Tunisian insurer STAR has announced a 31.9% increase in its semestral profit to 28.1 million Tunisian dinars (MDT). The company's growth was driven by a strong performance in both its life and non-life insurance businesses. STAR's life insurance business reported a 16.2% increase in premiums, while its non-life business saw a significant increase in investment income. The company's results were also impacted by a decrease in its effective tax rate.
STAR's life insurance business accounted for 14.4% of its net premiums, but generated 65.8% of its technical result, or 9.5 MDT. However, the business reported a 18.3% decline in profit to 9.5 MDT, driven by a decline in investment income. The company's non-life business reported a technical result of 4.9 MDT, after 44.0 MDT of investment income. Without investment income, the non-life business would have reported a loss of 39.1 MDT.
The company's results were also impacted by a social control notification received on May 18, 2026. The notification relates to STAR's social obligations from January 1, 2023, to December 31, 2025. The company's auditors noted that the impact of the social control on STAR's financial statements cannot be precisely estimated. STAR's provisions for risks and charges totaled 14.9 MDT, with no breakdown provided.
STAR's financial statements also revealed a significant increase in its debt. The company's other debts, which include trade creditors and charges to pay, increased to 116.5 MDT, from 102.7 MDT a year earlier. The company's cash flow from operations declined to 15.6 MDT, from 74.2 MDT a year earlier. STAR's investment portfolio included 555.0 MDT of Treasury bonds and assimilable bonds.
The company's plans to create a life insurance subsidiary are ongoing, with STAR continuing to prepare for the launch of the new business. However, no details were provided on the capital, timeline, or scope of the subsidiary. Analysts noted that the life insurance business is heavily reliant on investment income and death benefits.
STAR's financial statements also revealed a significant decline in its cash flow. The company's cash flow from operations declined to 15.6 MDT, from 74.2 MDT a year earlier. The company's dividend payment also ceased, with no dividend paid out during the period, compared to 19.4 MDT a year earlier.
The company's management did not comment on the results or the analysis provided by analysts. STAR's results are seen as a positive development for the Tunisian insurance sector, but concerns remain about the company's debt levels and the impact of the social control on its financial statements.
Key points
- STAR reports a 31.9% increase in semestral profit to 28.1 MDT.
- The company's life insurance business accounts for 14.4% of net premiums but generates 65.8% of technical result.
- STAR's plans to create a life insurance subsidiary are ongoing, but no details were provided on the capital, timeline, or scope.
