Liva Group SAOG (LIVA) Earnings Call Transcript & Summary

[Foreign Language] and welcome, everyone. This is the H1 2026 MSX session for Liva Group SAOG. It is the 10th of September 2026, and it's 2:00 p.m. Oman time. Welcome all. I'd like to begin today's presentation by reading the disclaimer on the screen. The material in this presentation has been prepared by Liva Group SAOG, also known as Liva, and is general background information about Liva's activities current as of the date of this presentation. This information is given in summary form and does not purport to be complete. Information in this presentation, including forecast financial information, if any, should not be considered as advice or a recommendation to investors or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information having regard to these matters, any relevant offer documents and, in particular, you should seek independent financial advice. This presentation may contain forward-looking statements, including statements regarding our intent, belief or current expectations with respect to Liva's businesses and operations, market conditions, results of operation, financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward-looking statements. Liva does not undertake any obligation to publicly release the results of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside Liva's control. Past performance is not a reliable indication of future performance. For today's presentation, I'd like to now run through the agenda for today. We will commence with our Group CEO's opening statements, which will be followed by our group financial performance, strategic highlights, and then our Group CEO will give some closing statements. After that, we will allow time for a Q&A. [Operator Instructions] Following our presentation, we will then open the floor for questions. [Operator Instructions] Should you have any questions, I request that you please use the chat function on the MS Teams app and type out your questions. Following the presentation, we will then read out these questions in order, and the relevant Liva management team will respond to your questions. I hope this is clear. I'd now like to hand over to our Group CEO to begin the presentation. Thank you very much.

Thank you very much, Sara, and good afternoon, and welcome to everybody. I am David Healy. I am the Chief Executive Officer of the Liva Group. And today, we'd like to share with you information on our first half performance, on our strategic priorities and also take a look ahead to the remainder of this year. As Sara mentioned, there will be time at the end for some questions. So Sara, if I may, I'd like to start with an update to our Board of Directors. So as you can see, this is our -- this is the makeup of our Board, and we are delighted and honored to have such esteemed and capable leadership on our Board of Directors. In particular, I would like to welcome our new Chairman, Sheikh Khalid Al Khalili, who has taken over the Chairmanship of the Board, and we welcome him to this role. At this time, I would also like to express my thanks and, of course, our deep appreciation to Khalid Al Zubair, our previous Chairman, for his outstanding leadership and vision throughout his tenure with Liva. These changes to the Board and ongoing addition of Board Directors is a reflection of our focus on strengthening our governance and shaping the future direction of the Liva Group. Looking at our management team, I'm delighted to be joined today by Dr. Dhafir Awadh Al Shanfari, who's our Group Chief Operating Officer; and also by Michael Thomssen, who is our Group Chief Finance & Investment Officer. I'm pleased to say Michael has joined us recently as the position of CFO, and this will be his first opportunity to share the results. Michael brings with him some outstanding international experience, having worked for many years in some of the world's largest insurance companies. I'm also very pleased to be joined on the line by our 3 regional CEOs: Hanaa, Addal and Mohamed, and in particularly, I'd like to welcome Addal and Mohamed, who have in this period been formally notified and appointed as CEOs of the regional businesses in the UAE and in KSA. Looking forward, as we enter the second half of this year, we are very well placed to build on the solid momentum from the first half of the year. We are firmly committed to delivering sustainable growth, and we believe in long-term value creation with a focus on earnings quality. In this regard, our underwriting discipline across our portfolios remains key with a view to delivering sustained profitability and reduced earnings volatility. We also remain extremely diligent on a prudent capital management approach. We are proud of our leading geographic position across the Gulf and the range and product diversity we deliver to the markets and to our customers. Strategically, we are focusing on ongoing operational and cost efficiency, including the adoption of AI. We are expanding and deepening our regional presence and, in particular, expanding our distribution partnerships and with the international broker community. And finally, and importantly, we continue to believe in customer centricity in everything we do and the ongoing placement of our customer at the center of our strategy and ongoing innovation and development of our risk solutions. So with that, I'd like to hand over to Michael, who will talk us through the first half financial results. Michael?

