LifeStar Holding plc has recorded a pre-tax loss of €1.1 million for 2020, after registering a profit of €2.1 million in 2019.

The loss is mainly due to the impact of the COVID-19 pandemic on the Group’s financial investments, which recorded fair value losses of €2.2 million during the year, mainly due to the negative performance of the local and international investment markets, particularly movements in the fair value of local equities.

During 2019, the Group’s financial investments generated gains of €2.1 million following a general uplift in the markets, particularly local equities, as well as local and sovereign bonds.

This loss was partly offset by a revaluation of the Group’s property holdings, which registered a fair value gain of €2.1 million, as compared to a €0.5 million gain in 2019.

The figures emerge from the LifeStar Holding’s financial statements, posted to the Malta Stock Exchange.

LifeStar Holding, through its subsidiaries (collectively ‘the Group’), is involved in several insurance markets and property management, consultancy and development.

The Group’s assets increased by 8.2 per cent to €166.3 million as at 31st December 2020, with its net asset value standing at €18.4 million, down from €19.1 million in 2019.

As in 2019, Lifestar Holding’s directors did not recommend the declaration of a dividend.

During the year, the Group continued to undertake restructuring and transformation activity to permanently resolve various legacy issues, with th directors expressing confidence that the plan is realistic given that it is in the final stages of implementation.

The Group therefore continues to explore possible ways to strengthen its capital base.

In this respect, over the past few months management has had continuous interaction with the Malta Financial Services Authority to ensure that the proposals would obtain the necessary regulatory approvals.

LifeStar Insurance Limited has thus submitted a formal application to the Listing Authority for the admissibility to listing of its existing shares on the Official List of the Malta Stock Exchange.

Concurrently, LSI submitted an application to the Listing Authority of the Malta Financial Services Authority for the issue of a subordinated bond of €10 million, subject to an over-allotment option of €3 million.

The proceeds from the sale of the shares in LSI to be used by the company to redeem the €10,000,000 5.00 per cent unsecured bonds maturing 2nd June 202,1 and to repay, in full or in part, a loan from Bank of Valletta.

The Directors are of the opinion that the Group will continue to improve and strengthen their financial performance and financial position, thus continuing to operate on a going concern basis.

As part of the restructuring, on 1st January 2021, Global Capital Holdings Limited merged with LifeStar Holding plc.

In relation to this, the Group embarked on an extensive re-branding exercise, changing its brand from GlobalCapital to LifeStar, with the new look and feel portraying a more modern and energetic image.

The Group worked “relentlessly” to differentiate its products from the market, with the enhancements made facilitating improved competitiveness and marketability.

The Group has three main susidiaries, LifeStar Insurance Limited, LifeStar Health Limited, and GlobalCapital Financial Management Limited, addressed in turn below.

LifeStar Insurance Limited (previously GlobalCapital Insurance Limited)

Group subsidiary LifeStar Insurance Limited registered an increase in gross written premium for the year, amounting to €13.19 million as compared to €12.03 million at the end of the comparative period.

The company has also intensified its efforts to recapture an amount of maturing business, which it completed successfully.

The company's profit after tax amounted to €0.3 million (2019: €1.5 million) and generated a total comprehensive profit for the year of €0.6 million (2019: €2.3 million).

The profit is mainly attributable to tax refunds and favourable movement in the value-in-force business, given that the company incurred a loss before tax of €0.4 million (2019: profit €2.0 million).

These losses are mainly due to the negative performance of financial investments, as well as changes in other technical provisions, net of reinsurance both of which were a result of the pandemic.

The net assets of the company have remained on the same lines as that of prior year, in the region of €29 million.

Total assets increased by 8.2 per cent (2019: 11.6 per cent) from €153.7 million to €166.3 million as at the end of the current reporting period.

Technical provisions increased by 10.6 per cent (2019: 13 per cent) from €112.5 million to €124.4 million.

LifeStar Insurance Limited’s Solvency II ratio was a healthy one and, as at 31 December 2020 amounting to 158 per cent.

LifeStar Health Limited (previously GlobalCapital Health Insurance Agency Limited)

LifeStar Health Limited registered a profit before tax of €1 million compared to a prior period profit of €0.3 million. The increase was mainly driven by higher revenues generated during the year in conjunction with lower administration costs.

Net assets increased from €1.5 million to €2.1 million. As in 2019, no dividends have been distributed due to the dividend distribution restriction imposed by the MFSA.

GlobalCapital Financial Management Limited

GlobalCapital Financial Management Limited (GCFM) sustained a loss before tax of €0.5 million compared to €1.2 million in the prior year.

The improvement in results between 2019 and 2020 is principally due to a decrease in administrative expenses of €0.4 million, following a change in recharges between Group companies, as well as an increase in other income of €0.3 million which pertains to an administrative fee for services rendered to LifeStar Insurance.

GCFM closed the current year in a net asset position of €0.4 million (2019: net liability position of €0.6 million).

During the year, the shareholder contributed €1.2 million by means of a shareholder’s loan and shareholder’s contribution. The shareholder’s loan is unsecured, interest free, repayable at the discretion of the company and has no fixed repayment date. This capitalisation contributed to the maintenance of own funds balance at the required level.