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CONTENTS

Vision Core Values Corporate Information Directors' report on unconsolidated financial statements Unconsolidated Financial Statements Directors' report on consolidated financial statements Consolidated Financial Statements 1 2 3 5 7 38 39

VISION

THE POWER OF VISION

Our will is to Explore, Innovate and Differentiate. Our passion is to provide leadership to the Insurance Industry.

CORE VALUES

THE POWER OF BELIEF

At Adamjee Insurance its our belief that commitment, passion and a thirst for uncompromising quality leads you to the excellence that we today are recognized for. Integrity: Transparency and Honesty without Compromise Humility: Empathy, Self Esteem and Respect in all relationships Fun at Workplace: Work Life Balance Corporate Social Responsibility: Service to Humanity

CORPORATE INFORMATION

Board of Directors

Umer Mansha Ahmed Ebrahim Hasham Ali Munir Alman Aslam Hassan Mansha Ibrahim Shamsi Khalid Qadeer Qureshi Muhammad Usman Ali Usmani Nabiha Shahnawaz Cheema S. M. Jawed Manzar Mushtaq Chairman Director Director Director Director Director Director Director Director Director Managing Director & CEO

Advisor

Mian Muhammad Mansha

Audit Committee

Umer Mansha Ahmed Ebrahim Hasham Ali Munir Ibrahim Shamsi S. M. Jawed Chairman Member Member Member Member

Human Resource Committee

Hassan Mansha Ibrahim Shamsi Umer Mansha Manzar Mushtaq Chairman Member Member Member

Risk Management Committee

S. M. Jawed Ali Munir Umer Mansha Chairman Member Member

Strategic Committee

Umer Mansha Alman Aslam S. M. Jawed Manzar Mushtaq Chairman Member Member Member

Secretary

Tameez-ul-Haque, F.C.A.

QUARTERLY REPORT MARCH, 2011

03

Chief Financial Officer

Mudassar Zubair Ahmed Mirza, A.C.A., A.C.M.A. (UK)

Registered Office

Adamjee House P.O. Box No. 4850 I.I. Chundrigar Road, Karachi-74000, Pakistan Phone: PABX (92-21) 32412623 UAN: (92-21) 111-242-111 Fax: (92-21) 32412627 E-mail: [email protected] Website: www.adamjeeinsurance.com

Head of Internal Audit

Rehan Ahmed Khan, F.C.A., A.C.M.A.

Executive Directors

Jehangir Bashir Nawaz

Auditors

M/s Riaz Ahmad & Co. Chartered Accountants, Karachi

Shares Registrar

Technology Trade (Pvt.) Limited Dagia House, 241-C, Block-2, P.E.C.H.S., Off Shahrah-e-Quaideen, Karachi Phone: (92-21) 34391316-7, 34387960-1 Fax: (92-21) 34391318

Bankers

Askari Bank Limited Bank Alfalah Limited Bank Al-Habib Limited Barclays Bank PLC, Pakistan Citibank N.A. Habib Bank Limited HSBC Middle East Bank Limited KASHF Microfinance Bank Limited MCB Bank Limited National Bank of Pakistan NIB Bank Limited Oman International Bank S.A.O.G. Rozgar Microfinance Bank Limited Soneri Bank Limited Standard Chartered Bank Limited Tameer Micro Finance Bank Limited United Bank Limited Zarai Taraqiati Bank Limited

04

QUARTERLY REPORT MARCH, 2011

DIRECTORS' REPORT TO THE MEMBERS ON UNCONSOLIDATED FINANCIAL STATEMENTS

FOR THE QUARTER ENDED 31 MARCH 2011

On behalf of the Board, I am pleased to present the unconsolidated financial statements of the Company for the first quarter ended 31 March 2011. The highlights for the period under review are as under: 31 March 31 March 2011 2010 (Rupees in thousand) Gross Premium Net Premium Underwriting Results Investment Income Profit Before Tax Profit After Tax 2,745,629 1,984,814 250,092 198,484 364,604 288,823 2,593,025 1,722,192 232,413 221,175 334,315 247,562 (Restated) Earnings per Share (Rupees) 2.33 2.00

During the period under review, the Company has underwritten the premium of Rs. 2,746 million and registered a growth of 6% over the corresponding period. The first quarter has shown considerable increase in net premium revenue by 15% compared to corresponding period. The underwriting results have improved and the underwritten profit has increased by 8%. Furthermore; there was a decline in management expenses by 6%. The investment income of the Company has declined by 10% as compared to last year due to recording of further impairment in investment during the period. The Profit before and after tax improved by 9% and 17% respectively from the same period last year. The general and administration expenses have reduced considerably by 24%. Mr. Muhammad Ali Zeb, Managing Director & Chief Executive Officer has resigned for personal reasons and his resignation has been accepted by the Board of Directors with effect from 22 March 2011. The Board appreciated the services rendered by Mr. Muhammad Ali Zeb first as Chief Financial Officer and then in the capacity of Chief Executive Officer. Mr. Manzar Mushtaq is being appointed as Managing Director & Chief Executive Officer of the Company with effect from 23 March 2011. We thank our shareholders, valued customers, employees and development staff for their sustained support in ensuring the continued success of our Company and trusting Adamjee Insurance as their brand of first choice. We are also grateful to the Insurance Division, Security Exchange Commission of Pakistan and State Bank of Pakistan for their continued guidance and assistance.

On behalf of Directors

Karachi: 27 April 2011

Umer Mansha Chairman

QUARTERLY REPORT MARCH, 2011

05

Unconsolidated Condensed Interim Financial Statements For the First Quarter ended 31 March 2011

THE POWER OF ACCURACY

At Adamjee Insurance we don't make mistakes, we cant afford to. In a business that prides itself in numbers, accuracy becomes the name of the game. Each number each value is checked and vetted on multiple levels and that's what defines our quest for excellence.

