Arpico Insurance : Interim Financial Statements as of 31/03/2024

FOR THE PERIOD ENDED

31ST MARCH 2024

Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

Income Statement

			Un-Audited		Un-Audited
For the period ended 31 March	Note	2024	2023
			LKR		LKR
Gross Written Premium	4		568,240,498	730,146,495
Premium ceded to reinsurers	5		(22,268,362)	(23,680,453)
Net written premium			545,972,136		706,466,042
Other revenue
Fees and commission income			5,295,940	6,567,656
Investment income	6		137,828,756	145,100,096
Fair value gains			4,138,612	3,717,667
Other operating revenue			525,588		3,791,948
Total Other revenue			147,788,896	159,177,367
Total net revenue
		693,761,032		865,643,409
Benefits, claims and expenses
Net Insurance Benefits and Claims Paid			(321,229,138)	(402,597,653)
Net change in insurance claims outstanding			(748,071)	5,494,738
Underwriting and net acquisition costs			(97,828,237)	(153,107,839)
Change in contract liabilities - life fund	7		(13,027,767)	(10,246,378)
Other operating, administrative and selling expenses			(170,193,852)	(223,765,502)
Depreciation and amortisation			(24,309,598)	(21,888,532)
Total benefits, claims and expenses			(627,336,663)		(806,111,166)
Profit/(Loss) before Taxation
		66,424,369	59,532,243
Income Tax Expense	8		(19,180,040)	(16,871,720)
Profit/(Loss) for the Period	9		47,244,329		42,660,523
Profit/(Loss) attributable to:
Equity holders of the Company			47,244,329		42,660,523
Basic Earning per Share (LKR)			0.71	0.64
Diluted Earning per Share (LKR)			0.71		0.64

1

Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

Statament of Other Comprehensive Income

	Un-Audited		Un-Audited
For the period ended 31 March	2024	2023
	LKR		LKR
Profit/(Loss) for the Period	47,244,329	42,660,523
Other Comprehensive Income/(Loss)
Net change in fair value of available-for-sale financial assets	125,585,794	48,037,016
Net change in liabilities of insurance contracts arising from fair		1,693,548
value changes in available for sale financial assets
Net change in fair value of AFS reserve transferred to insurance Liabilities	33,185,936	(1,693,548)
Items that will never be reclassified to profit or loss
Acturial loss on defined benefit plan		-
Total Other comprehensive income, net of tax	158,771,730	48,037,016
Total comprehensive Income/(Loss) for the Period, Net of Tax
206,016,059		90,697,539

2

Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

STATEMENT OF FINANCIAL POSITION

		Un-Audited		Un-Audited
As at	Note	31.03.2024	31.12.2023
		LKR		LKR
Assets
Intangible assets		685,389	767,227
Property, plant and equipment		54,594,968	60,343,336
Right of use assets	10	196,290,222	198,167,666
Financial assets	11	4,025,966,683	3,949,884,217
Loans to life policyholders		237,696,284	241,246,301
Reinsurance receivables		23,574,565	11,108,850
Amounts due from related parties	13	-	30,985,542
Premium receivable		177,589,277	91,475,027
Other assets		162,552,911	175,300,705
Cash and cash equivalents		54,077,910	56,396,474
Total Assets		4,933,028,210		4,815,675,345
Equity and Liabilities
Equity
Stated capital	16	675,564,870	675,564,870
Retained earnings		817,693,209	770,448,880
Available for sale reserves		(9,885,187)	(35,537,005)
Total Equity		1,483,372,892		1,410,476,745
Liabilities
Insurance contract liabilities	12	2,906,024,922	2,885,863,883
Employee benefit obligation		17,892,281	15,667,481
Reinsurance payables		48,993,058	37,579,204
Lease liabilities	10	208,447,470	221,777,381
Amounts due to related parties	13	47,354,110	49,590,990
Other financial liabilities		148,663,149	126,283,782
Other liabilities		72,280,328	68,435,879
Total Liabilities		3,449,655,318		3,405,198,600
Total Equity and Liabilities
	4,933,028,210	4,815,675,345
		-	-

These Financial Statements are prepared in compliance with the requirements of the Companies Act No. 07 of 2007.

