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HomeEquityEFUG's yearly profits drop slightly by 6% YoY

EFUG’s yearly profits drop slightly by 6% YoY

February 10, 2020 (MLN): EFU General Insurance Limited (EFUG) has announced its financial results for the year ended December 31, 2019, as per which the insurance company observed a slight decline in its net profits by 6% YoY to Rs 3.3 billion with earnings per share clocked in at Rs 12.74 per share.

Compared to the previous year, the company earned Rs 3.5 billion as net profits with earnings per share reported at Rs 14 per share.

As per the financial statement issued by the company, the Net Insurance Premium Revenue was Rs. 38.5 billion as against Rs. 30.8 billion in the last year.  The Net Insurance Claims rose by 6% YoY to Rs 19.19 billion against Rs 12.3 billion. The overall Claims ratio to Net Premium Revenue was 50% as compared to 40% reported in 2018.

The company’s underwriting results turned negative in 2019 due to cost increase be it net claims, commissions or management expenses.

However, investment income (including rental, profit on deposits and other income) that usually is the rescuer for the bottom-line of an insurance company increased remarkably by 108% to Rs 13 billion against Rs 6.3 billion recorded last year.

Furthermore, in a higher interest rate environment which helped the company and the sector to raise more investment income, the company strived hard to provide a better return to its shareholders. Alongside financial results, the Board of Directors of the company announced a final cash dividend at Rs 5.5 per share i.e. 55%. This is in addition to the aggregate amount of First, Second and Third Interim Dividends of Rs 4.5 per share (i.e. 45%) declared and paid during the year.  

Profit and Loss Account for the year ended December 31st 2019 (Rupees in '000)

 

Dec-19

Dec-18

% Change

Net insurance premium

38542194

30869493

24.86%

Net insurance claims

-19198970

-12300512

56.08%

Net commission and other acquisition costs

-7879291

-5949908

32.43%

Insurance claims and acquisition expenses

-27078261

-18250420

48.37%

Management expenses

-4693780

-3986983

17.73%

Net change in insurance liabilities (other than outstanding claims)

-11046950

-1276786

765.22%

Underwriting result

-4276797

7355304

 

Investment income

13166635

6322348

108.26%

Net realized fair value losses on financial assets

-7807925

-3518411

 

 Net fair value gain / (loss) on financial assets at fair value through profit and loss

3026353

-5924034

-151.09%

Rental income

112349

103991

8.04%

Other income

309526

215637

43.54%

Change in fair value of investment property

433899

10681

3962.34%

Other expenses

-77395

-67654

14.40%

 

9163442

-2857442

-420.69%

Results of operating activities

4886645

4497862

 

Finance cost

-14090

 

 

Share of profit of associate

 

103952

 

Reversal of workers' welfare fund

273057

 

 

Profit from window takaful operations – Operator's Fund

214143

117452

82.32%

Profit before tax

5359755

4719266

13.57%

Income tax expense

-1990357

-1138414

74.84%

Profit after tax

3369398

3580852

-5.91%

Profit attributable to:

 

 

 

Equity holders of the parent

2547472

2799199

-8.99%

Non-controlling interest

821926

781653

5.15%

 

3369398

3580852

-5.91%

Earnings (after tax) per share – Rupees

12.74

14.00

-9.00%

 

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Posted on: 2020-02-10T11:56:00+05:00

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