UNCONSOLIDATED CONDENSED INTERIM BALANCE SHEET

AS AT 31 MARCH 2011

Note

31 March 31 December 2011 2010 (Unaudited) (Audited) ­­­­­­­(Rupees in thousand)­­­­­­

Share capital and reserves Authorised share capital Paid-up share capital Retained earnings Reserves

1,500,000 1,237,045 8,799,224 1,152,484 9,951,708

1,500,000 1,237,045 8,634,106 1,163,848 9,797,954 11,034,999

TOTAL EQUITY Underwriting provisions Provision for outstanding claims (including IBNR) Provision for unearned premium Commission income unearned Total underwriting provisions Deferred liabilities Deferred taxation Staff retirement benefits

11,188,753

6,841,729 4,674,538 270,910 11,787,177

7,980,409 5,017,435 305,434 13,303,278

82,444 17,500 99,944

68,353 17,326 85,679

Creditors and Accruals Premiums received in advance Amounts due to other insurers / reinsurers Accrued expenses Other creditors and accruals

86,630 1,146,089 100,978 1,617,245 2,950,942

75,329 1,581,965 147,995 1,520,732 3,326,021

Borrowings Liabilities against assets subject to finance lease Other liabilities Unclaimed dividends TOTAL LIABILITIES CONTINGENCIES AND COMMITMENTS TOTAL EQUITY AND LIABILITIES 6

88,778

107,637

29,117 14,955,958

29,121 16,851,736

26,144,711

27,886,735

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

QUARTERLY REPORT MARCH, 2011

07

Note

31 March 31 December 2011 2010 (Unaudited) (Audited) ­­­­­­­(Rupees in thousand)­­­­­­

Cash and bank deposits Cash and other equivalents Current and other accounts Deposits maturing within 12 months Loans To employees Investments Current assets - others Premiums due but unpaid Amounts due from other insurers / reinsurers Salvage recoveries accrued Premium and claim reserves retained by cedants Accrued investment income Reinsurance recoveries against outstanding claims Taxation - payments less provision Deferred commission expense Prepayments Sundry receivables Fixed Assets - Tangible & Intangible Owned Land and buildings Furniture and fixtures Motor vehicles Machinery and equipment Computers and related accessories Intangible asset - computer software 7

6,938 1,182,879 1,576,255 2,766,072 22,609 9,137,113

59,393 1,060,597 1,584,827 2,704,817 22,086 9,406,998

8 9

4,298,380 1,077,808 171,213 23,252 168,989 5,069,682 5,168 490,915 1,608,209 245,515 13,159,131

4,546,222 993,584 99,636 23,252 33,445 6,253,202 43,697 512,222 1,829,112 317,071 14,651,443

10

278,031 63,914 202,518 296,383 50,672 44,888 936,406

281,472 62,289 197,252 316,190 52,270 48,475 957,948

Leased Motor vehicles

123,380

143,443

TOTAL ASSETS

26,144,711

27,886,735

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

08

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Fire and Property Damage

Marine, Aviation and Transport

Motor

Miscellaneous (Rupees in thousand)

Treaty

Quarter ended Quarter ended 31 March 31 March 2011 2010

Revenue account Net premium revenue Net claims Expenses Net commission Underwriting result Investment income Rental income Other income General and administration expenses Exchange gain-net Finance charges on lease liabilities Profit before tax Provision for taxation Profit after tax

317,722 (235,882) (48,218) (26,410) 7,212

310,706 (120,253) (46,863) (49,052) 94,538

792,830 (541,426) (110,338) (68,661) 72,405

563,556 (414,873) (85,642) 12,896 75,937

-

1,984,814 1,722,192 (1,312,434) (1,066,755) (291,061) (307,859) (131,227) (115,165) 250,092 198,484 165 35,379 484,120 (116,088) 294 (3,722) 364,604 (75,781) 288,823 8,634,106 288,823 (123,705) 8,799,224 232,413 221,175 554 37,909 492,051 (152,788) 400 (5,348) 334,315 (86,753) 247,562 8,520,042 247,562 (168,688) (112,459) 8,486,457 Restated Rupees 2.00

Balance at the commencement of the period Profit after tax for the period Final dividend for the year ended 31 December 2010 @10% (Re.1.0/- per share) [2009:@15%(Rs. 1.5/- per share) Reserve for issue of bonus shares Balance unappropriated profit at the end of the period

Rupees Earnings per share - basic 2.33

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

09

UNCONSOLIDATED CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN INSIDE PAKISTAN

Fire and Property Damage Marine, Aviation and Transport Quarter ended Quarter ended 31 March 31 March 2011 2010

Motor

Miscellaneous (Rupees in thousand)

Treaty

Revenue account Net premium revenue Net claims Expenses Net commission Underwriting result Investment income Rental income Other income

313,262 (235,137) (47,703) (26,567) 3,855

298,484 (120,192) (45,453) (46,570) 86,269

511,149 (369,698) (77,837) (40,798) 22,816

558,780 (414,325) (85,090) 13,141 72,506

-

1,681,675 (1,139,352) (256,083) (100,794) 185,446 198,484 165 24,280 408,375

1,424,838 (905,671) (274,905) (92,564) 151,698 221,175 554 31,982 405,409 (135,090) 400 (5,348) 265,371

General and administration expenses Exchange gain Finance charges on lease liabilities Profit before tax

(104,533) 294 (3,722) 300,414

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

10

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN OUTSIDE PAKISTAN

Fire and Property Damage Marine, Aviation and Transport Quarter ended Quarter ended 31 March 31 March 2011 2010

