ADNIC reports AED 282.8 million net profit for the first nine months of 2020
05 Nov 2020
Resilient performance with sustained growth across key metrics
- For the nine-month period ended 30 September 2020, net profit increased by 45.5% to AED 282.8 million, compared to a net profit of AED 194.4 million for the same period in 2019
- The overall premium retention ratio reached 32.7% for the nine-month period ended 30 September 2020 compared to 30.8% for the same period in 2019
- ADNIC’s net underwriting income increased by 44.0% to AED 394.7 million, against AED 274.1 million for the same period in 2019
- Net Technical Profit for the nine-month period ended 30 September 2020 increased by 125.5% to AED 201.8 million, against AED 89.5 million for the same period in 2019
- ADNIC’s net investment and other income stood at AED 85.0 million for the nine-month period ended 30 September 2020 compared to AED 106.4 million for the same period in 2019.
Profitable growth maintained
- ADNIC’s gross written premium increased by 6.2% to AED 3.17 billion compared to AED 2.98 billion for the same period in 2019
- General and administrative expenses excluding provision for doubtful debts for nine-month period ended 30 September 2020 decreased by 4.1% to AED 172.2 million compared to AED 179.5 million for the same period in 2019
Abu Dhabi National Insurance Company (ADNIC), one of the leading regional multi-line insurance providers for both corporates and individuals, reported its financial results for the nine-month period ended 30 September 2020 today.
Commenting on ADNIC’s performance, Sheikh Mohamed Bin Saif Al-Nahyan, Chairman of ADNIC, said: “In a year full of uncertainty, our strategic actions have enabled us to deliver resilient results as we recorded a net profit of AED 282.8 million, a 45.5% increase compared to the same period last year. We also won several significant accounts which helped propel the business forward and we continued to accelerate our digital initiatives across the company. Looking at the remainder of the year, we will continue to respond to the increasing digital-first mindset of retail and SME customers through ongoing product and service innovation.”
He added: “On behalf of the Board of Directors, I would like to extend our sincere gratitude to His Highness Sheikh Khalifa Bin Zayed Al Nahyan, President of the UAE, His Highness Sheikh Mohammed Bin Rashid Al Maktoum, UAE Vice President and Prime Minister, and Ruler of Dubai, and His Highness Sheikh Mohamed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, for their continued support. I would also like to thank our clients, partners and shareholders for the continuous trust and confidence they have placed in ADNIC during this challenging period. As one of the leading UAE insurance companies, we will continue to build on our expertise to deliver new innovative solutions and give back to our community throughout the remainder of the year and beyond.”
Ahmad Idris, CEO of ADNIC, said: “I am very pleased to report that ADNIC has demonstrated solid financial performance for the third quarter of 2020 both in terms of gross written premiums as well as net profit. This performance comes as a natural reflection of our comprehensive technical underwriting framework, wide and loyal customer base and our continuous dedication towards delivering market pioneering customer service standards despite the unprecedented and challenging ongoing market conditions. We look forward to concluding this year strongly, while we continue to innovate and strengthen our capabilities to meet the rapidly changing needs of our customers and to achieve superior returns for our shareholders.”
He added: “Moving to the remainder of the year, we will continue to look for ways to remain competitive and fully operational to deliver on our promise as our customers’ reliable insurer. Being a responsible company is fundamental to ADNIC’s long-term sustainability and as we move into the last quarter of the year, we will continue to leverage on our digital facilities and give back to the local community through our long-standing CSR initiatives.”
ADNIC’s technical underwriting results remained solid with 44.0% growth, compared to same quarter last year. Particularly strong gains were achieved in the total insurance premium reaching AED 3.17 billion which is 6.2% growth compared to the previous year with AED 2.98 billion, and the technical profit which increased by 125.5% - reaching 201.8 million in the third quarter of 2020 compared to 89.5 million in the previous year.
The growth in revenue is primarily driven by the Commercial Lines division which has recorded a 12.8% increase compared to the previous year as a result of a successful conversion of new business opportunities. The company delivered a resilient 5% growth across our Employee Benefits division for Q3 2020 on the basis of strong renewal and new business performance.
Retail Motor continues to go through a challenging period as a combination of the overall segment slowdown and the emerging premium rate downward pressure in the market. General and administrative expenses excluding provision for doubtful debts for the nine-month period ended 30 September 2020 decreased by 4.1% to AED 172.2 million compared to AED 179.5 million for the same period in 2019 reflecting the improvement in the operational efficiency.
Total investment income for the year to date (including Other Comprehensive Income) was down 81.4% compared to the same period in 2019. The drawdown experienced in March 2020 continues to be an overhang on year-to-date investment returns. However, the other comprehensive income position improved during Q3 2020 versus Q2 2020 by AED 94.3 million and brought total investment income (including Other Comprehensive Income) for the year to AED 25.8 million.
Supporting the community during COVID-19
Being a responsible company is fundamental to ADNIC’s long-term sustainability and as we move into the remainder of the year, ADNIC will continue to give back to the local community through its wide-ranging and long-standing CSR initiatives and activities. ADNIC’s key priorities are to contribute to improving the health and wellbeing of people at home and abroad in partnership with leading charities and organisations, including Ma’an Abu Dhabi, Al Bayt Mitwahid Association, Bait Al Khair Society, the General Authority of Islamic Affairs, Endowments and Emirates Down Syndrome Association and Companies for Good.