Takaful International first half profit up 32%

TDT | Manama       

The Daily Tribune – www.newsofbahrain.com

The Board of Directors of Takaful International Company approved the financial results for the period ended June 30, 2023, which were presented in accordance with the new Financial Accounting Standards (FAS) 42, 43, and 30, issued by the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI), which are equivalent to the International Financial Reporting Standards IFRS 17 and IFRS 9.

Q2 results

The net profit attributable to the shareholders was BD 43K for the three months ending on June 30, 2023, a 34% decrease from the net profit of BD65,000 for the same period in the previous year. Comparatively, earnings per share decreased to 0.5 Fils from 0.76 Fils for the same period in the previous year.

The total comprehensive loss for the three months ended June 30, 2023, stood at BD78,000, compared to a total comprehensive loss of BD205,000 for the same period last year. Total net profit was BD 168K during the second quarter of the year 2023, compared to BD 227K for the same period in the previous year, a decrease of 26%.

The General and Family Takaful Funds achieved a surplus of BD 125k during the second quarter of 2023, compared to a surplus of BD 162k for the same period of the previous year, which decreased by 23%.

This decline in the performance of the two Takaful funds is due to the application of the new accounting standards, which are subject to the estimates of the actuary, as they affected the technical reserves and other reserves.

The shareholders’ fund achieved a profit of BD 43K during the second quarter of the year 2023, compared to a profit of BD 65K for the same period of the previous year, a decrease of 34%. Recognised Takaful contributions were BD5.848 million for the period ending on June 30, 2023, compared to BD5.987 million for the same period of the previous year, a decrease of 2%.

Recognised Takaful Costs were BD4.416 million during the period ending on June 30, 2023, compared to BD4.882 million in the same period of the previous year, with a decrease of 10%.

H1 results

The shareholders’ net profit was BD428,000 for the six months ending on June 30, 2023, an increase of 32% from the net profit of BD325,000 for the same period in the previous year. Comparatively, earnings per share increased to 5.04 Fils from 3.82 Fils for the same period in the previous year.

The comprehensive income for the six-month period ending on June 30, 2023, was BD303,000, compared to a profit of BD23,000 for the same period of the previous year. The Company reported a total net profit of BD651,000 during the second quarter of the year 2023, compared to BD898,000 for the same period last year, a decrease of 27%.

The General and Family Takaful Funds achieved a surplus of BD223,000 during the second quarter of 2023, compared to a surplus of BD573,000 for the same period of the previous year, which decreased by 61%.

This decline in the performance of the two Takaful funds is due to the application of the new accounting standards, which are subject to the estimates of the actuary, as they affected the technical reserves and other reserves.

The shareholders’ fund achieved a profit of BD428,000 during the second quarter of the year 2023, compared to a profit of BD325,000 for the same period of the previous year, an increase of 32%.

Recognized Takaful contribution was BD12.282 million for the six months ending on June 30, 2023, compared to BD12.195 million for the same period of the previous year, an increase of 1%.

Recognised Takaful Costs were BD9.740 million during the period ending on June 30, 2023, compared to BD9.011 million in the same period of the previous year, with an increase of 8%.

The company’s shareholders equity amounted to BD11.426 million as of June 30, 2023, compared to BD11.547 million as of December 31, 2022, a decrease of 1%. The company’s total assets increased by 11% from BD42.757 million as of June 30, 2023, to BD38.503 million as of December 31, 2022.

Ebrahim Al-Rayes, Chairman of the Board of Directors, stated that the company was able to achieve good results despite the general high loss ratios in the insurance market and the impact of the new accounting standards on the company’s provisions and technical reserves, which the company recently implemented in accordance with the new accounting standards that were issued by the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOFI) for insurance companies equivalent to the International Financial Reporting Standards (IFRS 17 and 9).

Adding, we are proud to announce that we are the first shareholding company implementing the new accounting standards FAS 43 issued by the Islamic Accounting and Auditing Organisation and that the Board of Directors approved the financial statements, which were in line with the strategic plans approved by the Board at the end of the year 2022.

Essam Al-Ansari, CEO of the company, said that the company launched the second phase of the new automated system project for family takaful operations in the second quarter after successfully launching the first phase for general and motor takaful operations.

This comes while maintaining control over administrative expenses, which were 15.3% of net written contributions compared to 18.1% for the same period of the previous year.