MAPFRE held the second virtual meeting with more than 200 private shareholders to provide them with the latest details of last year’s results and to give them a chance to ask any questions concerning the business in general and the share performance in particular. This was the second online presentation due to the circumstances of the pandemic. However, MAPFRE has in fact been carrying out this exercise in transparency since 2017, holding over ten meetings since then, in both MADRID and Barcelona.
Fernando Mata, MAPFRE CFO and a member of the Board, began his presentation with the main business metrics and highlighted their strength despite the turbulent times of last year. In 2020, MAPFRE generated an operating result of 658 million euros. This figure was significantly affected by the impact of COVID in the first half of the year, while in the second half, the company generated a very strong result of 388 million euros.
MAPFRE’s commitment to its shareholders was demonstrated again by maintaining a total dividend from the result for the period of 12.5 gross euro cents per share, which is a 73.1 percent payout, despite this complicated environment. In total, it will pay shareholders 385 million euros, bringing the return on the 2020 average share price to eight percent. In addition to this financial dividend, Mata also emphasized the Group’s social dividend.
Despite these numbers, the executive expressed his dissatisfaction with the share performance: “The market still thinks that there are uncertainties that could harm us in the future, but we will continue working so that the market puts us at the levels we deserve. I wonder every day what is happening to our shares and I struggle to get a logical answer. We told the market everything, resolved the uncertainties, presented steady results and did not abandon the path of distributing dividends. So there is no clear explanation regarding our position on the Stock Exchange,” he said.
The analysists with whom the group met express two uncertainties that may be impacting the value. First, external factors, such as doubts about how stimulus packages from central banks and governments implemented for economic reconstruction will work, mainly in Latin America, an especially important region to the business. The second, Mata recalled, refers to Bankia, and specifically when the exit is going to take effect and what compensation we will be given. “The market is king, but it is not recognizing all of MAPFRE’s strengths and capabilities,” he said. “A dividend yield above eight percent makes no sense. This is an error. We have 8.5 billion as shareholders and the shares are worth less than 5 billion. It doesn’t make sense,” he said.
In addition to share performance, the shareholders asked questions about the impact on the business from currency fluctuations; exposure to public debt, particularly in Spain; management of the treasury stock and maintaining the payout.
Shareholders will have more information at the next Annual General Meeting on March 12.