Motor

Miscellaneous

(Rupees in thousand) Revenue account Net premium revenue Net claims Expenses Net commission Underwriting result Investment income Rental income Other income 4,460 (745) (515) 157 3,357 12,222 (61) (1,410) (2,482) 8,269 281,681 (171,728) (32,501) (27,863) 49,589 4,776 (548) (552) (245) 3,431 303,139 (173,082) (34,978) (30,433) 64,646 11,099 75,745 General and administration expenses Exchange gain -net Finance charges on lease liabilities Profit before tax (11,555) 64,190 297,354 (161,084) (32,954) (22,601) 80,715 5,927 86,642 (17,698) 68,944

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

11

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Quarter ended 31 March 2011

Quarter ended 31 March 2010

­­­­­­­(Rupees in thousand)­­­­­­ Profit for the period Other comprehensive income: Effect of translation of net investment in foreign branches Total comprehensive income for the period (11,364) 277,459 17,605 265,167 288,823 247,562

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

12

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Share Capital Issued, subscribed and paid-up

Capital Reserves Reserve for Reserve for issue of bonus exceptional shares losses Exchange translation reserve Investment fluctuation reserve

Revenue Reserves General reserve Retained earnings Total

(Rupees in thousand) Balance as at 31 December 2009 Total comprehensive income for the quarter ended 31 March 2010 Final dividend for the year ended 31 December 2009 @15% (Rs.1.5/- per share) Transfer to Reserve for Issue of Bonus shares Balance as at 31 March 2010 Total comprehensive income for the Nine months ended 31 December 2010 Interim dividend @ 10% (Re. 1 /- per share) Issue of Bonus shares for the year ended 31 December 2009 Balance as at 31 December 2010 Total comprehensive income for the quarter ended 31 March 2011 Final dividend for the year ended 31 December 2010 @10% (Re.1 /- per share) Balance as at 31 March 2011 1,124,586 22,859 173,424 3,764 936,500 8,520,042 10,781,175

-

-

-

17,605

-

-

247,562

265,167

-

-

-

-

-

-

(168,688)

(168,688)

1,124,586

112,459 112,459

22,859

191,029

3,764

936,500

(112,459) 8,486,457

10,877,654

-

-

-

9,696

-

-

271,354

281,050

-

-

-

-

-

-

(123,705)

(123,705

112,459 1,237,045

(112,459) -

22,859

200,725

3,764

936,500

8,634,106

11,034,999

-

-

-

(11,364)

-

-

288,823

277,459

1,237,045

-

22,859

189,361

3,764

936,500

(123,705) 8,799,224

(123,705) 11,188,753

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

13

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Operating Cash Flows a) Underwriting activities Premiums received Reinsurance premiums paid Claims paid Surrenders paid Reinsurance and other recoveries received Commissions paid Commissions received Other underwriting payments Net cash flow from underwriting activities b) Other operating activities Income tax (paid)/refund General and other expenses paid Loans disbursed Loan repayments received Other receipts Net cash flow from other operating activities Total cash flow from all operating activities Investment activities Profit / return received Dividends received Investments purchased Proceeds from disposal of investments Fixed capital expenditure Proceeds from disposal of fixed assets Income received on Rent Income received on PIBS Income received on TFC Total cash flow from investing activities Financing activities Lease rentals paid Dividends paid Total cash flow from financing activities Net cash outflow from all activities Cash at the beginning of the period Cash at the end of the period 3,016,554 (1,318,966) (2,520,098) (11,782) 1,096,703 (307,860) 159,608 (241,499) (127,340) 2,784,389 (985,951) (1,527,910) (34,758) 78,767 (367,693) 127,543 (401,994) (327,607)

(23,161) (128,998) (6,507) 9,044 4,164 (145,458) (272,798)

(46,963) (146,776) (5,337) 8,669 2,103 (188,304) (515,911)

15,305 61,216 (594,239) 878,589 (29,906) 22,586 165 1,416 1,506 356,638

17,529 117,727 (748,654) 1,238,995 (27,038) 5,919 2,921 1,745 2,344 611,488

(22,581) (4) (22,585) 61,255 2,699,993 2,761,248

(11,362) (1,038) (12,400) 83,177 2,152,653 2,235,830

14

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Reconciliation to Profit and Loss Account Operating cash flows Depreciation expense Provision for gratuity Other income-bank deposits Profit on disposal of fixed assets Financial charges on lease obligations Rental income Decrease in assets other than cash Decrease in liabilities other than running finance Others Gain on sale of investment Amortization expense (Increase)/Decrease in unearned premium Amortisation of income on Government Securities - net Profit on Pakistan Investment Bonds Decrease in loans Income tax paid/(refund) Reversal for diminution in value of investments Dividend, investment and other income Income on TFCs Profit before taxation Definition of cash: Cash comprises of cash in hand, bank balances excluding Rs. 4.824 million (2010: Rs. 4.451 million) held under lien and other deposits which are readily convertible to cash and which are used in the cash management function on a day-to-day basis. Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Cash for the purposes of the Statement of Cash Flows consists of: Cash and other equivalent Cash in hand Current and other accounts Current and saving accounts Deposits maturing within 12 months Fixed and term deposits accounts Total cash and cash equivalents 6,938 1,576,255 1,178,055 2,761,248 2,337 640,818 1,592,675 2,235,830 (272,798) (45,546) (174) 30,968 542 (3,722) 165 (1,587,244) 1,683,333 (194,476) 107,238 (3,922) 342,897 998 3,991 (2,537) 23,161 (93,774) 175,054 5,974 559,080 364,604 (515,911) (43,576) (1,178) 33,640 2,565 (5,348) 554 (158,514) 789,159 101,391 43,344 (2,878) (29,004) 2,160 3,602 (3,332) 46,963 (4,622) 170,327 6,364 232,924 334,315

