Africa Re Q1 2026 Results Show Premium Growth Amid Profit Pressure

African Reinsurance Corporation, headquartered in Nigeria, recorded gross written premiums of $316.3 million in the first quarter of 2026, representing a 9.9% increase from $287.8 million in the same period of 2025. Even with this growth in written business, the quarter reflected softer earned premium performance, as gross earned premiums declined by 4.8% to $249.5 million and net earned premiums slipped 3.2% to $200.9 million.

Profitability also came under pressure during the period. Under IFRS 4, the reinsurer posted net profit after tax of $12.8 million, down 43% from $22.4 million a year earlier. The company attributed the slower conversion of written premium growth into IFRS 17 revenue mainly to higher reserves for unexpired risks, which weighed on reported earnings for the quarter.

Revenue and underwriting movement in Q1 2026

On an IFRS 17 basis, reinsurance revenue fell 4.8% year on year to $249.5 million from $262.1 million. Reinsurance service expense improved, declining by 5.8% to $184 million, yet this reduction was not sufficient to fully counterbalance the drop in revenue. As a result, reinsurance service result before retrocession edged down to $65.5 million, compared with $66.8 million in Q1 2025.

The impact of retrocession was more pronounced during the quarter. Net expense from retrocession contracts held rose to $34.8 million from $32.5 million, mainly because recoveries from retrocessionaires were lower than in the prior-year period. Consequently, the net reinsurance service result declined by 10.5% to $30.7 million.

Investment performance and profit outcome

Africa Re reported some support from the interest rate environment, as net reinsurance finance expense eased to $11.6 million from $12.5 million in Q1 2025. However, this improvement only partially softened the broader decline in operating performance. Under IFRS 17, net profit after tax came in at $16 million, a 37.4% fall from $25.6 million a year earlier, translating into a 6.4% profit margin on reinsurance revenue.

Investment returns were also weaker. Net investment income dropped 20.3% to $17.5 million from $22 million, while under IFRS 4, investment and other income decreased 23.9% to $16.6 million. According to the company, this was largely linked to capital losses on listed equities and bonds, as market valuations were affected by geopolitical tensions in the Middle East.

Balance sheet resilience and management outlook

Despite pressure on earnings, the corporation preserved a solid financial position. Total assets increased to about $2.191 billion in Q1 2026, up from $2.167 billion at the end of 2025, underscoring the strength of its balance sheet during a volatile operating environment.

Commenting on the quarter, Group Managing Director and Chief Executive Officer Dr. Corneille Karekezi said the performance reflected the company’s resilience despite weaker earned revenue, reduced retrocession recoveries, and unsettled financial markets. He added that although profitability moderated from a strong prior-year base, it remained within the group’s expectations and risk appetite.

Africa Re indicated that its underwriting discipline, portfolio optimisation efforts, and prudent investment management will remain central to its strategy through the rest of 2026, as it seeks to sustain long-term value creation in a challenging market backdrop.