Thank you, David. Turning to our financial performance. The first half of '26 reflects continued growth across the group while maintaining a focus on underwriting discipline and sustained profitability. Insurance revenue increased by 17% to OMR 227 million compared with OMR 194 million in the first half of last year. We saw growth across our markets and lines of business, primarily driven by strong momentum in the KSA, supported by continued expansion in motor, alongside growth in Oman and the UAE. Our insurance services result is OMR 8.3 million for the first half year compared with OMR 10.3 million in the prior year. Disciplined underwriting continued to support a healthy underwriting result, while the year-on-year movement also reflects adverse weather events in the first quarter and a particularly strong prior year comparative. Underlying margins remain healthy, supported by disciplined pricing and risk selection across our core markets. Investment income increased to OMR 8.5 million from OMR 7.5 million last year. This represents a 14% increase year-on-year, supported by a 22% increase in our invested asset base, reflecting business growth and improved cash flows from receivables and operations. The portfolio remains conservatively positioned, and the return achieved reflects global market rates standing at 5% for the first half of '26. The group delivered profit after tax of OMR 4.5 million in the first half. The year-on-year movement reflects the drivers of insurance service results, which I just mentioned, together with continued investments in the group's transformation and strategic initiatives as we continue to build capabilities to support the group's longer-term growth. In summary, the underlying picture remains one of strong top line growth, disciplined underwriting and resilient investment income. If we could move to the next page, please. Looking at the composition of growth, we continue to see a gradual evolution towards a more balanced portfolio across our lines of business. The chart compares our business mix in the first half of '25 with that of '26. Health remains the largest line of business, but its share of the overall portfolio has reduced from 53% to 49%, reflecting less reliance on this line of business. At the same time, motor has increased from 28% to 34%, largely reflecting the strong growth we have seen in the KSA. Non-motor lines represent 12% of the portfolio compared with 14% in the prior period, while life remains broadly stable at around 5%. As these numbers show, we are continuing to develop Liva as a diversified composite insurer, reducing concentration and creating a more balanced distribution across markets and products. We remain disciplined in how we pursue that growth. Our focus is to allocate capital towards areas where we see attractive returns and sustainable profitability. With that, I'll hand over to Dr. Dhafir, our Group Chief Operating Officer, to take us through our strategic priorities and some of the key operational developments across the group. Dr. Dhafir, please?

Thank you, Michael. Happy to come back to this session. I'll briefly cover our 5 strategic pillars and market highlights. So we, at the group, focus on 5 key areas. And under each of them, there are obviously many initiatives that are either run at the group level or at the country level, and we have been investing in capabilities and resources to ensure we have the right transformation resources to see through many of these initiatives, and we will continue to do so. So the first one is the financial strength and discipline, which basically looking at strengthening our capital management, cost control and therefore -- and thereby drive sustainable performance and shareholder value. The second one would be the sustainable profitable growth that we want to continue, and that can be inorganically through various partnerships and platforms that we have established, but also continue focusing on M&A opportunities that are assertive. With efficient use of capital and capabilities, we believe we are on the right track. The third is the customer and brand leadership pillar or area of focus, which has been one of the areas we've always looked at, but has been strengthened more and more over the past year when it comes to customer experience journey and our plans to initiate a number of initiatives to see through many positive changes under this function, innovation across our insurance products and services and positioning of the Liva brand. The fourth, people and performance excellence. Obviously, our people are at the heart of building a high-performing organization. We continue to invest in both locally available new talent and the development of our existing workforce. Strengthening leadership capabilities at every level will continue -- will enable us to drive consistent execution of our strategic priorities. And the last is obviously governance, risk and control. These are key areas to protect the group and support confident decision-making. So these reflect the continued disciplined approach to how we are executing across the group. If I move to the next slide. With the country leaders here, obviously, they are leading and seeing through many important initiatives, these are just a few tangible examples to share publicly today. So in Oman, we have enhanced our health claims operating model through automation, improving both the turnaround times and accuracy. This began as an opportunity to strengthen our operating model and evolved into a comprehensive business transformation program that boosted our automation capabilities and improved our turnaround times in health claims. In the UAE, our new medical app went live, giving members self-service access to their policy, provider network and claims. The focus is to bring about a single digital platform that improves accessibility, engagement and service delivery with our customers. We are continuing to add further capabilities into this app, mobile app, which would deliver a streamlined and unified customer experience across all the markets we operate in. In KSA, Liva KSA was recognized by TIME and Statista as one of the World's Growth Leaders 2026, which is one of only 24 Saudi companies included among 1,000 global growth leaders. This recognition reinforces and serves as a testament towards Liva KSA growth and disciplined execution and delivery of sustainable value to customers and shareholders. If I move to the next slide. This is a typical slide we use almost -- we've used over the past few sessions. And obviously, as you look at this, our continued commitment to our core markets that's continuous growth is mentioned, as presented by Michael, on the financial section. If you look at Oman, the business is driven by disciplined financial performance, supported by tangible transformation outcomes across medical claims, finance and digital distribution. The UAE has shown resilient performance despite a challenging environment with continued focus on strengthening talent, improving efficiency and driving innovation. In KSA, as mentioned, consistent profitability driven by disciplined growth in underwriting results and investment income while continuing to strengthen strategic partnership, and we continue to explore inorganic growth opportunities in that market. For the smaller markets, we continue to be prudent in underwriting a strong cost discipline and have helped stabilize portfolio performance, continued focus on building sustainable technical profitability, supported by initiatives to strengthen our market presence will continue. This is all for me today or for now at least. Back to you, David. Thank you.

Thank you, Dr. Dhafir. Thank you, Michael. So thank you for your summaries of what I think we're confident has been a very robust and strong first half of the year. And as we say, we are excited with the momentum that we take forward into the second half of the year. You can see that we have a clear focus on financial discipline, on growing our business, on investing in our people, on putting our customers very much at the center of everything we do and always having a strong view on our risk and control culture. So again, thank you for your attention today. And with that, Sara will hand over to any questions that may come forward.