----------------------------------

S.H.Dulanjith Kaweesha

Financial Controller

The Board of Directors is responsible for the preparation and presentation of these financial statements. Signed for and on behalf of the board.

-----------------------------------	--------------------------------------------
Ramal Jasinghe	Kelum Senanayake
Chairman	Director / Chief Executive Officer
13, March 2024
Colombo.

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Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

STATEMENT OF CHANGES IN EQUITY

	Stated Capital	AFS	Retained Earnings	Total
	Reserve
	LKR	LKR	LKR	LKR
Audited Balance as at 01 January 2023	675,564,870	(216,692,952)	1,458,445,721	1,917,317,639
Profit for the period			42,660,523	42,660,523
Actuarial loss on defined benefit plan			-	-
Other Comprehensive Income / (Loss)
Net change in fair value of available-for-sale financial assets		48,037,016		48,037,016
Total Comprehensive Income for the Period, Net of Tax
Un-Audited Balance as at 31st March 2023	675,564,870	(168,655,936)	1,501,106,244	2,008,015,178
Profit/(Loss) for the period			(726,492,449)	(726,492,449)
Actuarial loss on defined benefit plan			(4,164,915)	(4,164,915)
Other Comprehensive Income / (Loss)
Net change in fair value of available-for-sale financial assets		133,118,931		133,118,931
Total Comprehensive Income for the Period, Net of Tax
Audited Balance as at 31th December 2023	675,564,870	(35,537,005)	770,448,880	1,410,476,745
Profit/(Loss) for the period			47,244,329	47,244,329
Actuarial loss on defined benefit plan				-
Other Comprehensive Income / (Loss)
Net change in fair value of available-for-sale financial assets		25,651,818		25,651,818
Total Comprehensive Income for the Period, Net of Tax
Unaudited Balance as at 31 March 2024	675,564,870	(9,885,187)	817,693,209	1,483,372,892

4

Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

STATEMENT OF CASH FLOWS

		Un-Audited		Un-Audited
For the period ended 31 March	2024	2023
		LKR		LKR
Cash flows from operating activities
Insurance premium received	522,953,954	581,299,209
Reinsurance premium paid	(10,854,508)	(13,940,595)
Insurance benefits and claims paid	(316,140,400)	(416,538,248)
Reinsurance claim received	(12,465,715)	13,940,595
Other operating cash flows	(244,008,111)	(220,101,753)
Cash generated from operating activities		(60,514,780)	(55,340,792)
Tax Paid	(10,304,155)	-
Employee benefits paid	-	(117,250.00)
Net cash generated from operating activities		(70,818,935)		(55,458,042)
Cash flows from investing activities
Acquisition of financial investments	(250,077,347)	(9,382,362)
Proceeds from sale/maturity of investment securities	199,647,679	-
Interest/Dividend received	137,828,756	-
Acquisition of property, plant and equipment	(18,479,392)	(6,339,464)
Net Cash Used in Investing Activities		68,919,696		(15,721,826)
Net Cash Flows Before Financing Activities
	(1,899,239)	(71,179,868)
Cash flows from financing activities
Rent Advance/ payments paid for Right of Use Assets	(419,325)	-
Net cash used in financing activities		(419,325)		-
Net increase / (Decrease) in cash and cash equivalents	(2,318,564)	(71,179,868)
Cash and cash equivalents at the beginning of the year	56,396,474	169,799,599
Cash and cash equivalents at the end of the period		54,077,910		98,619,731

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Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

