Mapfre Middlesea plc - Full Year Results

Total gross premiums written by the Middlesea Group during the twelve months ended 31 December 2003 increased by 11.1% (Lm3.5 million) to Lm35.2 million.

The Italian subsidiary Progress Assicurazioni SpA accounted for 62% of total premiums written. Total income from insurance activities increased by 14.3% to Lm1.5 million. Whilst the balance on the general business technical accounts registered a sharp drop of 34.8% to Lm662,000 mainly attributable to the storm events in September 2003, the balance on the long-term business technical account doubled to Lm207,000 and the Group’s share of profits from
Middlesea Valletta Life Assurance Co. Ltd. increased almost threefold from Lm250,843 in 2002 to Lm680,077. Net investment income dropped 13.7% due to the fact that in 2002 certain capital gains were registered on the sale of investment properties and other financial investments which were not repeated this year. Administrative expenses remained largely unchanged at Lm1.1 million.

Group profit on ordinary activities before tax amounted to Lm1.4 million, representing a 9.5% increase over last year. However after accounting for taxation and minority interests, profit for the year dropped by 6.5% to Lm1.1 million. This is due to a positive tax figure in 2002 to the tune of
Lm521,000 as a result of certain deferred tax benefits compared to a low tax deferral during 2003 of Lm27,000.

The Directors have recommended the payment of a net dividend of Lm625,000 (equivalent to 5c per share), an increase of 9.9% over the Lm568,750 or 4c55 per share paid last year. Prior to the deduction of 35% tax, the dividend
works out at 7c69, translating into a gross dividend yield of 3.2%. This dividend will be paid to all shareholders on the register as at 18 May 2004. Consequently, the shares begin trading XD as from Wednesday 19 May.

The Group's total assets increased by 15.9% (Lm12.9 million) throughout the year to stand at Lm93.7 million as at 31 December 2003. Shareholders funds as at the end of 2003 amounted to Lm21.9 million, translating into a book value per share of 175c.

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