Net profit forecast to quadruple by 2010

SALAMA Islamic Arab Insurance Company, the world’s largest Takaful and Re-Takaful company has announced a provisional 2005 net profit of AED 110 million (US $30.14m), up from AED 3.599m (US $1m) in 2004.

“By any measure this is a remarkable business performance. The provisional profit is 1.7 times more than the profit projected for 2005 at the time of our Initial Public Offering in June last year, and roughly double the profit announced for the first nine months of 2005,” said Sheikh Khaled bin Zayed bin Saqr Al Nehayan, Chairman of SALAMA Islamic Arab Insurance Company.

We fully expect this strong growth in profitability to continue in 2006 and beyond, driven by a very aggressive expansion into new markets and products. We are investing close to AED 1 billion in growing the company and are confident net profits will be higher in the coming years.”

Other plans for 2006 include the establishment of a Re-Takaful company in Saudi Arabia, setting up a Takaful arm in Malaysia, the launch of a family Takaful company in Egypt and incorporation of SOSAR Life, a family Takaful provider in Senegal. In addition, SALAMA has a major stake in the IAIC Saudi Arabia, an insurance company licensed by the Saudi Arabian Monetary Agency (SAMA).

2005 was an excellent year for SALAMA. Not only was the IPO a major success but we also acquired a majority stake in TARIIC and BEST RE, the world’s largest Re-Takaful company. In addition we made a strong debut on the Dubai Financial Market and successfully rebranded the company,” said Dr Saleh Malaikah, CEO, SALAMA Islamic Arab Insurance Company.

SALAMA Profit Soars – 2

There will be no let up in 2006. The company’s activities are set to grow substantially over the next 12 months. Our strategy is to expand SALAMA’s geographic reach and to diversify our income stream and product base to place the company in a position to take advantage of the emerging opportunities in the Takaful and Re-Takaful markets.”

Dr Malaikah explained the company’s final results will be published by the end of March 2006. He said the company needed additional time to consolidate financial information from its subsidiaries, particularly BEST RE which has to obtain account confirmations from companies doing business with it. “This is inherent due to the nature of the re-insurance business,” added Dr Malaikah.

SALAMA expects global demand for Takaful and Re-Takaful products and services to grow significantly over the next five years. Market value is forecast to increase from US $1.7 billion to between US $7.5 billion and US $10 billion.

SALAMA was listed on the Dubai Financial Market in October 2005, following the IPO, which helped raise the company’s capital to Dhs 1 billion. SALAMA has six Takaful companies and provides services in 70 countries through Tunisia-headquartered BEST RE.