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Bupa Arabia for Cooperative Insurance Co. announces its Interim Financial Results for the Period Ending on 2019-06-30 ( Six Months )

Element ListCurrent QuarterSimilar quarter for previous year%ChangePrevious Quarter% Change
Gross Written Premiums (GWP) 2,438,8022,019,61120.7562,905,447-16.061
Net Written Premiums (NWP) 2,408,3531,992,47520.8722,884,778-16.515
Net Incurred Claims 1,782,0151,537,73315.8851,911,022-6.75
Net Profit (Loss) of Policy Holders Investment 33,68522,12652.24133,689-0.011
Profit (Loss) Insurance Operations Minus Policy Holders Investments Revenues (Operations Results) 170,648146,74116.29139,705329.789
Net Profit (loss) of Shareholders Capital Investment 28,03123,20020.82323,13921.141
Net Profit (Loss) before Zakat 216,074178,86320.80494,122129.568
Total Comprehensive Income 198,334149,61332.564124,39959.433
All figures are in (Thousands) Saudi Arabia, Riyals
Element ListCurrent PeriodSimilar period for previous year%Change
Gross Written Premiums (GWP) 5,344,2494,508,76818.53
Net Written Premiums (NWP) 5,293,1324,464,96818.548
Net Incurred Claims 3,693,0373,265,57113.09
Net Profit (Loss) of Policy Holders Investment 67,37345,06049.518
Profit (Loss) Insurance Operations Minus Policy Holders Investments Revenues (Operations Results) 210,356115,28482.467
Net Profit (loss) of Shareholders Capital Investment 51,17043,99016.321
Net Profit (Loss) before Zakat 310,197188,21164.813
Total Comprehensive Income 304,144129,430134.987
Total Share Holders Equity (after Deducting Minority Equity) 2,887,1382,303,33925.345
Profit (Loss) per Share 2.191.2
All figures are in (Thousands) Saudi Arabia, Riyals
Element ListExplanation
Increase (Decrease) in Net Profit for Current Quarter Compared to the Same Quarter of the Previous Year is Attributed to The increase in profits before Zakat and Income Tax for the quarter of SR 37,211K compared with same quarter last year was due to the following main reasons:

• Increase in underwriting results of SR 66,231K compared with the same quarter last year, an increase of 17.3%.

• Increase in Investment and other income of SR 15,918K compared with the same quarter last year, an increase of 31.2%.

These favorable movements were partially offset with an increase in the provision for doubtful receivables of SR 5,262K compared with the same quarter last year, an increase of 6.7% and an increase in operating expenses of SR 35,277K compared with the same quarter last year, an increase of 22%. Policyholders’ share of insurance operations’ surplus also increased to reach SR 20,433K in the current quarter versus SR 16,034K in the same quarter last year.

Net earned premiums increased by SR 311,083K compared with the same quarter last year, an increase of 15.8%, while net claims incurred increased by SR 244,282K compared with the same quarter last year, an increase of 15.9%.

Gross Written Premiums (GWP) increased by SR 419,191K in the quarter compared with the same quarter last year, an increase of 20.8%.

Increase (Decrease) in Net Profit for Current Quarter Compared to the Previous Quarter is Attributed to The increase in profits before Zakat and Income Tax for the quarter of SR 121,952K compared with previous quarter was mainly due to:

• Increase in net underwriting results of 96.7%, reaching SR 449,265K in the current quarter.

• Increase in investment and other income of 6.9%, reaching SR 66,927K in the current quarter.

These favorable variances were offset by an increase in operating expenses, including provision for doubtful receivables and policyholders’ share of insurance operations’ surplus, of 52.4% to reach SR 300,118K in the current quarter.

Increase (Decrease) in Net Profit for Current Period Compared to the Same Period of the Previous Year is Attributed to The increase in profits before Zakat and Income Tax for the period of SR 121,986K compared with same period last year was due to the following main reasons:

• Increase in underwriting results of SR 127,748K compared with the same period last year, an increase of 23.2%.

• Increase in Investment and other income of SR 35,418K compared with the same period last year, an increase of 37.6%.

• Decrease in the provision for doubtful receivables of SR 16,625K compared with the same period last year, a decrease of 18.5%.

These favorable movements were partially offset with an increase in operating expenses of SR 46,065K compared with the same period last year, an increase of 13.2%. Policyholders’ share of insurance operations’ surplus also increased to reach SR 27,773K in the current period versus SR 16,034K in the same period last year.

Net earned premiums increased by SR 570,297K compared with the same period last year, an increase of 14.6%, while net claims incurred increased by SR 427,466K compared with the same period last year, an increase of 13.1%.

Gross Written Premiums (GWP) increased by SR 835,481K in the period compared with the same period last year, an increase of 18.5%.

Basis of the External Auditor's Opinion Unmodified opinion
Modification, Qualification or Emphasis of a Matter as Stated within the External Auditor Opinion The external auditors interim review report on the financial statements mentions that the financial statements have been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting” as endorsed in the Kingdom of Saudi Arabia.
Reclassification of Comparison Items The company has updated its accounting policy to account for zakat and income taxes in the statement of income based on the recent instructions issued. This aligns with IFRSs adopted in the Kingdom of Saudi Arabia and other pronouncements and standards endorsed by Saudi Organization of Certified Public Accountants (“SOCPA”). Accordingly, the Company changed its accounting treatment for zakat and income tax by retrospectively adjusting the impact in line with International Accounting Standard 8 “Accounting Policies, Changes in Accounting Estimates and Errors”. The change has resulted in an increase of reported income of the Company for the period ended 30 June 2018 by SR 1.1 million. This reclassification has also resulted in recognizing a Deferred Tax Asset (DTA) as of 30 June 2019 for an amount of SR 32,161K compared to SR 25,552K recognized as of 31 December 2018. No other impact on the statement of cash flows, statement of financial position and statement of income.
Additional Information Total Insurance Operations Comprehensive Income for the current quarter is SR 7,978K compared to SR (3,429)K for the same quarter of the last year, an increase of 332.7%, and SR 9,641K for the previous quarter, a decrease of 17.3%. Total Shareholders Comprehensive Income for the current quarter is SR 190,356K compared to SR 153,042K for the same quarter of the last year, an increase of 24.4%, and SR 90,472K for the previous quarter, an increase of 216.7%. The earnings per share (EPS) after Zakat and income tax for the current Period are SR 2.19 per share versus SR 1.20 per share for the same period last year. Total Shareholder Equity (no minority interest) as at end of current period is SR 2,887 Million versus SR 2,324 Million as at end of same quarter last year, an increase of 24.3%.

The profits after Zakat and Income Tax for the current quarter reached SR 186,026K compared to SR 157,389K for the same quarter of last year, an increase of 18.2%.

The profits after Zakat and Income Tax for the current period reached SR 261,559K compared to SR 144,170K for the same period of last year, an increase of 81.4%.

The Capital Market Authority and the Saudi Stock Exchange take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure, and the issuer accepts full responsibility for the accuracy of the information contained in it and confirms, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts or information the omission of which would make the disclosure misleading, incomplete or inaccurate.

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