Financial Results : Salama Insurance profit falls 29% to SAR 21.5M profit in H1 2024, Q2 at SAR 11.4M

Salama Insurance profit falls 29% to SAR 21.5M profit in H1 2024, Q2 at SAR 11.4M

01/08/2024 Argaam Exclusive

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Salama Cooperative Insurance Co.’s profits dipped 29% to SAR 21.5 million in the first half of 2024, from SAR 30.3 million in the prior-year period.



Financials (M)

Item 6m 2023 6m 2024 Change‬
Gross Written Premium (GWP) 319.49 237.35 (25.7 %)
Insurance Revenues 404.82 365.33 (9.8 %)
Net Profit Before Zakat & Tax 32.30 23.48 (27.3 %)
Net Income 30.30 21.48 (29.1 %)
Average Shares 15.27 20.00 31.0 %
EPS (Riyals) 1.98 1.07 (45.9 %)

The first-half profits were hurt by a decline in revenue, mainly due to a drop in earned revenue. This is primarily due to a decline in gross written premiums (GWPs) for the current period in the company's compulsory vehicle insurance and health insurance sectors compared to the same period last year.

 

Moreover, net profit of the insurance results decreased by 0.60%, or SAR 0.14 million in H1 2024, compared to the same period of the previous year. Net insurance financing expenses increased in the current period by 39.86%, or SAR 0.56 million compared to the same period of 2023.

 

Other operating expenses increased by 30.08%, or SAR 3.73 in H1 2024, compared to the same period of the previous year.

 

Salama also reported a decrease of SAR 9.03 million in other revenues related to the share of surplus from the Hajj and Umrah coinsurance portfolios for the current period, compared to H1 2023.

 

The second-quarter net earnings fell 35% to SAR 11.4 million, from SAR 17.6 million in Q2 2023, due to a drop in revenue, mainly due to lower earned revenue and GWPs.

 

Net profit of the insurance results decreased by 02.93% year-on-year (YoY), while net insurance financing expenses saw a spike of 619.35%, or SAR 580,000 YoY. Other OpEx increased by 433.22% YoY.



Current Quarter Comparison (M)

Compared With The
Item Q2 2023 Q2 2024 Change‬
Gross Written Premium (GWP) 153.64 103.39 (32.7 %)
Insurance Revenues 203.04 176.84 (12.9 %)
Net Profit Before Zakat & Tax 19.15 12.43 (35.1 %)
Net Income 17.65 11.43 (35.2 %)
Average Shares 15.27 20.00 31.0 %
EPS (Riyals) 1.16 0.57 (50.6 %)

Conversely, Salama’s bottom line jumped 13.7% on a sequential basis from SAR 10 million in Q1 2024.

Insurance Operations

Item 6m 2023 6m 2024 Change‬
Gross Written Premium (GWP) 319.49 237.35 (25.7 %)
Insurance Revenues 404.82 365.33 (9.8 %)
Insurance Services Income 22.75 22.61 (0.6 %)
Investment Income 10.23 14.57 42.4 %
Net Profit of Insurance Services and Investment 31.56 35.20 11.5 %

Shareholders’ equity, no minority interest, increased to SAR 226.46 million as of June 30, 2024, compared to SAR 91.15 million a year earlier.

 

Accumulated losses reached SAR 14.24 million by the end of the six-month period, representing 7.12% of the company’s capital.

 

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