Saudi Reinsurance Company “Saudi Re” announced its financial results for the first quarter of the financial year 2023 with a strong growth in gross written premium reaching SR 1.07 billion, an increase of 79% compared to the same period last year.
The increase in gross written premium was driven by positive developments in the company’s strategic initiatives. The successful implementation of the local cession mechanism played a significant role in this growth, in addition to the development in the inherent defects insurance segment, which Saudi Re underwrites on a 100% exclusivity basis. The company also obtained an A- credit rating from S&P, which supports the expansion of its client base domestically and internationally.
Fahad Al-Hesni, the Managing Director and CEO of Saudi Re, stated, “We maintained the strong growth momentum, capitalizing on our competitive advantage in the home market while strategically diversifying into other territories. We have successfully leveraged opportunities in regions experiencing a favorable increase in pricing, particularly in Asia. This achievement reaffirms our commitment to delivering value to our stakeholders and reinforces our position as a leading player in the reinsurance industry. Al-Hesni also emphasized the company’s commitment to exploring options that enhance its capital base and reinforce future expansion endeavors.”
The results of Q1 reflected an improvement in the Company’s reinsurance and investment performance, which were represented by the growth in reinsurance service results by 491% compared to last year, in addition, the Investment income has increased by 432% driven investment classes’ reallocation interest rate hikes. Net income before zakat decreased by 46% primarily due to finance expenses as opposed to the finance income of the comparative quarter. This decrease was influenced by changes in interest rates and foreign currency exchange. Moreover, the restated financials for the investment in investee has shown a higher profit in the similar quarter of last year compared to the current quarter. Moreover, the total shareholders’ equity grew by 6% recording SAR 1.028 billion SAR by the end of the period.
Starting from January 1, 2023, Saudi Re has adopted IFRS 17 and IFRS 9, as endorsed in Saudi Arabia. The retrospective application of these standards has led to changes in the presentation of financial statements from Q1 2023 onwards, with comparative periods restated under the new standards.
Saudi Re operates in more than 40 countries across the Middle East, Asia, Africa and Lloyd’s market in the UK, and specializes in life and non-life treaty and facultative reinsurance solutions. The company is also assigned financial strength ratings of A3 rating by Moody’s and A- from S&P.