In brief
- Profitability under pressure despite revenue strength: EGL’s 9M2025 profit after tax declined 7.1% y/y to GHS 289.2mn, as higher insurance finance expenses, weaker reinsurance results, and rising operating costs outweighed strong topline growth. Insurance revenue rose 10.9% y/y to GHS 1.33bn, while investment income surged 232.8% y/y to GHS 411.0mn on higher yields and portfolio expansion.
- Balance sheet growth and resilient cash generation: Total assets expanded 26.4% y/y to GHS 4.6bn, supported by a 40.7% rise in investment securities to GHS 3.0bn. Equity increased 3.7% y/y to GHS 1.77bn, and operating cash flow strengthened to GHS 690.9mn, underscoring solid liquidity and balance sheet resilience despite margin pressures.
- Macro tailwinds to lift growth and margins: We expect disinflation and lower interest rates to boost disposable incomes, support higher-value policy uptake, and ease cost pressures. Lower funding costs and stable investment returns should aid margin recovery, with overall earnings impact likely neutral to slightly positive.
- Regulatory and digital reforms to expand reach: The new Bancassurance Directives and NIC reforms will enhance distribution and strengthen trust, while EGL’s digital investments will drive efficiency, customer growth, and scalability across core business lines.
Margins pressured despite topline growth and investment gains
Enterprise Group Plc’s (EGL) 9M2025 results showed a 7.1% y/y decline in profit after tax to GHS 289.2mn, from GHS 311.2mn in the same period last year. The decline reflected weaker reinsurance outcomes, a sharp rise in net insurance finance expenses, and higher operating costs, which outweighed strong insurance and investment income growth. Insurance revenue increased 10.9% y/y to GHS 1.33bn, supported by volume gains across life and non-life businesses. Investment income surged 232.8% y/y to GHS 411.0mn, driven by higher yields and an expanded securities portfolio. However, these gains were offset by a GHS 175.4mn reinsurance loss, a 224.7% jump in insurance finance expenses to GHS 274.0mn, and a GHS 50.1mn loss in other income. On the balance sheet, total assets expanded 26.4% y/y to GHS 4.6bn, supported by a 40.7% increase in investment securities to GHS 3.0bn. Equity improved 3.7% y/y to GHS 1.77bn, reflecting retained earnings and reserve transfers. Despite margin pressures, operating cash flow remained strong, rising to GHS 690.9mn. Looking ahead, we believe the continued decline in discount rates could further elevate the value of insurance liabilities and increase finance expenses. Profitability will depend on stable reinsurance recoveries, disciplined cost management, and the sustainability of investment income gains.