December 01, (THEWILL) — Guinea Insurance Plc recorded a massive post-tax profit decline of 93.2 percent in the nine months of the year. According to its interim Q3 2025 report filed with the Nigerian Exchange (NGX), the profit after tax plunged to N37.65 billion in the nine months of 2025, from N555.32 billion garnered in the equivalent period of 2024.
The company also recorded a marginal revenue growth of 4.9 percent for the nine months of 2025, from N2.03 billion to N2.13 billion, while profit before tax slid to N49,09 billion from N567.66 billion constituting a 91.3 percent decline.
This signals the insurer’s possible return to the era of profit and dividend draught during which the firm trudged on the path of diminishing returns. While the key financial ratios show that the fundamentals are still strong, the shareholders are not unlikely to see another year of no dividend in 2025.
Guinea Insurance Plc posted a loss after tax of N114.7 million in the first half of 2025, compared to a profit of N115.94 million in the same period of 2024 and N936.55 million for the full year 2024.
By this, the 67-year-old insurer launched back into the profit and dividend draught regime it had exited about two years earlier was a concern to the shareholders.
Before the landmark exit from profit drought in 2023, Guinea Insurance had recorded a cumulative five-year post-tax loss of N1.3 billion as of 2022 – a figure above its N1.2 billion market capitalisation at the time. The firm posted the last profit of N251 million in 2017, after which it launched into the ‘Loss Expressway’ that lasted five consecutive years to 2022.
The exit from the profit and dividend drought period saw Guinea Insurance bounce into profit, recording profit after tax (PAT) of N477.77 million in 2023, constituting a 673.7 percent gain compared to the loss of N83.27 million in the previous year. The growth trajectory culminated in N936.55 million PAT in FY 2024.
The positive trend came on the heels of the regulatory approval by the National Insurance Commission (NAICOM), the Securities and Exchange Commission (SEC), and the Nigerian Exchange Group (NGX) for Guinea Insurance to proceed with its proposed issuance of 1.8 billion ordinary shares to shore up its capital base.
According to the firm at the time, the initiative involved the issuance of 1,802,800,000 Ordinary Shares at 50 Kobo per Share which it said represented a reinforcement of its dedication to regulatory compliance and its “clear strategic vision to emerge as one of the key players in Nigeria’s insurance industry”.
Growth bolstering strategy
To strengthen the company on the path of growth the Board of Directors of Guinea Insurance is seeking shareholders’ approval to raise up to N15 billion in additional capital for the company.
This was disclosed in the notice of the Extraordinary General Meeting filed with the Nigerian Exchange Limited on Wednesday, November 26, 2025
The capital-raising efforts come on the heels of the passage of the Nigerian Insurance Industry Reform Act 2025, which stipulates higher Minimum Capital Requirements for players in the insurance sector.
According to NIIRA 2025, the minimum capital base for non-life insurers has been raised to N15 billion, while the capital requirement for life insurance firms is now at least N10 billion. Reinsurance companies received the steepest increase, with their capital threshold now pegged at N35 billion.
The first special business of the Guinea Insurance EGM scheduled for December includes:
1.That the company’s minimum issued share capital be and is hereby increased from N4,000,000,000 (four billion naira), made up of 8,000,000,000 (eight billion) ordinary shares of N0.50 kobo each, to N19,000,000,000 (nineteen billion naira), made up of 38,000,000,000 (thirty-eight billion) ordinary shares of 50 kobo each.
That in order to comply with statutory capital requirements, strengthen the company’s financial base and support its strategic growth objectives, the Board of Directors be and are hereby authorised to raise additional equity capital of up to N15,000,000,000 (fifteen billion naira) by way of Rights Issue and Private Placement, on such terms, pricing, allotment structure and timetable as the Board of Directors may determine in the best interest of the company.
Pursuant to Resolution 1b above, the Directors are authorised, subject to approval of the relevant regulatory authorities, to raise additional capital through the issuance of up to 6,327,779,310 (six billion, three hundred and twenty-seven million, seven hundred and seventy-nine thousand, three hundred and ten) ordinary shares on such terms as may be determined by the Board of Directors, subject to the approval of the relevant regulatory authorities.
The shares proposed to be issued pursuant to the above resolution and the rights attaching thereto shall rank at least pari passu with ordinary shares held by the existing members of the company.
In addition, the directors are seeking shareholders’ ratification to raise further capital through the issuance of up to 5,295,200,000 ordinary shares by way of Rights Issue, with unsubscribed shares to be allotted to other investors via private placement.
Nine months synopsis
Total assets stood at N6.91 billion, a notable increase from N6.08 billion in the prior year period (30 September 2024), though slightly down from N6.95 billion at year-end 2024.
Total liabilities significantly reduced to N1.66 billion from N2.03 billion in the corresponding period of 2024, primarily due to a decrease in insurance contract liabilities., compared to N4.05 billion as at 30 September 2024. This growth underscores an enhanced value base for shareholders.
Despite revenue growth, profitability faced significant headwinds during the period. A sharp rise in operating expenses and adverse movements in foreign exchange markets impacted the bottom line.
Insurance revenue increased by 5 percent to N2.14 billion for the nine-month period, up from N2.04 billion in 2024.
Insurance service result declined to N706.05 million from N847.52 million in the prior period, affected by higher net expenses on reinsurance contracts.
Profit after taxation experienced a sharp decline to N37.66 million, compared to a robust N555.33 million for the same period in 2024. This was largely driven by a significant increase in other operating expenses and a swing from a large unrealised foreign exchange gain in 2024 to a small loss in 2025.
Earnings Per Share (EPS): Consequently, EPS fell to 0.47 kobo from 6.99 kobo in the prior year period.
The company’s cash position saw a significant shift, moving from operational cash generation to a net outflow, while investment activities continued to contribute positively.
Net cash from operating activities recorded a net outflow of (N515.22 million), a stark reversal from the N33.47 million inflow generated in the same period in 2024. This indicates pressure on operational working capital.
Shareholder’s equity was bolstered despite lower profitability, reflecting movements in reserves. The total equity increased from N5.22 billion at the start of the year to N5.24 billion as at 30 September 2025.
Key movements included the profit for the period of N37.66 million, a transfer of N68.66 million to the contingency reserve, and a net fair value loss of N16.74 million on financial assets recognised in other comprehensive income.
A significant increase in ‘Other operating expenses’ to N1.25 billion (from N879.60 million in 2024) was a primary driver of reduced profitability. Furthermore, the company experienced an unrealised foreign exchange loss of N4.88 million on fixed deposits, contrasting sharply with a gain of N382.16 million in the prior period, illustrating the impact of currency volatility on investment returns.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
