‏“‏Arabia Insurance” achieved SR11.56 mln net profit during Q1‎

Arabia Cooperative Insurance Company recorded a net profit before zakat during the first quarter of 11.56 million riyals, compared to a loss of 9.3 million riyals in the same quarter of last year. This came after today’s announcement of the preliminary financial results for the period ending on 03-31-2023. (3 months).

The total shareholders’ equity “without minority rights” in the current period amounted to 500.5 million riyals, compared to 226 million riyals in the same period last year, an increase of 122%.

Earnings per share in the current period reached 0.15 riyals, compared to a loss of 0.39 riyals in the same period last year.

The company applied International Financial Reporting Standard No. 17 (Insurance Contracts) and International Financial Reporting Standard No. 9 (Financial Instruments), in accordance with the standards approved in the Kingdom of Saudi Arabia, as of January 1, 2023 and retroactively, which led to a radical change in the presentation of results financial periods for all periods starting from the first quarter of 2023 and re-measurement of previous similar periods in accordance with the new standards. As a result, the company announced the financial results according to the data available under International Financial Reporting Standard No. 17 and International Financial Reporting Standard No. 9, and the data that was not available due to its inconsistency with the new standards was indicated with “0”.

The reason for achieving the net profit in the current quarter compared to the net loss in the similar quarter of the previous year is due to the increase in the result of insurance services, which resulted from an increase in insurance revenues by approximately 97 million Saudi riyals, in addition to an increase in net investment return by approximately 5 million riyals Saudi. This is despite the increase in the expenses of insurance services by approximately 64 million Saudi riyals, as well as the increase in the net expenses of reinsurance contracts by approximately 11 million Saudi riyals.

While the company applied International Financial Reporting Standard No. 17 (Insurance Contracts) and International Financial Reporting Standard No. 9 (Financial Instruments), according to the standards approved in the Kingdom of Saudi Arabia, as of January 1, 2023 and retroactively, which led to a radical change in the presentation of Financial results for all periods starting from the first quarter of 2023 and re-measurement of previous similar periods in accordance with the new standards. As a result, the company announced the financial results according to the data available under International Financial Reporting Standard No. 17 and International Financial Reporting Standard No. 9, and the data that was not available due to its inconsistency with the new standards was indicated with “0”.

The financial results for the previous quarter were announced in accordance with the previous standards, International Financial Reporting Standard No. 4 and International Accounting Standard No. 39, and the company did not disclose the balances for the relevant period in accordance with the transition requirements for the new standards in the financial statements for the current quarter. Therefore, the changes between the current quarter and the previous quarter were not explained due to the inconsistency of the financial standards between the two periods

The company has also reclassified and measured the financial statements for the comparative figures for the previous year to comply with the requirements of International Financial Reporting Standard No. 17 and International Financial Reporting Standard No. 9.

The company added that the profit / loss per share was calculated based on dividing the net result of the period after zakat and income tax on the weighted average number of shares outstanding during the period, taking into account the impact of the capital increase on the current period. The net profit after zakat and income tax during the quarter was The current amount is 7,322 thousand Saudi riyals, compared to a net loss after zakat and income tax of 10,284 thousand Saudi riyals for the same quarter of the previous year after adjustment according to the two criteria referred to above.