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Introduction & Market Context
Icelandic insurance company Sjóvá presented its second quarter and first half 2025 financial results on July 17, 2025, revealing a mixed performance characterized by strong insurance operations offset by investment losses. The company reported a Q2 2025 profit of 60 million ISK after tax, with its stock trading at 46.8 ISK as of July 16, 2025, well above its 52-week low of 36.4 ISK but below its high of 55.5 ISK.
Quarterly Performance Highlights
Sjóvá’s Q2 2025 results demonstrated significant improvement in its core insurance business, with a combined ratio of 92.1%, substantially better than the 101.8% recorded in Q2 2024. This improvement came despite challenges from four major fire claims during the quarter.
As shown in the following chart of key performance indicators:
The company’s insurance operations generated a profit of 690 million ISK before tax, while investment activities resulted in a loss of 439 million ISK before tax. Insurance contract income reached 8,694 million ISK, representing a 4.2% year-over-year increase, while losses during the period decreased by 6.9% to 5,852 million ISK.
The following waterfall chart illustrates how these factors contributed to the final profit figure:
Detailed Financial Analysis
Insurance Operations
Sjóvá’s insurance segment showed strong performance across multiple metrics. The company’s combined ratio improvement indicates enhanced operational efficiency and better risk management. The breakdown by insurance segment reveals varied performance across the company’s portfolio:
For the first six months of 2025, insurance contract income totaled 17,067 million ISK, a 3.9% increase compared to the same period in 2024. Meanwhile, losses during the period decreased by 5.7% to 11,582 million ISK, resulting in an income from insurance contracts of 1,511 million ISK.
The company’s six-month income statement breakdown is illustrated in this chart:
Investment Performance
In stark contrast to the insurance operations, Sjóvá’s investment portfolio struggled during Q2 2025, delivering a negative return of 0.1%. The investment assets under management generated a loss of 56 million ISK, with listed and unlisted equities being the primary detractors, posting a combined loss of 779 million ISK.
The following breakdown shows the investment performance across different asset classes:
For the first six months of 2025, the investment return was -1.1%, contributing significantly to the company’s overall six-month loss of 479 million ISK after tax. The investment portfolio decreased by approximately 3,800 million ISK during this period, largely due to a 3,400 million ISK dividend payment to shareholders in the first quarter.
The historical income composition shows how the balance between insurance operations and investment performance has evolved over time:
Forward-Looking Statements
Despite the challenges in its investment portfolio, Sjóvá maintains a positive outlook for 2025, projecting a full-year return of 1,700-2,400 million ISK. The company highlighted its strong financial position with total assets of 73,908 million ISK and total equity of 21,278 million ISK as of June 30, 2025.
Sjóvá also emphasized its commitment to sustainability and innovation, including the introduction of a new pregnancy insurance product, as illustrated in this summary slide:
The company’s diversified business model and strong insurance operations provide a solid foundation for future growth, though investment performance will remain a key factor to monitor in the coming quarters. Sjóvá’s ability to maintain its improved combined ratio while navigating volatile investment markets will be crucial to achieving its projected full-year results.
Full presentation:
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