Adamjee Insurance reports 25% YoY decline in first-quarter profit
By MG News | May 28, 2020 at 11:46 AM GMT+05:00
May 28, 2020 (MLN): Adamjee Insurance Company Limited (AICL) has unveiled its financial results for the 1st quarter ended March 31, 2020, as per which the company has posted its profit after tax of Rs 493 million (EPS: Rs 1.40) i.e. 25% lower than the net profits of Rs 661 million (EPS: Rs 1.84) of the corresponding period last year.
The company reported underwriting income of Rs 3.10 billion owing to the growth of 15% YoY in net premiums, a marginal increase of 1.29% YoY in Insurance Claims, and Acquisition Expenses while 11% YoY decrease in Management Expenses.
As per the financial statement issued by the company, the decline in profitability of the company was attributable to decreased investment income which went down by 14% YoY to Rs 1.20 billion and a net fair loss on financial assets of Rs 3.78 billion.
During the period, the rental income jumped by 6.5 times YoY to Rs 10 million owing to a recently acquired office building in Karachi and renovated office in Lahore that allow some floors to be available for rent, as per the research of Foundation Securities.
Meanwhile, the tax expenses of the company went down by 20% YoY to Rs 202 million.
| Consolidated Profit and Loss account for the Quarter ended March 31st, 2020 ('000 Rupees) | |||
|---|---|---|---|
|
| Mar-20 | Mar-19 | % Change |
| Net insurance premium | 7,216,399 | 6,253,018 | 15.41% |
| Net insurance claims | (3,872,600) | (4,035,566) | -4.04% |
| Net commission and other acquisition cost | (1,174,240) | (947,208) | 23.97% |
| Insurance claims and acquisition expenses | (5,046,840) | (4,982,774) | 1.29% |
| Management expenses | (951,975) | (1,069,499) | -10.99% |
| Net change in insurance liabilities | 1,886,273 | (997,129) | - |
| Underwriting result | 3,103,857 | (796,384) | - |
| Investment income | 1,202,518 | 1,402,980 | -14.29% |
| Net fair value loss on financial assets at fair value through profit or loss | (3,780,955) | 191,716 | - |
| Net realized gains on investment property | - | 21,000 | - |
| Rental income | 10,297 | 1,578 | 552.53% |
| Other income | 159,801 | 87,897 | 81.80% |
| Other expenses | (22,271) | (40,978) | -45.65% |
| Results of operating activities | 673,247 | 867,809 | -22.42% |
| Finance cost | (5,942) | (2,495) | 138.16% |
| Profit/(loss) from Window Takaful Operations | 35,776 | 26,434 | 35.34% |
| Profit before tax | 703,081 | 891,748 | -21.16% |
| Income tax expense | (209,710) | (230,231) | -8.91% |
| Profit after tax | 493,371 | 661,517 | -25.42% |
| Basic and diluted earnings per share - Rupees | 1.40 | 1.84 | -23.91% |
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