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

15

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN INSIDE PAKISTAN Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Operating Cash Flows a) Underwriting activities Premiums received Reinsurance premiums paid Claims paid Surrenders paid Reinsurance and other recoveries received Commissions paid Commissions received Other underwriting payments Net cash flow from underwriting activities b) Other operating activities Income tax (paid) /refund General and other expenses paid Loans disbursed Loan repayments received Other receipts Net cash flow from other operating activities Total cash flow from all operating activities Investment activities Profit / return received Dividends received Investments purchased Proceeds from disposal of investments Fixed capital expenditure Proceeds from disposal of fixed assets Income received on Rent Income received on PIBS Income received on TFC Total cash flow from investing activities Financing activities Lease rentals paid Dividends paid Total cash flow from financing activities Net cash outflow from all activities Cash at the beginning of the period Cash at the end of the period 2,633,484 (1,200,390) (2,196,453) (11,380) 1,012,545 (268,670) 140,821 (188,937) (78,980) 2,313,409 (885,306) (1,310,133) (34,100) 6,985 (307,113) 105,594 (364,687) (475,351)

(23,161) (119,595) (6,277) 8,145 831 (140,057) (219,037)

(46,963) (121,355) (4,422) 7,061 1,365 (164,314) (639,665)

8,595 61,216 (594,239) 878,589 (29,294) 22,586 165 1,416 1,506 350,540

13,076 117,727 (748,654) 1,238,995 (25,769) 5,919 2,921 1,745 2,344 608,304

(22,581) (4) (22,585) 108,918 1,536,471 1,645,389

(11,362) (1,038) (12,400) (43,761) 1,240,605 1,196,844

16

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Reconciliation to Profit and Loss Account Operating cash flows Depreciation expense Provision for gratuity Other income-bank deposits Profit on disposal of fixed assets Financial charges on lease obligations Rental income (Decrease)/ Increase in assets other than cash Decrease in liabilities other than running finance (219,037) (44,822) 1 23,202 542 (3,722) 165 (1,602,513) 1,677,712 (168,472) (639,665) (42,814) 28,451 2,565 (5,348) 554 (206,760) 784,915 (78102)

Others Gain on sale of investment Amortization expense Increase in unearned premium Amortisation of income on Government Securities - net Profit on Pakistan Investment Bonds Decrease in loans Income tax paid/(refund) (Provision)/Reversal for diminution in value of investments Dividend, investment and other income Income on TFCs Profit before taxation Definition of cash:

107,238 (3,922) 252,034 998 3,991 (1,868) 23,161 (93,774) 175,054 5,974 468,886 300,414

43,344 (2,878) 80,852 2,160 3,602 (2,639) 46,963 (4,622) 170,327 6,364 343,473 265,371

Cash comprises of cash in hand, bank balances excluding Rs. 4.824 million (2010: Rs. 4.451 million) held under lien and other deposits which are readily convertible to cash and which are used in the cash management function on a day-to-day basis. Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Cash for the purposes of the Statement of Cash Flows consists of: Cash and other equivalent Cash in hand Current and other accounts Current and saving accounts Deposits maturing within 12 months Fixed and term deposits accounts Total cash and cash equivalents 6,706 1,528,276 110,407 1,645,389 2,108 491,736 703,000 1,196,844

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

17

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN OUTSIDE PAKISTAN Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Operating Cash Flows a) Underwriting activities Premiums received Reinsurance premiums paid Claims paid Surrenders paid Reinsurance and other recoveries received Commissions paid Commissions received Other underwriting payments Net cash flow from underwriting activities b) Other operating activities Income tax refund/(paid) General and other expenses paid Loans disbursed Loan repayments received Other receipts Net cash flow from other operating activities Total cash flow from all operating activities Investment activities Profit / return received Dividends received Income on Mutual Funds Investments purchased Proceeds from disposal of investments Fixed capital expenditure Proceeds from disposal of fixed assets Income received on Rent Income received on PIBS Total cash flow from investing activities Financing activities Lease rentals paid Dividend paid Total cash flow from financing activities Net cash outflow from all activities Cash at the beginning of the period Cash at the end of the period 383,070 (118,576) (323,645) (402) 84,158 (39,190) 18,787 (52,562) (48,360) 470,980 (100,645) (217,777) (658) 71,782 (60,580) 21,949 (37,307) 147,744

(9,403) (230) 899 3,333 (5,401) (53,761)

(25,421) (915) 1,608 738 (23,990) 123,754

6,710 (612) 6,098

4,453 (1,269) 3,184

(47,663) 1,163,522 1,115,859

126,938 912,048 1,038,986

18

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Reconciliation to Profit and Loss Account Operating cash flows Depreciation expense Provision for gratuity Other income-bank deposits Profit on disposal of fixed assets Financial charges on lease obligations Rental income Increase/ (Decrease) in assets other than cash Decrease in liabilities other than running finance Others Income on Mutual Funds (Loss)/Profit on sale of investments Amortization expense (Increase)/Decrease in unearned premium Amortisation of income on Government Securities - net Profit on Pakistan Investment Bonds Decrease in loans Income tax paid/(refund) Reversal for diminution in value of investments Dividend, investment and other income Deposits received Income on TFCs Profit before taxation Definition of cash: Cash comprises of cash in hand, bank balances excluding Rs.Nil (2010: Rs. Nil) held under lien and other deposits which are readily convertible to cash and which are used in the cash management function on a day- to-day basis. Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Cash for the purposes of the Statement of Cash Flows consists of: Cash and other equivalent Cash in hand Current and other accounts Current and saving accounts Deposits maturing within 12 months Fixed and term deposits accounts Total cash and cash equivalents 232 47,979 1,067,648 1,115,859 229 149,082 889,675 1,038,986 (53,761) (724) (175) 7,766 15,269 5,621 (26,004) 90,863 (669) 90,194 64,190 123,754 (762) (1,178) 5,189 48,246 4,244 179,493 (109,856) (693) (110,549) 68,944

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

19

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF PREMIUMS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Class

