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EFU General Insurance Company Limited declared an unconsolidated net insurance premium of Rs8.6 billion for the nine months ended September 30, 2023, posting an increment of 16% from Rs7.44 billion over the same period last year, reports WealthPK. The company posted a massive growth of 146.3% in the underwriting results during the period. In 9MCY23, the underwriting results stood at Rs227.06 million against the negative results of Rs490.5 million registered in 9MCY22.

The company’s results from operating activities surged by 59.48% to Rs2.27 billion in 9MCY23 from Rs1.42 billion in the corresponding period last year. Its profit-before-tax came in at Rs2.79 billion in 9MCY23, 59.48% higher than Rs1.678 billion in 9MCY22. As a result, at the end of the nine months, its net profitability grew by 55.1% from Rs1.04 billion in 9MCY22 to Rs1.617 billion in 9MCY23. The earnings per share (EPS) of the insurance company increased substantially to Rs8.09 in 9MCY23 from Rs5.21 in the same period last year.

3QCY22 vs 3QCY23

When comparing the third quarter of 2023 to the same period of the previous year, the insurance company's financial performance saw significant improvements. In 3QCY23, the company’s net insurance premium increased to Rs2.74 billion from Rs2.25 billion in 3QCY22, signifying a noteworthy 21.6% growth. The underwriting results for 3QCY23 reached a positive value of Rs597.6 million over a negative value of Rs630.014 million in 3QCY22. Similarly, the company's operating activities surged 3,752.56% from Rs36.37 million in 3QCY22 to Rs1.4 billion in 3QCY23.

In 3QCY23, the insurance company’s profit-before-tax clocked in at Rs1.59 billion, 911.37% greater than Rs157.7 million in 3QCY22. As a result, the insurance company's net profitability rose steeply by 862.3% from Rs100.8 million in 3QCY22 to Rs970.1 million in 3QCY23. This demonstrates that the business significantly managed its financial operations during the nine months of the calendar year 2023. The company observed a surge in EPS from Rs0.5 in 3QCY22 to Rs4.85 in 3QCY23.

Historical trend

The insurance company followed a fluctuating trend in its profitability from 2019 to 2022, peaking at Rs2.7 billion in 2021 and declining to the low of Rs2.005 billion in 2022. In 2019, its net profitability stood at Rs2.6 billion. The gross profit margin followed an upward trajectory from 6.77% in 2019 to 15.82% in 2021, but reduced sharply to 0.68% in 2022.

In contrast, the net profit margin fell gradually over four years from 34.97% in 2019 to 19.49% in 2022.

The company’s EPS growth remained volatile, with negative growth of 9.13% and 25.87% in 2020 and 2022.

The EPS growth remained positive in 2019 and 2021 with values of 20.07% and 14.18%, respectively.

Credit: INP-WealthPk