On 23 March, GlobalCapital plc published their full year results for 2011. During the year ended 31 December 2011, the Group reported a loss after tax of €4.19 million (2010: loss of €8.25 million). For the fifth consecutive year, GlobalCapital did not declare a dividend to its shareholders.
GlobalCapital reported that its 2011 operating performance was impacted by the continued volatility in the financial and property markets. The Group incurred an unrealized fair value loss on its investment portfolio of €0.8 million compared to a fair value gain of €0.6 million during 2010. GlobalCapital also reported an impairment charge on its property portfolio of €0.7 million mainly related to a property in Italy.
On the other hand, the life insurance business registered substantial growth in new regular premium over the business written in 2010. Despite the heavy competition in this sector, GlobalCapital’s health insurance income grew by 8% when compared to the same period last year. The insurance business registered a loss before tax of €1.145 million (2010: loss of €0.22 million) reflecting the underperforming investment markets. The investment service division incurred a loss of €0.45 million (2010: loss of €0.55 million) while the agency brokerage business generated a pre-tax profit of €0.32 million (2010: €0.30 million).
In the Annual Report, the Board of Directors stated that they have initiated the process of disposing of a number of the Group’s local and overseas properties and a number of ‘promise of sale agreements’ have already been entered into. The Board also mentioned that the forecasted cash flows, which take in account the proceeds from the property sales, indicate that the Group will have sufficient funds to meet its obligations in the near term. Furthermore, the Board indicated that if the Group performance is below that forecasted, the funds required to meet its commitments will be generated by raising additional finance including the potential for an increase in capital .
The 2011 Annual Report also refers to the 5.6% bonds maturing between 2014 and 2016. In the report it is mentioned that GlobalCapital plc will consider the possibility of a roll over, issuing new bonds or liquidating some of the assets in order to finance the redemption of this bond.
Going forward, GlobalCapital indicated that its priority remains that of managing its expenses, growing revenues and creating value for shareholders.
The Annual General Meeting is scheduled to take place on 14 June.