Arig reports increased profits of US$ 42.1 million for 3rd quarter

Arig's performance in 2005 has been marked by significant strides in its underwriting performance. Arig registered an impressive growth in gross premiums by 25% to US$ 144.9 million for 2005 from US$ 115.5 million for the same period last year.

Treaty business displayed a good growth for the period with premiums increasing to US$ 125.0 million from US$ 96.3 million for the same period in 2004. The Asian & Arab regions recorded growth rates of 52% and 25% respectively over the same period in 2004.

Underwriting profit from Arig's core reinsurance operations amounted to US$ 4.7 million as compared to an underwriting deficit of US$ 4.1 million for the first nine months of 2004. In addition, during 2005 Arig also benefited from the capital gains and operating profits of US$ 28.9 million relating to CNIA Assurance, its Moroccan subsidiary that was sold during the second quarter.

During the period ending 30 September 2005, investment income rose to US$ 26.3 million in comparison to an income of US$ 11.0 million for the same period in 2004 leading to a 6.4% annualised investment return.

Arig's Chief Executive Officer, Mr. Udo Krueger, while commenting on the results said

"I am pleased that we are able to demonstrate continued growth in our business position and profitability. We have witnessed favourable developments particularly in the areas of premium growth, underwriting performance and investment income which are a result of the specific strategies that we have implemented."

Shareholders' equity increased by 17% to US$ 261 million compared to US$ 223.1 million at year-end of 2004. As a result, the book value of the Arig share has now increased to US$ 1.32 per share, up from US$ 1.13 at the end of 2004. The share currently trades around US$ 1.35-1.40 representing a price to book ratio of about 1.

For Arig, this quarter has been an important one, especially in the light of the progress achieved in recent business development initiatives. Late in September, Arig announced the launch of a new subsidiary for Islamic Reinsurance - Takaful Re Limited - which has been established at Dubai International Financial Centre (DIFC) in Dubai. Takaful Re is the first significantly capitalised Islamic reinsurance company to offer Shari'a compliant reinsurance products and services and is expected to commence underwriting operations by accepting business during the forthcoming 2006 renewal season.

In addition, Arig is also completing steps to support its growth in the Far East Asian markets through a local presence by setting up a branch office that is expected to commence business activities very soon.