Premiums written

Unearned premium reserve Opening Closing

Premiums earned

Reinsurance ceded

Prepaid reinsurance premium ceded Opening Closing

Net premium revenue Reinsurance Quarter ended Quarter ended expense 31 March 2011 31 March 2010

(Rupees in thousand)

Direct and facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 2,745,629 5,017,435 4,674,538 3,088,526 883,090 1,774,525 1,553,903 1,103,712 915,790 370,327 815,956 643,556 2,745,629 1,977,580 57,988 1,760,996 1,220,871 5,017,435 1,815,920 79,373 1,683,521 1,095,724 4,674,538 1,077,450 348,942 893,431 768,703 3,088,526 548,077 49,873 93,610 191,530 883,090 1,371,210 12,199 175,330 215,786 1,774,525 1,159,559 23,836 168,339 202,169 1,553,903 759,728 38,236 100,601 205,147 1,103,712 317,722 310,706 792,830 563,556 359,775 230,742 858,140 273,535

1,984,814 1,722,192

1,984,814 1,722,192

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

20

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF PREMIUMS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN INSIDE PAKISTAN

Unearned premium reserve Opening Closing Prepaid reinsurance premium ceded Opening Closing Net premium revenue Reinsurance Quarter ended Quarter ended expense 31 March 2011 31 March 2010

Class

Premiums written

Premiums earned

Reinsurance ceded

(Rupees in thousand)

Direct and Facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 2,419,453 4,132,277 3,880,243 2,671,487 783,845 1,551,337 1,345,370 989,812 901,219 350,519 534,437 633,278 2,419,453 1,928,688 43,918 955,232 1,204,439 4,132,277 1,772,964 59,252 970,724 1,077,303 3,880,243 1,056,943 335,185 518,945 760,414 2,671,487 539,683 48,787 8,030 187,345 783,845 1,330,808 8,975 2,297 209,257 1,551,337 1,126,810 21,061 2,531 194,968 1,345,370 743,681 36,701 7,796 201,634 989,812 313,262 298,484 511,149 558,780 1,681,675 353,202 219,865 581,761 270,010 1,424,838

1,681,675 1,424,838

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

21

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF PREMIUMS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN OUTSIDE PAKISTAN

Unearned premium reserve Opening Closing Prepaid reinsurance premium ceded Opening Closing Net premium revenue Reinsurance Quarter ended Quarter ended expense 31 March 2011 31 March 2010

Class

Premiums written

Premiums earned

Reinsurance ceded

(Rupees in thousand)

Direct and Facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 326,176 885,158 794,295 417,039 99,245 223,188 208,533 113,900 303,139 297,354 14,571 19,808 281,519 10,278 326,176 48,892 14,070 805,764 16,432 885,158 42,956 20,121 712,797 18,421 794,295 20,507 13,757 374,486 8,289 417,039 8,394 1,086 85,580 4,185 99,245 40,402 3,224 173,033 6,529 223,188 32,749 2,775 165,808 7,201 208,533 16,047 1,535 92,805 3,513 113,900 4,460 12,222 281,681 4,776 303,139 6,573 10,877 276,379 3,525 297,354

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

22

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CLAIMS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Outstanding claims Class Total claims paid Opening Closing Claims expenses

Reinsurance and other recoveries received

Reinsurance and other recoveries in respect of outstanding claims Opening Closing

Reinsurance Net claims expense and other recoveries Quarter ended Quarter ended revenue 31 March 2011 31 March 2010

(Rupees in thousand)

Direct and facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 2,520,098 20,332 20,332 7,980,409 20,332 20,332 6,841,729 1,381,418 1,180,927 6,352,838 5,240,895 68,984 1,233,175 153,243 721,010 412,670 2,520,098 4,893,957 426,065 1,540,738 1,099,317 7,960,077 3,916,347 392,935 1,533,231 978,884 6,821,397 255,565 120,113 713,503 292,237 1,381,418 1,068,938 74,715 37,274 1,180,927 4,334,740 166,072 995,153 856,873 6,352,838 3,285,485 165,932 1,092,515 696,963 5,240,895 19,683 (140) 172,077 (122,636) 68,984 235,882 120,253 541,426 414,873 202,814 98,111 556,723 209,107

1,312,434 1,066,755

1,312,434 1,066,755

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

23

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CLAIMS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN INSIDE PAKISTAN

Outstanding claims Class Total claims paid Opening Closing Claims expenses Reinsurance and other recoveries received Reinsurance and other recoveries in respect of outstanding claims Opening Closing Reinsurance Net claims expense and other recoveries Quarter ended Quarter ended revenue 31 March 2011 31 March 2010

(Rupees in thousand)

Direct and Facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 2,196,453 20,332 20,332 6,889,572 20,332 20,332 5,729,789 1,036,670 1,096,769 5,433,924 4,234,473 (102,682) 1,139,352 905,671 1,224,946 152,844 409,053 409,610 2,196,453 4,888,290 414,872 468,010 1,098,068 6,869,240 3,913,940 382,080 435,503 977,934 5,709,457 250,596 120,052 376,546 289,476 1,036,670 1,061,943 34,826 1,096,769 4,329,886 166,070 81,471 856,497 5,433,924 3,283,402 165,930 88,319 696,822 4,234,473 15,459 (140) 6,848 (124,849) (102,682) 235,137 120,192 369,698 414,325 1,139,352 201,664 97,903 397,018 209,086 905,671

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

24

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF CLAIMS (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN OUTSIDE PAKISTAN

Outstanding claims Class Total claims paid Opening Closing Claims expenses Reinsurance and other recoveries received Reinsurance and other recoveries in respect of outstanding claims Opening Closing Reinsurance Net claims expense and other recoveries Quarter ended Quarter ended revenue 31 March 2011 31 March 2010

(Rupees in thousand)

