Karachi: Pakistan Reinsurance Company Limited (PRCL) has reported a significant decrease in its financial performance for the first quarter ended March 31, 2025, with profit after tax dropping by 43 percent compared to the same period last year. The company's earnings per share fell from Rs. 1.05 to Rs. 0.60.

The gross written premium for the quarter rose to Rs. 8,761 million, marking a 49 percent increase from the previous year's Rs. 5,870 million. However, the net premium recorded a decline of 19.5 percent, amounting to Rs. 2,171 million compared to Rs. 2,698 million in the corresponding quarter of the previous year. Meanwhile, net claims surged by 17 percent, reaching Rs. 1,633 million.

Underwriting activities also took a hit, with the company posting an underwriting loss of Rs. 171 million after management expenses, a stark contrast to the profit of Rs. 682 million recorded in the same quarter last year. This represents a decline of Rs. 853 million in the company's underwriting performance.

Investment income, including rentals and other items, saw a 21 percent increase, rising to Rs. 1,034 million from Rs. 852 million in the previous year. Despite the growth in investment income, the profit before tax fell sharply by 44 percent to Rs. 867 million, down from Rs. 1,543 million in the same period last year.

According to information available from the Pakistan Stock Exchange (PSX), the PRCL's Window Re-Takaful business also reported changes. The Participants Retakaful Fund saw its gross written contribution increase by 14.7 percent to Rs. 484 million. The net contribution rose dramatically by 76 percent, reaching Rs. 693.5 million. However, net claim expenses climbed by 130 percent to Rs. 253 million.

The Operator’s Retakaful Fund experienced a 76 percent rise in wakala income, totaling Rs. 139 million. Commission expenses also increased by 50 percent to Rs. 96 million, while general administrative and management expenses grew by 39 percent to Rs. 4.6 million. The profit after tax for this segment was Rs. 33.3 million, up by 240 percent compared to Rs. 9.8 million the previous year.

Pakistan's economic outlook, as projected, indicates a GDP growth of 2.6 percent in 2025, with inflation at its lowest in nearly a decade. The central bank's interest rates are stable at 12 percent. Despite these positive indicators, the country's economy remains susceptible to external pressures, including geopolitical tensions and global financial conditions.

PRCL's board expressed confidence in the company's ability to navigate these challenges and achieve sustainable profitability by adapting to the changing economic landscape. The board extended its gratitude to the company's shareholders, clients, and partners for their continued support and acknowledged the dedication of its staff.

The company remains focused on prudent fiscal policies and strategic responses to maintain its financial health amid external uncertainties.