Qatar General Insurance & Reinsurance Company Q.P.S.C. (QGRI) Earnings Call Transcript & Summary

Hello, and welcome to Qatar General Insurance. Please note that this call is being recorded. [Operator Instructions] I'd like to hand the call over to our moderator, Shahan. Please go ahead.

Thank you, and hello, everyone. I want to welcome you to QGRI's Second Quarter 2025 Financial Results Conference Call. So on this call from management, we have the Group CFO, Omar Alsabbah; and Ibrahim Abdallah, Assistant Manager for Treasury and Investments and IR Officer. So as usual, we will conduct this call with, first, management reviewing the company's results; followed by a Q&A session. I will turn the call over now to Ibrahim. Please go ahead.

Thank you, Shahan. Good afternoon, ladies and gentlemen. Welcome to the earnings conference call of Qatar General Insurance & Reinsurance Company, which will be referred to by QGIRCO or the company going forward for the first half of 2025 that ended on June 30. I'm Ibrahim Abdallah, QGIRCO's Investor Relations Officer, and it is worth starting our investors call with a disclaimer. Thereafter, we will provide you with a summary of our operational and financial results. I will now read out the disclaimer of this conference call. This call may contain, constitute or imply information or forward-looking statements regarding the operational or financial performance and future of QGIRCO or any of its subsidiaries. Such statements are based on the current expectations and assumptions of QGIRCO's management to their best knowledge and diligent assessment. As such, QGIRCO, its directors and its officers shall not be liable for any costs or losses resulting from using forward-looking statements throughout this call. I'm delighted to give the floor to our Group CFO, Mr. Omar Alsabbah, who will discuss the company's financial results and operational update.

Thank you, Ibrahim. We are pleased to report that Qatar General Insurance & Reinsurance Company delivered a strong financial performance in the first half of 2025, showing continued improvement compared to the same period in 2024. Net profit for the period reached QAR 74.2 million, a substantial increase from QAR 48.3 million in the same period of 2024. This reflects the positive impact of the ongoing efforts to enhance efficiency across the group. The insurance service result stood at QAR 40.1 million compared to QAR 49.2 million in the same period last year. This decline is aligned with our strategic portfolio review as we continue to shift focus towards more profitable business, an approach that will result -- will support long-term sustainable growth. The result also reflects the impact of a revised expense allocation introduced at the end of 2024, which we expect to normalize by year-end. On the investment side, performance improved to QAR 92.3 million, up from QAR 80.2 million in the same -- in the first half of 2024. The increase was mainly driven by higher rental income, net realized gains and other income. This was partially offset by a reduction in dividend income recognized during the period. We continue to exercise disciplined cost management. The other operating and administrative expenses decreased to QAR 31 million, down from QAR 47.8 million in the first half of 2024 as we remain committed to efficiency -- efficiently managing our expenses. Finance costs also declined to QAR 28.6 million, a 27% reduction from QAR 39.3 million last year. This was largely due to the ongoing deleveraging of Al Rayan Bank loan and the benefit of lower interest rates. As a result, the shareholders' net profit reached QAR 74.5 million with earnings per share of QAR 0.08 for the period 30 June 2025. Qatar General Insurance & Reinsurance continues to remain and maintain a strong financial position with total assets exceeding QAR 5.6 billion, and shareholders' equity standing above QAR 3.5 billion. With that, I will now hand over to Mr. Ibrahim to take you through the outlook.

Thank you, Omar. The World Bank forecasts Qatar economy to grow by 2.4% in 2025 and at an annual rate of 4.1% going forward. This growth is anticipated to be driven by the expansion of gas production and new manufacturing projects. Let's discuss QGIRCO's insurance business. QGIRCO's management anticipates continued growth in the insurance sector driven by Qatar's economic diversification efforts, including infrastructure development, digital transformation and the expansion of the oil and gas industry. QGIRCO is likely to expand its product offering and tailor services to meet the needs of a diversified company -- economy, including innovative insurance solutions in emerging sectors such as cyber insurance and renewable energy. Regarding QGIRCO's investment in real estate business, we expect a substantial increase in income from our real estate business for the year 2025 as we maintain high occupancy in our properties through the signing of the rental agreement of General Tower with the government entity. Regarding the investment outlook. In 2025, the Qatar Stock Exchange has shown positive performance, reflecting the overall resilience of the Qatar economy. QSE index has experienced a slight improvement year-to-date even through the tariffs market turmoil and geopolitical instability, which was ultimately supported by strong corporate earnings, particularly in sectors such as finance, real estate and energy. Analysts remain optimistic about QSE's future performance, expecting continued growth as the economy diversified and infrastructure projects progressed and the expected interest rate cuts in the second half of 2025. QGIRCO is currently weighing options to diversify its liquid strategy investment portfolio and explore further diversification opportunities. Finally, on an income statement level, financing costs are expected to decrease substantially due to the expected rate cuts in the second half of 2025 and the deleveraging of Al Rayan Bank loan. QGIRCO continues to pursue its deleveraging plans through selling its non-income-generating assets, and this should improve the overall liquidity and debt ratios of the company. With this being said, it is worth to note that the outlook has been fully presented, and I would like to note that this call and the fact sheet will be available on the Investor Relations section of our website, www.qgirco.com, by the end of tomorrow. Kindly feel free to reach out to us through our contact in the Investor Relations section. Ladies and gentlemen, on behalf of the whole QGIRCO team, thank you very much. We wish you a great day ahead. If you have any questions, please go ahead now.