Direct and Facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 323,645 1,090,837 1,111,940 344,748 84,158 918,914 1,006,422 171,666 173,082 161,084 8,229 399 311,957 3,060 323,645 5,667 11,193 1,072,728 1,249 1,090,837 2,407 10,855 1,097,728 950 1,111,940 4,969 61 336,957 2,761 344,748 6,995 74,715 2,448 84,158 4,854 2 913,682 376 918,914 2,083 2 1,004,196 141 1,006,422 4,224 165,229 2,213 171,666 745 61 171,728 548 173,082 1,150 208 159,705 21 161,084

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

25

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF EXPENSES (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Deferred commission Class Commissions paid or payable Net commission expense

Opening

Closing

Other Underwriting management expense expenses

Net underwriting expense Commission from reinsurer Quarter ended Quarter ended 31 March 2011 31 March 2010

(Rupees in thousand)

Direct and facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 304,052 512,222 490,915 325,359 291,061 616,420 194,132 422,288 423,024 145,319 44,383 88,200 26,150 304,052 259,844 11,662 162,226 78,490 512,222 259,742 5,818 165,529 59,826 490,915 145,421 50,227 84,897 44,814 325,359 48,218 46,863 110,338 85,642 291,061 193,639 97,090 195,235 130,456 616,420 119,011 1,175 16,236 57,710 194,132 74,628 95,915 178,999 72,746 422,288 95,282 80,820 199,125 47,797 423,024

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

26

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF EXPENSES (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN INSIDE PAKISTAN

Deferred commission Class Commissions paid or payable Net commission expense Other Underwriting management expense expenses Net underwriting expense Commission from reinsurers Quarter ended Quarter ended 31 March 2011 31 March 2010

Opening

Closing

(Rupees in thousand)

Direct and Facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 255,514 406,206 387,153 274,567 256,083 530,650 173,773 356,877 367,469 141,800 42,922 45,783 25,009 255,514 250,919 9,004 69,412 76,871 406,206 250,891 4,402 73,992 57,868 387,153 141,828 47,524 41,203 44,012 274,567 47,703 45,453 77,837 85,090 256,083 189,531 92,977 119,040 129,102 530,650 115,261 954 405 57,153 173,773 74,270 92,023 118,635 71,949 356,877 95,192 73,828 150,598 47,851 367,469

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

27

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF EXPENSES (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

BUSINESS UNDERWRITTEN OUTSIDE PAKISTAN

Deferred commission Class Commissions paid or payable Net commission expense Other Underwriting management expense expenses Net underwriting expense Commission from reinsurers Quarter ended Quarter ended 31 March 2011 31 March 2010

Opening

Closing

(Rupees in thousand)

Direct and Facultative Fire and property damage Marine, aviation and transport Motor Miscellaneous Total Treaty Proportional Total Grand Total 48,538 106,016 103,762 50,792 34,978 85,770 20,359 65,411 55,555 3,519 1,461 42,417 1,141 48,538 8,925 2,658 92,814 1,619 106,016 8,851 1,416 91,537 1,958 103,762 3,593 2,703 43,694 802 50,792 515 1,410 32,501 552 34,978 4,108 4,113 76,195 1,354 85,770 3,750 221 15,831 557 20,359 358 3,892 60,364 797 65,411 90 6,992 48,527 (54) 55,555

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

28

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM STATEMENT OF INVESTMENT INCOME (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Income from non-trading investments Available-for-sale Return on fixed income securities Return on Term Finance Certificates Return on Pakistan Investment Bonds Dividend income - associated undertakings - others 5,974 3,991 70,079 104,975 175,054 185,019 Gain/ (Loss) on sale of `available-for-sale' investments - associated undertakings - others 2,160 6,364 3,602 74,308 96,019 170,327 182,453

10,080 97,159 107,239 292,258

40,287 3,057 43,344 225,797

(Charge) / Reversal for impairment in value of available-for-sale' investments Net investment income

(93,774) 198,484

(4,622) 221,175

The annexed notes form an integral part of this condensed interim unconsolidated financial information.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

29

UNCONSOLIDATED CONDENSED INTERIM NOTES TO THE FINANCIAL INFORMATION (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

1.

THE COMPANY AND ITS OPERATIONS Adamjee Insurance Company Limited (the company) is a public limited company incorporated in Pakistan on September 28, 1960 under the Companies Act, 1913 (now Companies Ordinance, 1984). The company is listed on all the stock exchanges in Pakistan and is engaged in the non-life insurance business. The registered office of the company is situated at Adamjee House, I.I. Chundrigar Road, Karachi. The company also operates branches in the United Arab Emirates (UAE), the Kingdom of Saudi Arabia (KSA) and the Export Processing Zone (EPZ). The branch in the KSA has closed down its operations and is in "run-off" status with effect from 01 October 2003.

2.

BASIS OF PREPARATION This interim financial information is unaudited and is being submitted to the shareholders in accordance with the listing regulations of the Stock Exchanges and section 245 of the Companies Ordinance, 1984 and being presented in condensed form in accordance with the requirements of International Accounting Standard (IAS) - 34 'Interim Financial Reporting' and in the format prescribed by Insurance Division of SECP in its Circular No. 7 of 2003 dated August 27, 2003.This interim financial information do not include all the information and disclosures required in the financial statements, and should be read in conjection with the Company's annual published financial statements for the year ended 31 December 2010.

3.

BASIS OF MEASUREMENT This interim financial information has been prepared under the historical cost convention except that obligations under certain employee benefits are measured at present value.

4.

ACCOUNTING POLICIES AND COMPUTATION METHODS The accounting policies and methods of computation adopted in the preparation of this interim financial information are the same as those applied in the preparation of the preceding annual published financial statements of the company for the year ended 31 December 2010.

5.

CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS Judgments and estimates made by the management in the preparation of this interim financial information are the same as those applied to the preceding annual published financial statements of the company for the year ended 31 December 2010.