Notes to the Financial Statements

1. Reporting Entity
   Arpico Insurance PLC ("Company") is a Public limited liability company incorporated and domiciled in Sri Lanka and the ordinary shares of the company are listed on the stock exchange. The company is registered under the Insurance Industry Act No.43 of 2000 and amendments there to. The registered office of the company is located at 310, High level Road,Nawinna, Maharagama and the principal place of business is located at No. 55/20, Vauxhall Lane,Colombo 02.
2. Approval of Financial Statements
   The Unaudited Condensed Consolidated Interim Financial Statements for the quarter ended 31 March 2024 were authorised for issue by the Board of Directors on 13th May 2024.
3. Basis of Preparation
   The Financial Statements of the Company have been prepared on an accrual basis under the historical cost convention and applied consistently with no adjustment being made for inflationary factors affecting the Financial Statements except for the financial assets available for sale and financial assets designated at fair value through profit or loss which are measured at fair value and investment properties valued at fair value.
   The Condensed Consolidated Interim Financial Statements have been prepared in compliance with Sri Lanka
   Accounting Standard "LKAS 34 - Interim Financial Reporting". These Interim Financial Statements should be read in conjunction with the Annual Financial Statements for the year ended 31 December 2023. Furthermore, provisions of the Companies Act No. 07 of 2007 have been considered in preparing the Condensed Consolidated Interim Financial Statements of the Company.
   The same accounting policies have been followed in preparation of these Interim Financial Statements as stated in the Audited Financial Statements for the year ended 31 December 2023.

4.	Gross Written Premium	0
		Un-Audited	Un-Audited
	For the Period Ended 31 March	2024	2023
		LKR	LKR
	First year premium	110,488,391	234,696,931
	Renewal premium	252,138,159	270,072,548
	Group premium	205,613,948	225,377,016
		568,240,498	730,146,495
		568240498.1
5.	Premium Ceded To Reinsurers On Insurance Contracts	(0)
		Un-Audited	Un-Audited
	For the Period Ended 31 March	2024	2023
		LKR '000	LKR '000
	Conventional policies
	Total premium ceded to reinsurers	22,268,362	23,680,453
	Total net written premium
	545,972,136	706,466,042

6

Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

Notes to the Financial Statements

6.	Investment income
			Un-Audited		Un-Audited
	For the Period Ended 31 March	2024	2023
			LKR		LKR
	Held to maturity financial assets
	Interest Income	44,519,846	45,236,938
	Loans and receivables
	Interest Income	83,971,513	81,233,122
	Available For Sale Financial Assets
	Interest Income	9,337,397	18,630,036
	Dividend income	-	-
			137,828,756		145,100,096
			137,828,756
7.	Change in contract liabilities - life fund	-

As per the requirement of SLFRS 4 ,the Liability Adequacy Test with respect to Life insurance provision was performed as at 31st December 2023 .

8.	Income Tax Expense
			Un-Audited		Un-Audited
	For the Period Ended 31 March	2024	2023
			LKR		LKR
	Income tax on current period profit	19,180,040	16,871,720
	Total current income tax		19,180,040		16,871,720
			(19,180,040)
9.	Profit/(Loss) from life insurance	-

No surplus or deficit transfer has been made from the life insurance fund to the Income Statement for quarter ended 31st March 2024.

10. Right of Use Assets

		Un-Audited		Audited
As at	31.03.2024	31.12.2023
		LKR		LKR
Openning balance		198,167,665		163,439,549
Additions of right of use lease asset during the period	11,954,281	120,713,332
Depreciation for the period	(16,084,058)	(98,707,883)
Advance payment for leases	2,252,334	12,722,667
Clossing balance		196,290,222	198,167,665
		196,290,222
Lease liabilities	0
		Un-Audited		Audited
As at	31.03.2024	31.12.2023
		LKR		LKR
Openning balance	221,777,381	175,394,254
Additions during the period	11,954,281	120,713,332
Finance cost recognised in profit and loss	5,444,591	41,208,804
Lease payments		(30,728,783)	(115,539,009)
Clossing balance		208,447,470	221,777,381

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Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

