BKIC board proposes cash dividend of 30 per cent

23/02/2016 08:51 AST

Bahrain Kuwait Insurance Company (BKIC)'s board of directors has proposed a cash dividend of 30 per cent to shareholders on the paid-up capital of BD7.15 million, equivalent to 30 fils per share.

A statement said the board has approved financial results for last year, calling them "satisfactory, given the difficult situation prevailing in the region due to low oil prices and also due to severe competition in prices among insurance companies particularly in motor and medical insurance lines".

The net profit recorded was BD2.7m compared with BD4.2m in 2014. The decrease was mainly due to drop in net investment income from BD2.2m in 2014 to BD1.1m in 2015. In 2014 there was profit of BD1.5m on sale of investment property.

Also in 2015, there were new expenditures like contribution to newly established Hit and Run Fund, amounting to BD112,000 (for 27 months effective October 2013) and a provision of BD145,000 towards Zakat in Kuwait office in accordance with the regulations of the country. The profit reduced by BD57,000 due to KD/BD exchange rate.

The additional impairment during the year for investment was BD304,000. At the end of the year, a loss of BD386,000 was booked towards share of losses in one of the strategic investments as per their management accounts.

However, underwriting profits increased by almost 2.4pc from BD2.96m in 2014 to BD3.03m in 2015. Shareholders equity decreased from BD35m in 2014 to BD34.2m in 2015 on account of decrease in currency translation reserve due to unfavourable KD/BD exchange rate.

Invesments fair value reserve also decreased to reflect changes in market values of the investments. The return on equity was 7.92pc (12.11pc in 2014) and earnings per share was 38 fils against 59 fils in 2014.

For the fourth quarter ended December 31, gross earnings were BD3.6m (BD3.6m for the same period in 2014). Net claims decreased to BD1.8m (BD2.1m for the same period 2014). Consequently technical profit increased to BD1.03m in the quarter as against BD620,000 for the same period in 2014.

Investment income during the quarter increased to BD244,000, compared with BD115,000 for the same period of 2014. Over the same period, net profit was BD519,000 as against BD536,000 earlier.

Gross written premium decreased by 4pc from BD39.8m in 2014 to BD38.1m last year mainly due to decrease in premium in medical class caused by non-renewal of some major accounts. However, this reflected positively on the technical results to record an increase of 2.4pc in insurance profits.

Gulf Daily News