‎“Amana Insurance” profits increased to SR12.3 million during ‎Q2, by 70%‎

Amana Cooperative Insurance Company recorded a net profit before Zakat of 12.3 million riyals during the second quarter, compared to 7.2 million riyals in the same quarter of last year, an increase of 70%. This came after today’s announcement of the preliminary financial results for the period ending on June 30, 2023 (6 months).

The total written insurance premiums amounted to 30.8 million riyals during the second quarter, compared to a loss of 58.2 million riyals in the same quarter of the previous year, a decrease of 47.1%.

Net profit after zakat and tax during the 6-month period amounted to 22 million riyals, compared to losses of 21.3 million riyals in the same period last year.

Earnings per share in the current period amounted to 0.46 riyals, compared to a loss of 0.51 riyals in the same period last year.

“The company applied International Financial Reporting Standard 17 (Insurance Contracts) and International Financial Reporting Standard 9 (Financial Instruments), according to the standards approved in the Kingdom of Saudi Arabia, as of January 1, 2023 AD and retroactively, which led to a fundamental change in the presentation of Financial results for all periods starting from the first quarter of 2023 AD and re-measurement of similar periods from previous years according to the new standards. As a result, the company announced the financial results according to the data available under IFRS 17 and IFRS 9, and the data that is not in accordance with the new standards was indicated by the number “0”.

The following detailed explanation covers the announced financial statements and the updated financial statements attached to this announcement, which are consistent with the way financial results are presented in accordance with the new standards:

The reason for the increase in the net profit before zakat for the current quarter compared to the same quarter of the previous year by +5 million Saudi riyals, the change was proven by 69.9% of the following net effects:

1. An increase in net underwriting income by SAR 2.5 million, which was mainly determined by the following net effects: (Decrease in claims incurred by +33 million SAR, decrease in net revenue by -25 million SAR and increase in reserves by – 5.5 million Saudi riyals).
2. A decrease in other operating expenses, recognized from reversal of doubtful debts of SAR 2 million and an increase in investment income of SAR 0.5 million.

“The company applied International Financial Reporting Standard 17 (Insurance Contracts) and International Financial Reporting Standard 9 (Financial Instruments), according to the standards approved in the Kingdom of Saudi Arabia, as of January 1, 2023 AD and with retrospective effect, which led to a fundamental change in the presentation of Financial results for all periods starting from the first quarter of 2023 AD and re-measurement of similar periods from previous years according to the new standards. As a result, the company announced the financial results according to the data available under IFRS 17 and IFRS 9, and the data that is not in accordance with the new standards was indicated by the number “0”.

The following detailed explanation covers the announced financial statements and the updated financial statements attached to this announcement, which are consistent with the way financial results are presented in accordance with the new standards:

The increase in net profit before zakat for the current quarter compared to the previous quarter by SAR 2.6 million is due to the following main effects:

1. The cost of insurance services decreased by SAR 3.2 million
2. Increase the change in other technical reserves by 0.6 million Saudi riyals

“The company applied International Financial Reporting Standard 17 (Insurance Contracts) and International Financial Reporting Standard 9 (Financial Instruments), in accordance with the standards approved in the Kingdom of Saudi Arabia, as of January 1, 2023 AD and with retrospective effect, which led to a fundamental change in the presentation of Financial results for all periods starting from the first quarter of 2023 AD and re-measurement of similar periods from previous years according to the new standards. As a result, the company announced the financial results according to the data available under IFRS 17 and IFRS 9, and the data that is not in accordance with the new standards was indicated by the number “0”.

The following detailed explanation covers the announced financial statements and the updated financial statements attached to this announcement, which are consistent with the way financial results are presented in accordance with the new standards:

The reason for the increase in net profit before zakat for the current period compared to the same period in the previous year by +43 million SAR (-203.1%) is due to the following main effects:

1. Positive decrease in total underwriting costs and expenses by SAR 45.6 million (driven by decrease in claims incurred, increase in policy acquisition costs, and decrease in net revenue)
2. Investment income decreased by 2.6 million Saudi riyals

“We draw attention to Note No. 2 of the attached condensed interim financial information, which states that the company recorded net cash outflows from operations in the amount of 36.98 million Saudi riyals (June 31, 2022 AD (amended): 55.05 million Saudi riyals) as On June 30, 2023, the accumulated losses amounted to 195.69 million Saudi riyals, which represents 45.51% (December 2022 AD (amended): 215.38 million Saudi riyals, representing 50.1% of the company’s capital. On the same date, the company’s insurance revenue decreased by 35.41 million Saudi riyals, representing 23.75% compared to the same period of the previous year.