UAE: SALAMA posts 2019 profit surge, recommends first dividend since stock listing
Source: Middle East Insurance Review | Mar 2020
Islamic Arab Insurance Company (SALAMA) has posted preliminary unaudited net profit of AED55m ($15m) for the year ended 31 December 2019.
This result is 27.5 times that of the AED2m net profit reported for 2018. The result is bolstered by SALAMA’s effective strategies and strong controls implemented by a new board of directors, the company said in a statement.
The board of directors will recommend the level of cash dividend after final annual financials are released. This will be the first time since the listing of SALAMA on the Dubai Financial Market (DFM) in 2005 that it recommends a cash dividend.
SALAMA’s topline showed an upward trend throughout 2019 reaching AED1.13bn from AED1.06bn in 2018, representing an increase of 6.3%.
SALAMA demonstrated operational excellence and effective underwriting controls, resulting in a 21% growth in underwriting profit to AED183m in 2019 compared to AED151m in 2018. This also had a positive impact on expense management, decreasing the same by AED10m or 8% to AED117m in 2019 from AED127m in 2018 despite the challenging and competitive business environment and without compromising on the quality and speed of service.
At the beginning of 2019, SALAMA set out to improve its investment portfolio. The efforts made have resulted in an 87% increase in SALAMA’s investment income which reached AED23.3m in 2019 from AED12.4m in 2018.
As the UAE’s largest shariah-compliant insurer with ‘AAA’ level capital adequacy, SALAMA also achieved an upgraded rating of ‘BBB’ with stable outlook in 2019.
SALAMA has a paid-up capital of AED1.21bn. It serves individual customers and institutions in the UAE and, through its extensive network of subsidiaries and associates, Saudi Arabia, Egypt and Algeria.
The company offers a comprehensive range of family, motor, general and health takaful solutions. M