8) |
206% |
(87.9) |
(156.0) |
77% |
|
Finance Income and Share of Profit of |
153.0 |
124.6 |
-19% |
690.1 |
548.7 |
-20% |
|
Equity-Accounted Investees |
||||||
|
Finance Income |
99.3 |
111.4 |
12% |
608.9 |
507.8 |
-17% |
|
Share of Profit of Equity-accounted |
53.7 |
13.2 |
-75% |
81.2 |
40.9 |
-50% |
|
Investees |
||||||
|
Net income before taxes |
(106.1) |
83.3 |
- |
(1,176.9) |
193.8 |
- |
|
Taxes and Contributions |
67.3 |
(22.3) |
- |
546.5 |
(41.8) |
- |
|
Profit sharing |
- |
(23.1) |
- |
- |
(37.7) |
- |
|
Total Net Income (loss) |
(38.8) |
37.9 |
- |
(630.3) |
114.3 |
- |
4Q22
4Q23
- p.p
12M22
12M23
∆p.p
|
Retention Ratio |
58.4% |
52.8% |
-5.7 |
63.0% |
60.4% |
-2.6 |
|
Retrocession Ratio |
41.6% |
47.2% |
5.7 |
37.0% |
39.6% |
2.6 |
|
Loss ratio |
93.8% |
55.2% |
-38.6 |
104.3% |
70.0% |
-34.2 |
|
Loss ratio measured by OCR |
68.6% |
64.8% |
-3.8 |
99.6% |
72.6% |
-27.0 |
|
Loss ratio measured by IBNR |
25.2% |
-9.6% |
-34.7 |
4.7% |
-2.5% |
-7.2 |
|
Commission Ratio |
17.5% |
35.0% |
17.4 |
21.6% |
25.2% |
3.6 |
|
Administrative Expense Ratio |
6.5% |
9.7% |
3.2 |
6.5% |
8.5% |
2.1 |
|
Combined Ratio |
118.3% |
103.9% |
-14.4 |
136.6% |
108.6% |
-28.1 |
Notice to the Market - Page 3 of 7
Written Premiums (R$ in millions)
|
-17% |
||||||||||||
|
7.892 |
||||||||||||
|
Strategy in implementation: |
||||||||||||
|
2.515 |
6.521 |
Focus on |
||||||||||
|
-39% |
1.541 |
|||||||||||
|
of 80% in local premiums |
||||||||||||
|
Focus on LatAm: target of 15% to |
||||||||||||
|
5.377 |
-7% |
4.980 |
20% in premiums |
|||||||||
|
Select operations in |
||||||||||||
|
10% of the portfolio |
||||||||||||
|
12M22 |
12M23 |
|||||||||||
|
|
Abroad |
|||||||||||
Retained claims and Loss ratio
(R$ in millions | %)
|
8.000 |
104% |
110% |
||||
|
7.000 |
90% |
|||||
|
6.000 |
5.315 |
|||||
|
70% |
70% |
|||||
|
5.000 |
||||||
|
4.000 |
2.907 |
50% |
||||
|
3.000 |
||||||
|
30% |
||||||
|
2.000 |
||||||
|
10% |
||||||
|
1.000 |
||||||
|
- |
-10% |
|||||
|
12M22 |
12M23 |
|||||
|
Retained claims |
Loss ratio |
|||||
Improvement in the loss ratio by 34.2 p.p., a result of the pricing strategy and risk selection.
Underwriting Result (R$ in millions)
155
Underwriting profit in all quarters of 2023, totaling
-1.449
12M2212M23
Notice to the Market - Page 4 of 7
Net Income (R$ in millions)
114
Net profit in all quarters of 2023, a result of the strategy with focus on combined ratio reduction.
-630
12M2212M23
Notice to the Market - Page 5 of 7
Q&A
The analyses contained in this report, except as stated otherwise, are based on the management format called Business View. This format, besides consolidating the accounting information of the companies controlled by IRB(Re), also groups some accounting records of the statements of profit or loss in a way different from that established in the accounting practices adopted in
The CVM Resolution 42/2021 requires that beginning on
IRB(Re), as an entity that is also regulated by the Brazilian Insurance Regulator (SUSEP), shall present its statements according to the CPC 11 (IFRS-4), once the Regulatory Authority has not adopted the CPC 50 (IFRS17) yet.
1 - Why did IRB(Re) disclose the publication of results earlier?
The disclosure of the results for the 4Q23 and 2023 was not made earlier. We are overseen by SUSEP, the authority that oversees the insurance and reinsurance sector, and by the CVM, the regulatory authority of capital markets. We meet the deadlines for disclosure of results following the agenda of each regulatory authority.
2 - Will the Company disclose results twice?
No. IRB(Re) reports its figures according to the regulatory requirements of SUSEP and CVM. The publication made on
3 - Why doesn't IRB(Re) make both disclosures on the same date as it used to do?
As mentioned in the previous answers, the Company will disclose its results as required by the regulatory authority. The financial statements that shall be filed with CVM on
Notice to the Market - Page 6 of 7
4 - What is the difference between the disclosures?
The individual financial statements for
5 - Is the information disclosed in the SUSEP GAAP format audited?
Yes, both the disclosure to SUSEP and CVM are audited by KPMG Auditores Independentes Ltda.
6 - Why will IRB(Re) change the accounting standard of the disclosures to CVM?
As of the CVM Resolution 42, dated
7 - What is the IFRS-17?
It is the International Financial Reporting Standard issued by the
8 - For analysis purposes, which disclosure should be considered?
Each investor or analyst should decide which disclosure is more appropriate. This Management Discussion and Analysis Report was made based on the Business View, following the same standard adopted for previous quarters.
9 - What are the highlights in relation to the results estimated by IRB(Re) for 2023?
The Company recorded a net income of
10 - What is the Company's evaluation of the annual result?
In 2023, the Company made many significant achievements: reported an underwriting profit of
Notice to the Market - Page 7 of 7
11 - What is the result by business line?
The disclosure of the company's profit & loss by business line, according to the Business View, shall be made on
12 - Does IRB(Re) report sufficient Regulatory Ratios?
According to the Management Report, presented with the financial statements, in relation to the (i) Sufficiency of Adjusted Equity, the Company reported as at
13 - Will IRB(Re) distribute dividends?
According to IRB(Re)'s by-laws, the calculation of the distribution of mandatory minimum dividend is made based on the profit for the year after deduction for retained losses, the provision for income tax and legal reserve. Such amount is recorded as liability in the line item trade payables, as it represents a legal obligation established in the Company's bylaws.
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