QBE share price leaps 10% amid explosive dividend growth

QBE boosted its final dividend payout by a whopping 58% from the prior year.

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Key points

  • The QBE share price is up 10% on Friday morning
  • The ASX 200 insurer reported its full-year 2022 results
  • Profits and the final dividend payout were well up from 2021

The QBE Insurance Group Ltd (ASX: QBE) share price is off to the races today. 

Shares in the S&P/ASX 200 Index (ASX: XJO) insurance company closed yesterday trading for $13.40. Shares are currently changing hands for $14.69, up 9.6%.

This comes following the release of QBE's full-year 2022 results (FY22).

Here's what's piquing ASX 200 investor interest on Friday morning.

QBE share price soars amid dividend growth

  • Statutory net profit after tax (NPAT) of $770 million, up from $750 million in FY21
  • Adjusted cash profit after tax increased 5.2% year on year to $847 million
  • Adjusted cash return on equity of 10.5%, up from 10.3% the prior year
  • Adjusted gross written premium of $20.1 billion, up 13% from FY21
  • Declared a final, fully franked dividend of 30 cents per share, up 57% from the 19 cents per share paid out in FY21

What else happened during the year?

ASX 200 investors may also be bidding up the QBE share price today on the insurer's continuing premium growth.

The company reported 13% gross written premium growth, driven by a 7.9% increase in its group-wide renewal rate.

In other action during the year, QBE entered into a broad-based reinsurance transaction with Enstar Group Limited (NASDAQ: ESGR). The company said this de-risks its exposure to reserves totalling around $1.9 billion. That transaction remains subject to regulatory approvals.

And the QBE share price doesn't seem to be negatively impacted today by the rather poor performance of the company's investment portfolio.

QBE reported a total investment loss in 2022 of $776 million, or a loss of 2.7%. In 2021 the investment portfolio returned a gain of 0.4% for a return of $122 million. QBE said unrealised losses associated with significant increases in bond yields over the year were responsible for much of those negative returns.

What did management say?

Commenting on the results sending the QBE share price rocketing today, CEO Andrew Horton said:

Our new purpose, vision and strategic priorities launched at the start of 2022 have been embraced by our people, helping to bring us together and become a more consistent organisation.

As we look forward, we have the right foundations in place, the right team and importantly, strong enterprise-wide engagement around a clear and consistent strategy…

2022 has been about laying the foundations and embedding our new vision, purpose and strategic priorities.

What's next?

Looking ahead at what might impact the QBE share price down the road, the insurer expects 2023 constant currency gross written premium growth to be in the mid-to-high single digits.

QBE also flagged a significant expected improvement in its investment returns.

QBE share price snapshot

As you can see in the chart below, with today's big intraday spike factored in, the QBE share price is up 16% over the past 12 months.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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