6. 6.1

CONTINGENCIES AND COMMITMENTS Contingencies The income tax assessments of the company have been finalized up to and including the tax year 2010. However, the company has filed appeals in respect of certain assessment years mainly on account of following: i) The Deputy Commissioner of Income Tax (DCIT) has finalized assessments for the assessment year 1999-2000 by taxing capital gains at the full rate of 33%. The aggregate tax liability assessed by the DCIT amounted to Rupees 48.205 million against which the company has made a total provision of Rupees 44.141 million resulting in a shortfall of Rupees 4.064 million. The company filed appeals with the Commissioner of Income Tax (Appeals) and Income Tax Appellate Tribunal (ITAT) which were decided against the company. Consequently the company has filed an appeal before the Honorable High Court of Sindh and the petition is fixed for regular hearing.

30

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM NOTES TO THE FINANCIAL INFORMATION (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

ii)

The Additional Commissioner / Taxation Officer has reopened assessments for the assessment years 2000-2001 and 2001-2002 by taxing bonus shares received by the company during the above mentioned periods resulting in an additional tax liability of Rupees 14.907 million. An appeal was filed before the Commissioner of Income Tax (Appeals) who cancelled the amended order passed by the Additional Commissioner and allowed relief to the company but the Tax Department had filed an appeal before the ITAT against the order of the Additional Commissioner, which has been decided in favour of the company. However, the company again received a notice from Additional Commissioner for reassessment of the case. The company has filed a constitutional petition in Sindh High Court against such order. While finalizing the assessment for the assessment year 2002-2003, DCIT has reduced the business loss for the year by Rupees 88.180 million by adjusting the dividend income against this loss. The company maintains that it is entitled to carry the gross loss forward for adjustment against the future taxable income and dividend income for the year should be taxed separately at reduced rate. The appeals of the company in this respect have been rejected by the Commissioner of Income Tax (Appeals), the ITAT and the Sindh High Court. The company has now filed a reference application with the Supreme Court of Pakistan. The management is confident that the matter will eventually be decided in favor of the company and has consequently not made any provision against the additional tax liability of Rupees 26.455 million which may arise in this respect. The Tax Authorities have also amended the assessments for tax years 2003 to 2007 on the ground that the company has not apportioned management and general administration expenses against capital gain and dividend income. The company has filed constitution petition in the High Court of Sindh against the amendment in the assessment order. The company may be liable to pay Rupees 5.881 million in the event of decision against the company, out of which Rupees 2.727 million has been provided by the company resulting in a shortfall of Rupees 3.154 million. The Taxation Officer has passed an order in the tax year 2005 and 2006 under section 221 of the Income Tax Ordinance, 2001 (the Ordinance) levying minimum tax liability aggregating to Rupees 38.358 million. An appeal had been filed before the Commissioner of Income Tax (Appeals) who upheld the order of the Taxation Officer. The Company has filed an appeal before ITAT which is pending to be heard. The Taxation Officer has passed an order under section 161/205 of the Income Tax Ordinance, 2001 in Tax year 2007 creating a demand of Rupees 1.263 million. The company filed an appeal before the Commissioner of Income Tax (Appeals) which has been decided against the company. The company is filing an appeal before the ITAT. The company received a notice from Additional Commissioner Inland Revenue pertaining to the assessment of tax year 2008. Among others, the Additional Commissioner raised issues pertaining to avoidance of tax on capital gains on listed securities. However, the company filed a constitutional petition in Sindh High Court against such order and the court has granted stay in this regard.

iii)

iv)

v)

vi)

vii)

Pending resolution of the above-mentioned appeals filed by the company, no provision has been made in these unconsolidated financial statements for the aggregate amount of Rupees 88.201 million (31 December 2010: 88.201 million) as the management is confident that the eventual outcome of the above matters will be in favour of the company. 6.2 Commitments There were no capital or other commitments as at 31 March 2011 (31 December 2010: Nil).

QUARTERLY REPORT MARCH, 2011

31

UNCONSOLIDATED CONDENSED INTERIM NOTES TO THE FINANCIAL INFORMATION (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

Note

31 March 31 December 2011 2010 ­­­­­­­(Rupees in thousand)­­­­­­

7.

INVESTMENTS In related parties Available-for-sale Marketable securities Less: Provision for impairment in value of investments 5,534,403 (2,652) 5,531,751 Investment in subsidiary - Adamjee Life Assurance Company Limited Investment in Associates - Lalpir Power Limited - Pakgen Power Limited 412,796 412,796 825,592 6,651,408 Others Available-for-sale Marketable securities Less: Provision for impairment in value of investments 2,986,891 (501,186) 2,485,705 9,137,113 2,973,083 (410,066) 2,563,017 9,406,998 412,796 412,796 825,592 6,843,981 294,065 5,724,324 5,724,324 294,065

8.

PREMIUMS DUE BUT UNPAID - Unsecured Considered good Considered doubtful Less: Provision for doubtful balances 8.1 4,298,380 208,739 4,507,119 (208,739) 4,298,380 4,546,222 199,015 4,745,237 (199,015) 4,546,222

8.1

Reconciliation of provision for doubtful balances Opening provision Exchange loss Charge for the period / year Written off during the period / year Closing provision 199,015 9,724 208,739 119,530 274 86,867 (7,656) 199,015

9.

