Bahrain National Holding (Trading Code: BNH) announced its financial results for the mid-year ended 30th June 2020.
The Group achieved a net profit of BD2.55 million for the mid-year ended June 2020, compared to BD2.84 million in the previous mid-year, a decrease of 10%. Net profit attributable to the shareholders for the mid-year 2020 was BD2.41 million, compared to BD2.76 million during the previous mid-year, a decrease of 13%. As a result, earnings per share was 21.4 fils compared to 24.5 fils in mid-year of 2019. The total comprehensive income attributable to the shareholders for the mid-year 2020 was BD898 thousand, compared to BD4 million during the previous mid-year, a decrease of 78%. The Group reported an increase of 3% in gross premiums to BD18.54 million, compared to BD17.98 million in last mid-year whereas the net earned premiums decrease by 3% to BD8.41 million, compared to BD8.68 million of last mid-year. Group achieved an underwriting profit of BD1.94 million during the mid-year 2020, compared to underwriting profit of BD1.36 million in the previous mid-year, an increase of 42%.
The decrease in the net profit for the first half 2020 in comparison to the first half 2019 was predominantly attributable to the impact of COVID-19 pandemic on the Group’s associates, resulting in lower share of profit from equity accounted investees apart from slightly lower net investment income from the investment portfolio. The above impacts were partly offset by higher net underwriting profit as a result of lower net claims as well and lower general and administration expenses related to underwriting operations.
The total shareholders’ equity (excluding non-controlling interest) as at the June 30th, 2020, was BD52.23 million compared to BD53.84 million as at the end of the previous year, a decrease of 3%. Total assets reached BD108.06 million compared to BD105.83 million as at the end of the previous year, an increase of 2%.
Mr. Farouk Almoayyed, Chairman of Bahrain National Holding, Chairman of BNH, commented: “The first half of 2020 was a period of unprecedented challenges posed by the global pandemic and we are very pleased with the manner in which the group has faced up and overcome them. Though some of our associates were impacted, we are confident that their profitability will recover as the situation gradually normalizes and the results of the steps taken by the management of these companies bear fruit. The crisis has resulted in many fundamental changes to the insurance industry and accelerated some of the trends, particularly in the digitalization of services. We are well placed as a Group, to utilize these opportunities to continuously improve our services and products for our customers. We thank the Government of Bahrain and Tamkeen for the various initiatives taken to support businesses through the crisis and we are proud of the Group’s contribution to this national effort.”
Mr. Sameer AlWazzan, Chief Executive of BNH, commented: “We believe that the strong result, achieved in the face of the very difficult circumstances unleashed by the pandemic, is a testament to the underlying strength of the Group’s overall business model, the dedication of our employees and the support of customers. We managed to grow our topline and retain our clients by remaining in close touch with our customers and reacting proactively to the changing needs during the crisis. We recorded a significant increase in our online transactions and used social media and other channels to communicate with our customers. The lower traffic and overall activity levels in the second quarter of the year did reduce our claims in motor and medical lines of business. However, we are closely monitoring emerging claims trends and have maintained our reserves at conservative levels. The pandemic has given an added impetus to accelerate our digitalization strategy and we look forward to roll out enhanced products and services in the near future. Our associate profits were impacted due to COVID-19 related fall in activity, but we are seeing the first signs of normalization in trends particularly in recent months. On the market portfolio investments, the first quarter of the year was very challenging followed by a strong recovery in the second quarter of the year. We exploited the volatility in the markets by following a disciplined approach, while maintaining a well-diversified and liquid portfolio and the results of these efforts are evident. As the economic activity gradually recovers in the second half of the year, we are focused on pursuing our digitalization efforts, and maintaining our leadership position in the Bahrain insurance market.”
The reviewed mid-year consolidated financial statements and the press release are available on our website www.bnhgroup.com and the Bahrain Bourse’s website.