EFUG’s net profits up by 28% YoY owing to increased underwriting income

MG News | April 27, 2020 at 11:32 AM GMT+05:00

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April 27, 2020 (MLN): EFU General Insurance (EFUG) has unveiled its financial results for the 1^st quarter ended March 31, 2020, as per which the company has posted its profit after tax of Rs 744 million (EPS: Rs 2.31) i.e. 28% higher than the net profits of Rs 581 million (EPS: Rs 2.30) of the corresponding period last year.

Alongside financial results, the Board of Directors of the company announced a first interim cash dividend for the 1QCY20 at Rs 1.5 per share i.e. 15%.

As per the financial statement issued by the company, the core business of the company grew as underwriting income witnessed a substantial increase of 57% YoY.

The net premiums growth remained flat owing to economic implications amid COVID-19 while EFUG reported a 4.77% YoY increase in Insurance Claims and Acquisition Expenses and a 9.6% YoY increase in Management Expenses.

During the period, the profitability of the company was also attributable to increased investment income which went up by 24% YoY on the back of gains on investment in Fixed income instruments.

Meanwhile, the tax expenses of the company went up by 2.5 times YoY during the period.

Profit and Loss Account for the 1st Quarter ended March 31st, 2020 (Rupees in '000)
	Mar-20	Mar-19	% Change
Net insurance premium	9175749	9069522	1.17%
Net insurance claims	-5420361	-5041008	7.53%
Net commission and other acquisition costs	-1760116	-1812577	-2.89%
Insurance claims and acquisition expenses	-7180477	-6853585	4.77%
Management expenses	-1168715	-1066120	9.62%
Net change in insurance liabilities (other than outstanding claims)	-2265240	-2064910	9.70%
Underwriting result	-1438683	-915093	57.22%
Investment income	3017055	2433709	23.97%
Net realized fair value losses on financial assets	96938	-2689962	-
Net fair value gain / (loss) on financial assets at fair value through profit and loss	-492264	1858465	-
Rental income	32266	29443	9.59%
Other income	67757	64261	5.44%
Other expenses	-44200	-28150	57.02%
	2677552	1667766	60.55%
Results of operating activities	1238869	752673	64.60%
Profit from window takaful operations - Operator's Fund	58827	53145	10.69%
Profit before tax	1297696	805818	61.04%
Income tax expense	-552999	-224227	146.62%
Profit after tax	744697	581591	28.04%
Profit attributable to:
Equity holders of the parent	463702	460905	0.61%
Non-controlling interest	281995	120686	133.66%
	745697	581591	28.22%
Earnings (after tax) per share - Rupees	2.31	2.30	0.43%

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