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Insurance house 2013 net profit jumps 26.7 per cent

January 21, 2014

Abu Dhabi -based Insurance House earned net profit of AED 9.56 million for the financial year ended 31 December 2013 , which is 26.7 per cent higher than the net profit of AED 7.54 million earned during the Finance House subsidiary's maiden financial year ended 31 December 2012 , comprising of 20 months and 20 days. Total comprehensive profit for the 12 months ended 31 December 2013 was AED 14.38 million, which is more than double the total comprehensive profit of AED 6.79 million registered during the previous reporting period. Mohammed Alqubaisi , Chairman of Insurance House said, "We are delighted and encouraged with this remarkable performance by our young enterprise, operating in the fiercely competitive UAE insurance sector. It reaffirms our belief that product innovation and superior customer service are the key ingredients of profitable future growth. This is an evidence of the importance of investing in qualified human resources." Gross Premiums Written (GPW) during the 12 month period ended 31 December 2013 totalled AED 99.13 million, which is 26.5 per cent higher than the Gross Premiums Written during the previous reporting period ended 31 December 2012 . Net Earned Premiums aggregated to AED 66.21 million, up 54.2 per cent over the previous reporting period. Net Earned Premiums as a percentage of GPW improved to 66.8 per cent compared to 54.8 per cent in the previous period. Net Underwriting Profit for 2013, after deducting Operating expenses was AED 11.38 million, which is 34.3 per cent higher than the Net Underwriting Profit of AED 8.47 million registered during the previous reporting period. Net Underwriting Profit as a percentage of GPW improved to 11.5 per cent compared to 10.8 per cent in the previous reporting period. Underwriting Profit from core insurance activities was complemented by income generated from the proprietary investment portfolio. For the 12 months ended 31 December 2013 , income from investing activities amounted to AED 18.98 million compared to AED 13.59 million for the previous reporting period, on an annualised basis. "Since inception, IH's Investment Strategy continues to be well thought out, clearly documented and professionally managed," Alqubaisi stated. Total assets as of 31 December 2013 doubled to AED 254.61 million compared to AED 125.8 million as of 11 April 2011 , being the date on which we commenced operations. During the year, total shareholders' equity strengthened to AED 140.27 million as of 31 December 2013 , compared to AED 126.68 million as of 31 December 2012 . Cash and cash equivalents as at 31 December 2013 stood at AED 24.94 million compared to AED 17.21 million as at the end of the previous reporting period. General & Administrative expenses for the 12 months ended 31 December 2013 were AED 20.79 million compared to AED 24.38 million during the previous reporting period covering 20 months and 20 days. Ahmad Idris , CEO of Insurance House , said, "IH's operating cost model is designed to be efficient and rapidly scalable in line with business growth. This is reasonable for a full-fledged insurance operation covering our Abu Dhabi headquarters and four operational branches located in Dubai , Sharjah , Al Samha and Mussafah." "In this regard 12.5 per cent of the Company's current work force comprises of UAE nationals, manifesting our strong commitment to the development of UAE nationals in the insurance sector. This is ahead of the minimum requirement for employment of UAE nationals currently mandated by the UAE Insurance Authority for the year 2013," said Idris. Insurance House will not be making a dividend payment, bearing in mind the need to invest for accelerated growth in the near term. In 2013, the Company obtained necessary regulatory approvals to undertake a share buy-back program. The Company maintains that the share buyback initiative is in the best interests of its shareholders and is intended to enhance shareholders value. "Since inception, Insurance House has crossed several major milestones at a rapid pace. We have invested in the right people, processes and systems and have built a solid foundation for sustainable future growth. We look forward to 2014 with optimism and have accordingly set ambitious business growth targets. Our strategy is sound and is backed by a robust infrastructure that is geared to deliver profitable growth and maximized returns to our shareholders," said Idris.


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Source: CPI Financial


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