For the comparative period of the previous year, the Group registered a pre-tax profit of €13.5 million, which included a litigation loss provision of €75 million, the press statement adds.

Group operating income, which has remained at last year’s level, amounted to €127 million. Recurrent costs grew by 27% to €81m as compared to the same period a year earlier. BOV attributes the increasing costs chiefly to fees and expenses related to the ongoing transformation programme and on the substantial recruitment of resources in the group’s control functions. The impairment charge for the period is just under €1m, compared to reversals of €20 million booked for the corresponding period, the press statement adds.

Customer deposits grew by €223m to €10.6b by the end of the first half of the year as compared to December 2018. Net advances at amortised cost increased by €126m to €4.5b over the same period. Shareholders’ funds, comprising capital reserves, has topped the €1 billion mark for the first time in the Group’s history.

‘Full transformation mode’

BOV Chairman Deo Scerri underscored that the group is in a “full transformation mode” as BOV embarked on a two-year transformation programme, in agreement with its supervisors, with the assistance of two international consultancy firms.

“The aim is to ensure the long-term sustainability of the institution, by reducing the risk profile of the business model, strengthening capital buffers and enhancing the anti-financial crime framework. The increased costs reported in these results primarily reflect the costs of this programme. We do not see these costs as recurring overheads, but as a solid investment in the future,” Mr Scerri said.

“We are in the process of exiting a number of businesses and closing down a large number of higher-risk relationships, all of which naturally result in a loss of income. The situation is further impacted by heightened competition from non-traditional players and by the persisting low interest rate environment. Despite all this, the Group has managed to maintain the same income levels as last year. This shows the resilience of our core operations,” Mr Scerri added.

S&P’s rating comes expected

Standard & Poor’s has lowered the long term credit rating for the bank BBB with a negative outlook, to BBB- with a stable outlook. Short term rating was revised from A-2 to A-3. S&P justified its decision by stating perceived weaknesses in BOV’s internal control frameworks and to the potential impact of ongoing litigation cases. S&P named BOV’s sound franchise, customer confidence and ample liquidity as being among its major strengths.

Chairman Scerri said S&P’s decision had not come unexpected, in view that the rating outlook had already been set as “negative” last year. The chairman said that the underlying factors for the lowered rating — the need for strengthening internal controls, government and oversight — are being addressed in the transformation programme.

In reference to BOV’s USD clearing situation, Mr Scerri announced that Raiffeisen Bank International had recently opened accounts denominated in US dollars for BOV. He added that BOV’s short term objective is to put into place the necessary mechanism to enable it to offer full USD services, assuring that the bank is on the verge of achieving this objective. The longer-term objective is that the bank will have access to a wider network of USD correspondents.

“The Board has chosen to retain its prudent stance and has resolved not to declare an interim dividend, with the aim of further strengthening the Bank’s capital buffers, especially in the context of its status as a systemically important institution. This is in line with our strategy of foregoing short term benefits in the interest of long term stability. The situation will be re-assessed at the year-end, in consultation with supervisory authorities,” Mr Scerri said.

Mr Scerri expressed his full confidence in BOV’s future as a strong, secure and profitable institution. “The ongoing transformation programme will result in a stronger and safer bank, that will continue to play a leading role in tomorrow’s economy while delivering fair and sustainable returns to its shareholders,” the chairman added.

The post BOV records €54.3m pretax profit in H1 first appeared on The Malta Business Weekly.

MIA’s aviation (+11.1%) and non-aviation (+14.1%) segments both registered growth, with the improvement of the former being largely driven by a 13.2% increase in passenger traffic. In line with the hub’s diversification strategy, the company’s non-aviation activities also delivered positive results, contributing 28.9% to total revenues for the year, said the press statement sent to BM.

“Malta International Airport’s double-digit traffic increase for 2018 outpaced the average growth of its European peer group. However, this result did not come at the expense of service quality. In fact, in 2018 we were awarded the Best Airport in Europe title, in recognition of the great airport experience we provided our guests with,” Nikolaus Gretzmacher, Chairman of Malta International Airport, said in his opening address.

