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Bupa Arabia for Cooperative Insurance Co. announces the interim financial results for the period ending on 30-09-2015 (Nine Months)

8210
BUPA ARABIA
2.59 %
1437/01/07     01/05/2016 15:44:29
Element Current quarter Similar quarter for previous year % Change current Previous quarter % Change previous
Net profit (loss) before Zakat
285,774
160,349
78.22
113,203
152.44
Surplus (deficit) of insurance transactions less returns of policy holders investment (operating transactions results)
330,755
172,284
91.98
124,528
165.61
Gross written premiums (GWP)
2,257,200
2,120,862
6.43
1,891,373
19.34
Net written premiums (NWP)
2,251,004
2,043,224
10.17
1,885,400
19.39
Net incurred claims
1,156,744
977,310
18.36
1,314,845
-12.02
Net profit (loss) of policy holders investment
2,431
4,692
-48.19
6,010
-59.55
Net profit (loss) of shareholders capital investment
-12,588
2,307
-
-2,178
-477.96
All figures are in (Thousands) Saudi Arabia, Riyals
Element Current period Similar period for previous year % Change
Net profit (loss) before Zakat
435,748
177,404
145.62
Surplus (deficit) of insurance transactions less returns of policy holders investment (operating transactions results)
488,307
178,427
173.67
Gross written premiums (GWP)
6,228,022
4,919,065
26.61
Net written premiums (NWP)
6,209,673
4,838,679
28.33
Net incurred claims
3,774,037
2,564,301
47.18
Net profit (loss) of policy holders investment
14,618
13,665
6.97
Net profit (loss) of shareholders capital investment
-11,726
8,464
-
Earning or loss per share, Riyals
10.9
4.46
-
All figures are in (Thousands) Saudi Arabia, Riyals
Element EXPLAINATION
Reasons of increase (decrease) for the quarter compared with same quarter last year The improvement in results for the three (3) month period ended 30th September 2015, versus the same period of 2014, was mainly due to strong business growth resulting in a higher net earned premium, and combined with an improved, lower, net claims incurred to net earned premium ratio (2015 Q3 at 65.5% versus 2014 Q3 at 74.2%), resulting in a significantly higher net underwriting result. The net underwriting result gains were partially offset by increased growth related operational expenses, such as commissions, levies, bad debt provision expense (2015 Q3 bad debt provision expense of SR69M vs. 2014 Q3 bad debt provision expense of SR4M) and investment and other income losses (2015 Q3 investment and other income loss of SR10M vs. 2014 Q3 investment and other income of SR17M), as well as by a higher Cooperative Distribution expense. The Cooperative Distribution was at SR33M for 2015 Q3, versus 2014 Q3 at SR18M due to the higher 2015 Q3 surplus from insurance operations. Gross Written Premium (GWP) increased by SR136,338K, an increase of 6%, and the net underwriting result for the three month period ended 30th September 2015, versus the same period of 2014, improved by SR269,223K, representing an increase of 79%. The improvement in net earned premium of SR448,657K represented an increase of 34%, versus the same period of 2014. The surplus from Insurance Operations of SR333,186K, is an increase of SR156,210K, versus a surplus of SR176,976K for the same period of 2014, representing an increase of 88%.
Reasons of increase (decrease) for the period compared with same period last year The improvement in results for the nine (9) month period ended 30th September 2015, versus the same period of 2014, was mainly due to strong business growth resulting in a higher net earned premium and, combined with an improved, lower, net claims incurred to net earned premium ratio (2015 year to date Q3 at 76.6% versus 2014 year to date Q3 at 80.3%), resulting in a significantly higher net underwriting result. The net underwriting result gains were partially offset by increased growth related operational expenses, such as commissions, levies, bad debt provision expense (2015 YTD bad debt provision expense of SR83M vs. 2014 YTD bad debt provision expense of SR17M) and adverse investment and other income (2015 YTD investment and other income of SR3M vs. 2014 YTD investment and other income of SR35M), as well a higher Cooperative Distribution expense. The Cooperative Distribution was at SR50M for year to date 2015 Q3, versus year to date 2014 Q3 at SR19M due to the significantly higher 2015 year to date Q3 surplus from insurance operations. Gross Written Premium (GWP) increased by SR1,308,957K, an increase of 27%, and the net underwriting result for the nine month period ended 30th September 2015, versus the same period of 2014, improved by SR524,461K, representing an increase of 83%. The improvement in net earned premium, of SR1,734,197K, represented an increase of 54%, versus the same period of 2014. The surplus from Insurance Operations of SR502,925K, is an increase of SR310,833K, versus a surplus of SR192,092K for the same period of 2014, representing an increase of 162%.
Reasons of increase (decrease) for the quarter compared with the previous quarter The improvement in result in the third quarter of 2015, versus the second quarter of 2015, was mainly due to lower claims in the third quarter of 2015 (due to the seasonality of claims, as reflected by the net claims incurred to net earned premium ratio (2015 Q3 at 65.5% versus 2015 Q2 at 79.8%)) which, combined with an increase in net earned premiums, from SR1,648,696K to SR1,765,151K, an increase of SR116,455K, representing an increase of 7%, resulted in an increase in net underwriting result of SR274,556K, an 82% increase. This was partially offset by an increase in Selling and Marketing expenses driven by commissions and levies, impacted by the seasonality of the Gross Written Premium (GWP), GWP higher in Q3. Gross Written Premiums (GWP) were higher by SR365,827K in the third quarter of 2015, an increase of 19%, versus the second quarter of 2015. The bad debt provision expense was adverse (2015 Q3 bad debt provision expense of SR69M vs. 2015 Q2 bad debt provision expense of SR17M) and investment and other income adverse (2015 Q3 investment and other income loss of SR10M vs. 2015 Q2 investment and other income of SR4M).
External auditor's report containing reservation The joint auditors interim review report on the financial statements mentions that the financial statements have been prepared in accordance with International Accounting Standard 34 and not in accordance with the Standard of interim financial reporting issued by SOCPA. However the company assures that there are no significant differences in the results contained within the financial statements due to using International Accounting Standards rather than the SOCPA accounting standards.
Reclassifications in quarterly financial results Certain comparative figures for the previous period have been reclassified to be consistent with the presentation of the current period.

The Capital Market Authority and Saudi 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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