Doha Insurance Group Q.P.S.C. (DOHI) Earnings Call Transcript & Summary

Hello, and welcome to the Doha Insurance Conference Call. Please note that this call is being recorded. We will have the opportunity to ask questions to our speakers later on during the Q&A session. [Operator Instructions] I'd like to hand over the call to our moderator, Phibion Makuwerere. Phibion, please go ahead.

Thanks, Mark, and good afternoon to you all. And thank you for joining us for this Doha Insurance Group's 3Q and 9 months 2024 earnings conference. My name is Phibion Makuwerere. I'm with QNB Financial Services. On today's call from to insurance, we have Ghaith Jardaneh, who is the Chief Financial Officer. As usual, he will go over the performance and we have a Q&A session afterwards. Over to you, Ghaith. Please go ahead.

Good afternoon, everybody. Just to brief you about Doha Insurance Group's third quarter results. So gross premiums for the year of '24, up to 30th of September 2024, reached QAR 1.7 billion compared to QAR 1.2 billion last year. Out of that, insurance revenue reached QAR 1.17 billion compared to QAR 1.035 billion last year. A lot of the growth in gross written premium is yet to be earned. That's why we have a much larger increase in gross written premium compared to insurance revenue. As many of this growth in premiums is earned, we expect major increases in insurance revenue in coming periods. As for the segmentation of our gross written premiums, the current period saw an increase in our fire and general accident segment, which grew from 43% of total premiums at the company to 49%. This came at the expense of the marine and aviation lines of business, which declined from 19% to 14%. The motor line of business held steady at 16% and so did life and medical, it was relatively steady at approximately 21%. The first 9 months of 2024 saw a major increase in the loss ratio of the company. The company experienced a very favorable loss ratio last year for the same period. The increase in loss ratio was the result from increases in claims in both the medical and life insurance lines of business and the motor insurance line of business. Net commission expense has increased from QAR 37 million to QAR 46 million. However, as a percentage of insurance revenue, it has declined from 3% to 2.7%. Overall, the company's -- even though there was growth on the top line, the company still faced a decline in its net insurance results, declining from QAR 100 million last year to QAR 94 million this year. Even at the margin, the net technical results margin relative to insurance revenue has declined from 9.7% last year to 8% this year. Operating expenses increased in 2024 from QAR 91 million last year to QAR 96 million this year. However, as a percentage of insurance revenue, they declined from 8.8% to 8.2%. Investment returns have improved in the first 9 months of 2024 compared to the first 9 months of 2023. We were able to achieve a return on our investment portfolio on an annualized level that reached 6.1% compared to 4.6% last year. The combined ratio at the company increased from 78% to 83%. This was driven by increase in loss ratios. The company was able to achieve a net income of QAR 145.4 million in the first 9 months of 2024 compared to QAR 133.6 million last year. The improvement in net income was bolstered by the favorable returns from our investment activities, and those were enough to achieve growth for the company despite the drop in technical results. On an annualized level, the current return on equity achieved by the company for the first 9 months of 2024 reached 15.6% compared to 15.3% last year. The company's total assets have reached QAR 3.2 billion compared to QAR 2.7 billion. This growth was mainly driven by also the increase in liabilities due to the increased activity, and increased insurance activity occurring at the company has resulted in a larger insurance contract liability component increase in our liabilities. This was also reflected in -- since a lot of this growth in premium is reinsured, our insurance contract asset accordingly has increased by a similar percentage, resulting in both the growth in total assets and growth in total liabilities. The company is still considered very solvent and enjoys a large investment portfolio of QAR 1.4 billion, which constitutes almost 300% of its net insurance contract liabilities. Furthermore, the company was able to achieve days to receivable ratio of 78 days compared to 109 days achieved last year. And the company continues to hold a very good solvency ratio of 257%, far exceeding the 150% that is required by the QCB regulation. Thank you. And please, I return it to you for any questions.

[Operator Instructions] There is no question at this time. I will now turn the conference back over to Phibion for closing remarks. Phibion?

Thanks, Mark. It looks like we don't have any questions on the line, but should you wish to ask questions after the call, please feel free to reach out to QNB Financial Services or to the Doha Insurance management team directly. This brings us to the end of our call, and please do join us for future calls, and good afternoon to you.

Thank you. Thank you very much.

That concludes today's call. Thank you all for joining. You may now disconnect.