Notes to the Financial Statements

11.	Financial Assets
			Un-Audited		Audited
	As at	31.03.2024	31.12.2023
			LKR		LKR
	Loans and receivables (11.1)		2,353,619,838		2,193,341,372
	Available-for-sale financial assets (11.2)	561,268,549	547,159,911
	Held to Maturity (11.3)	989,941,747	1,091,046,901
	Fair Value through profit & Loss (11.4)	121,136,549	118,336,033
			4,025,966,683	3,949,884,217
			0
11.1 Loans and receivables		Un-Audited		Audited
		31.03.2024	31.12.2023
			LKR		LKR
	Amortised cost
	Debentures	665,566,133	653,557,573
	Fixed deposit	1,168,048,351	1,114,975,140
	Reverse repurchase agreements	389,844,487	242,836,584
	RPAF loan	101,058,356	100,000,000
	Treasury bills		29,102,511		81,972,074
			2,353,619,838		2,193,341,372
		-
	Available-for-sale financial assets		Un-Audited		Audited
		31.03.2024	31.12.2023
			LKR		LKR
11.2 Treasury bonds		289,136,644		300,321,631
	Quoted equities		272,131,905	246,838,280
			561,268,549	547,159,911
		0
11.3 Held to Maturity		Un-Audited		Audited
		31.03.2024	31.12.2023
			LKR		LKR
	Treasury bonds		989,941,747		1,091,046,901
			989,941,747		1,091,046,901
		-
11.4 Fair Value through profit & Loss		Un-Audited		Audited
		31.03.2024	31.12.2023
			LKR		LKR
	Unit trust		121,136,549		118,336,033
			121,136,549		118,336,033
		-
12.	Insurance Contract Liabilities
			Un-Audited		Audited
	As at	31.03.2024	31.12.2023
			LKR		LKR
	Balance as at 1 January		2,885,863,000		2,241,859,388
	Change in contract liabilities life fund
	Increase in life insurance fund before surplus transfer	(13,024,014)	(357,221,693)
	Surplus transferred from / (to) shareholders	-	948,956,234
	Increase in life insurance fund		2,872,838,986	591,734,541
	Movement in AFS reserve transferred to life fund		33,185,936		52,269,954
	Life Insurance Fund balance as at period end	2,906,024,922	2,885,863,883

8

Arpico Insurance PLC

Interim Financial Statements - Quarter 1 - 2024

13.	Related Party Transactions
13.1	Amounts Due to Related Party
				Un-Audited		Audited
	As at		31.03.2024	31.12.2023
				LKR		LKR
	Related Party	Relationship
	Richard Pieris & Company PLC	Ultimate Parent	7,527,120	11,696,838
	Richard Pieris Distributors Limited	Fellow Subsidiary	39,826,990	37,894,152
	Arpico Interiors (Pvt) Ltd	Fellow Subsidiary	-
	Arpitech (pvt) Ltd	Fellow Subsidiary	-	-
				47,354,110		49,590,990
				47354109.75		49590990.19
			-	(1)

13.2 Amounts Due From Related Parties

			Un-Audited		Audited
As at		31.03.2024	31.12.2023
			LKR		LKR
Related Party	Relationship
Richard Pieris & Company PLC	Ultimate Parent	-	30,985,542
Richard Pieris Distributors Limited	Fellow Subsidiary			-
			-		30,985,542

1. Contingent Liabilities
   Contingent liabilities are not recognized in the Statement of Financial Position but disclosed if there is a possible future obligation as a result of a past event or if there is a present obligation as a result of a past event but either a payment is not probable or the amount cannot be reasonably estimated as at the date of Statement of Financial Position. As at the 31 December 2023 ,end of the interim period no material capital commitment and contingengencies approved by the board and contracted for which no provision has been made in interim financial statements.
2. Events Occurring After The Reporting Date
   The directors give due consideration to and where necessary adjustments or disclosures are made in the current Financial Statements in respect of material post Statement of financial position events as appropriate. There have been no material event occurring after the reporting date that require adjustments to or disclosure in the interim financial statements.
3. Stated Capital

		Un-Audited		Audited
As at 30 September	2024	2023
		LKR		LKR
Ordinary Shares		675,564,870		675,564,870
		675,564,870		675,564,870
No of Ordinary Shares		66,230,407		66,230,407
	609,334,463

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