Mr Gretzmacher said that while figures speak for themselves, it must be acknowledged that they are the “result of ongoing work and tireless commitment, as well as close collaborations with key stakeholders, especially government when it comes to traffic development”.

Alan Borg, Chief Executive Officer of Malta International Airport, further elaborated on the companies performance, taking the floor after the chairman. Mr Borg highlighted that Malta International Airport is set to close off 2019 with another traffic milestone of 7.2 million passenger movements and with plans in hand for a number of infrastructural projects.

“The approval of our master plan was a very important development in 2018 and, together with our solid financial position, it will enable us to continue investing in the airport campus in its entirety over the long term, helping us honour our commitment of keeping the momentum of improvement going,” said Mr Borg, while noting that in 2019 alone the company’s investments will total over €20m.

The post Malta airport’s profits rise 25.6% to €30.3m in 2018 first appeared on The Malta Business Weekly.

Profit before tax amounted to GBP 17.7m, while profit after tax came to GBP 15.1m. Earnings per share were GBP 0.067.

Gross winnings revenue from the Swedish market for the first quarter of 2019 amounted to SEK 207.4m after deduction of bonuses of SEK 137.9m.

The number of active customers during the first quarter was 1,631,636. “All-time high in active customers but, as expected, profits for the quarter significantly impacted by the new local licence in Sweden,” said Henrik Tjärnström, CEO of Kindred Group.

The CEO praised “strong levels of activity” across all markets and “all-time highs” for active customers and sports betting turnover. According to the CEO, investment in marketing activities focusing on responsible gambling in Sweden and football sponsorships in the United Kingdom were the main drivers of the results.

Swedish market reregulation leads to short-term margin pressure

“As anticipated for several years, the reregulation of the Swedish market resulted in significant short-term margin pressure, particularly in the first quarter. The single biggest impact came from all legacy and new Swedish customers being awarded one additional bonus under the terms of the new licensing system,” according to the CEO.

“The significant uptake on customer bonuses, especially in January and February, resulted in bonus expenditure increasing with GBP 6.6m for the first quarter compared with the same period last year. Bonus costs stabilised later in the quarter and by March, they were lower than last year with full-year costs expected to be lower than for 2018,” Mr Tjärnström added.

Gross winnings revenue, as well as EBITDA, was significantly affected by the Swedish betting duties paid of GBP 5.2m but also marketing investments increasing with GBP 3.8m, the press statement by the group says. “The total effect on Group EBITDA from the Swedish market opening in the first quarter was a reduction of GBP 18.9 million compared to the first quarter last year,” the CEO said.

Gross winnings revenue from mobile grew by 17% in the first quarter of the year as compared to the same period a year earlier, and amounted to 77% of the group’s total gross winnings revenue, while some 57% of the group’s gross winnings revenue, came from locally-regulated markets.

“For the period 1 April to 21 April 2019, the daily average Gross winnings revenue in GBP was 10 per cent higher (12 per cent in constant currency) than for the same period last year,” Mr Tjärnström added.

The post Kindred’s gross winnings revenue ups 8% in Q1 2019 first appeared on The Malta Business Weekly.

At the end of last year, the company says to have strengthened its balance sheet by allocating €173, to a “partial impairment of goodwill for operations” in the United States, Italy and Indonesia. After allowing for this allocation, net earnings for the year were €529m, 24.5% lower as compared to 2017.

Premiums for the EURASIA Regional Area (grouping operations in Europe with the exception of Spain and Portugal, the Middle East, Africa and Asia) dropped by year-on-year 5.6% to €1.77bn, the figures published in the press statement show.

Malta contributed €390m, representing the highest growth in this region, with an increase of 11%, the press statement says.

Mapfre Middlesea Plc (C-5553) is authorised by the Malta Financial Services Authority to carry on both Long Term and General Business under the Insurance Business Act, Cap 403 of the Laws of Malta. Mapfre MSV Life Plc is authorised by the Malta Financial Services Authority to carry on Long Term Business under the Insurance Business Act, Cap 403 of the Laws of Malta. MFSA regulates both entities.

The post Mapfre generates €702m operating in 2018, Malta outperforms peers first appeared on The Malta Business Weekly.