AMOUNTS DUE FROM OTHER INSURERS/ REINSURERS - Unsecured Considered good Considered doubtful Less: Provision for doubtful balances 9.1 1,077,808 30,000 1,107,808 (30,000) 1,077,808 993,584 30,000 1,023,584 (30,000) 993,584

32

QUARTERLY REPORT MARCH, 2011

UNCONSOLIDATED CONDENSED INTERIM NOTES TO THE FINANCIAL INFORMATION (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

31 March 31 December 2011 2010 ­­­­­­­(Rupees in thousand)­­­­­­ 9.1 Reconciliation of provision for doubtful balances Opening provision Charge for the period / year Written off during the period / year Closing provision 30,000 30,000 30,000 30,000

Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ 10. 10.1 FIXED ASSETS The following capital expenditure was incurred during the period: Furniture and fixtures Motor vehicles Machinery and equipment Computer and related accessories Intangible Assets 4,227 19,468 3,172 2,704 335 29,906 21,136 3,002 1,435 1,465 27,038

10.2

The following are the written down values of fixed assets disposed off during the period: Furniture and fixtures Motor vehicles Machinery and equipment Computer and related accessories 135 6,385 187 269 6,976 105 3,026 223 3,354

11.

TRANSACTIONS WITH RELATED PARTIES The company has related party relationships with its associated company, subsidiary company, employee benefit plans, key management personnel and other parties. Transactions are entered into with such related parties for the issuance of policies to and disbursements of claims incurred by them and payments of rentals for the use of premises rented from them. There are no transactions with key management personnel other than their terms of employment. Investment in related parties have been disclosed in note 7 to the financial statements. Other transactions with related parties are summarised as follows: Quarter ended Quarter ended 31 March 2011 31 March 2010 ­­­­­­­(Rupees in thousand)­­­­­­ Premium underwritten Premium received Premium ceded Claims paid Rent paid Dividend received 239,514 147,466 1,976 976,826 4,664 Number of shares Bonus shares 2,326,228 2,740,126 231,181 167,364 350 142,425 3,005 74,308

QUARTERLY REPORT MARCH, 2011

33

12.

SEGMENT REPORTING

Each class of business has been identified as reportable segment. Class of business wise revenue and results have been disclosed in the profit and loss account prepared in accordance with the requirements of the Insurance Ordinance, 2000 and the SEC (Insurance) Rules, 2002. The following is a schedule of class of business wise assets and liabilities:

31 March 2011 Fire and Property Damage Motor Inside Pakisan (Rupees in thousand) Outside Pakisan Inside Pakisan Outside Pakisan Inside Pakisan Outside Pakisan Inside Pakisan Outside Pakisan Inside Pakisan Miscellaneous Treaty Outside Pakisan Inside Pakisan Outside Pakisan Marine, Aviation and Transport Unallocated Corporate Assets/Liabilities Total Aggregate Outside Pakisan

Inside Pakisan

OTHER INFORMATION 82,734 82,734 853,939 54,367 2,013,991 1,135,692 2,144,595 37,407 853,939 54,367 2,013,991 1,135,692 2,144,595 37,407 11,374,953 1,310,200 12,685,153 12,299,597 1,159,961 12,299,597 1,159,961 13,459,558 12,299,597 1,159,961 23,674,550 2,470,161 26,144,711

Segment assets Unallocated assets

6,362,428 -

FOR THE QUARTER ENDED 31 MARCH 2011

Total assets

6,362,428

Segment liabilities Unallocated liabilities 66,231 579,998 48,714 1,615,807 2,089,881 2,334,472 29,644 20,332

6,234,816 -

66,231 -

579,998 -

48,714 -

1,615,807 -

2,089,881 -

2,334,472 -

29,644 -

20,332 -

-

1,767,023 1,767,023

169,040

10,785,425 2,234,470 13,019,895 1,767,023 169,040 1,936,063 169,040 12,552,448 29,294 2,403,510 14,955,958 612 29,906

Total liabilities

6,234,816

Capital expenditure 31 December 2010 Fire and Property Damage Motor Inside Pakisan Outside Pakisan Inside Pakisan Outside Pakisan Inside Pakisan Outside Pakisan Marine, Aviation and Transport Miscellaneous Outside Pakisan (Rupees in thousand) Treaty Inside Pakisan Outside Pakisan Unallocated Corporate Assets/Liabilities Inside Pakisan Outside Pakisan

Total Aggregate Inside Pakisan Outside Pakisan

Inside Pakisan

OTHER INFORMATION 120,913 120,913 638,440 59,835 638,440 59,835 1,044,736 1,044,736 2,408,230 2,408,230 2,197,241 2,197,241 34,218 34,218 2,939 2,939 12,377,969 12,377,969 11,579,447 1,306,123 12,377,969 1,306,123 23,957,416 2,623,196 14,202,643 1,306,123 13,684,092 3,929,319 27,886,735

Segment assets Unallocated assets

7,696,091 -

UNCONSOLIDATED CONDENSED INTERIM NOTES TO THE FINANCIAL INFORMATION (UNAUDITED)

34

101,729 101,729 553,040 553,040 57,001 57,001

Total assets

7,696,091

Segment liabilities Unallocated liabilities

7,390,948 -

1,606,681 1,606,681

2,625,138 2,625,138

2,571,549 2,571,549

33,551 33,551

20,936 20,936

-

1,697,063 1,697,063

12,143,154 194,100 1,697,063 194,100 13,840,217 311,318

2,817,419 14,960,573 194,100 1,891,163 3,011,519 16,851,736 3,896 315,214

Total liabilities

7,390,948

QUARTERLY REPORT MARCH, 2011

Capital expenditure

UNCONSOLIDATED CONDENSED INTERIM NOTES TO THE FINANCIAL INFORMATION (UNAUDITED)

FOR THE QUARTER ENDED 31 MARCH 2011

13.

GENERAL Figures in these interim financial information have been rounded off to the nearest thousand of rupees.

14.

AUTHORISATION FOR ISSUE This interim financial information has been approved and authorised for issue on 27 April 2011 by the Board of Directors of the Company.

Umer Mansha Chairman

S.M. Jawed Director

Ibrahim Shamsi Director

Manzar Mushtaq Managing Director & Chief Executive Officer

QUARTERLY REPORT MARCH, 2011

35

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