KUALA LUMPUR (July 27): Syarikat Takaful Malaysia Keluarga Bhd (Takaful Malaysia) reported an 11.9% increase in its latest quarterly net profit to RM50.42 million, from RM45.07 million a year ago, attributed mainly to higher net wakalah fee income.

Gross earned contributions for the second quarter ended June 30, 2018 (2QFY18) stood at RM510.50 million, up 14% from RM447.405 million in the same quarter last year.

This resulted in an earnings per share of 6.12 sen against 5.55 sen previously, the takaful operator said in a filing with the stock exchange. 

Revenue rose 11.8% to RM542.43 million, from RM485.34 million in the corresponding quarter last year. Takaful Malaysia attributed the higher revenue to higher sales generated by its Family and General Takaful business, which was partially offset by fair value losses.

During the quarter under review, the group’s general takaful business saw a 69% year-on-year (y-o-y) increase in net benefits and claims, mainly related to fire and motor classes. Gross earned contributions increased by 23.9%, due to the same reason.

However, net benefits and claims for the group's family takaful business contracted by 5%, due to lower surrender and medical claims. This was despite a 10.2% growth in gross earned contribution from higher sales of its credit-related products.

Takaful Malaysia's Indonesian operations, meanwhile, recorded a widened loss before zakat and tax at RM700,000, compared with RM100,000 in the previous corresponding quarter.

“The Indonesian operations continued to be impeded by the window concept of promoting Islamic products practiced by the conventional domestic players. The Takaful industry in Indonesia is anticipated to continue experiencing challenges, due to financial market volatility, in addition to economic conditions,” the group said.  

Takaful Malaysia said cumulative net profit the first half of the current financial year (1HFY18) stood at RM120.40 million, up 18.2% from RM101.82 million in the same period last year.

Revenue for the first six months improved 12.5% to RM1.29 billion, compared with RM1.15 billion in 1HFY17.

Gross earned contributions for the period came in at RM1.02 billion, representing an 11% increase from RM917.90 million in 1HFY17.

For the remaining months, Takaful Malaysia said it will continue to increase its product and service accessibility to consumers, by intensifying its online marketing initiatives.

“The company will also embark on multiple digital initiatives to further develop ‘customer centric’ value propositions to remain competitive in the industry. 

“Takaful Malaysia will continue to emphasise the four core areas of customer reach, operational agility, cost competitiveness and stakeholder confidence to firmly establish the Company as the preferred choice for insurance amongst consumers,” the filing added.

Shares of Takaful Malaysia closed unchanged at RM3.90 today, valuing the group at RM3.21 billion.