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QBE Insurance Group Ltd (ASX:QBE) has seen its share price plunge on the back of half yearly results, despite reporting a doubling of its profit in the first half of 2024 compared to the corresponding period last year.
By 13:11 AEST, QBE shares were trading at $15.85, a fall of 2.94% since the market opened.
The insurer told investors that in the first half of the year, its statutory net profit had come in at US$802 million, up from US$400 million in 1H23.
Nevertheless, the selloff was significant, with some suggestion that this was due to the topline figure coming in under Goldman Sachs’ expectations for QBE, with a prediction of US$818 million for the half yearly result.
In other details form the report, QBE’s board declared an interim dividend of 24 Australian cents per share – up from 14 Australian cents per share in 2023, with this representing a payout ratio of 31% of adjusted net profit.
The insurer also said its combined operating ratio had improved to 93.8% from 98.8% in the prior period, on the back of lower catastrophe costs and more stable reserve development.
Also today, the company announced important reserve transactions which are set to de‑risk $1.6 billion in reserves, and reduce risk associated with the run-off of North America non-core lines.
CEO Andrew Horton said decisions being made during this period would bolster QBE in the years to come.
“We delivered a series of important initiatives through the period to support greater resilience and consistency,” he said.
“The shape and health of our underwriting portfolio has improved materially over recent years, and as a result, our priorities are becoming more future-focused.
“We announced our decision to commence an orderly closure of North America middle-market, which supports our continued focus on portfolio optimisation and improving performance in North America.
“This will allow us to refocus our North America strategy on those businesses which hold more meaningful market position, relevance and scale.”
QBE has been trading at $16.33.
