Net profit of United Insurance Company (UNIC), one of the oldest insurance firms, fell by 14pc to 106.6 million Br in the last financial year. Earnings per share also dropped by 167 Br.

The decline is due to last year’s one time profit increase from the firm selling its share in Raya Brewery, according to Mulualem Birhane, board chairperson of UNIC.

The preceding year’s profit was inflated mainly due to a gain on disposal of equity investment amounting to 54 million Br, the revenue generated after the company sold the shares it had in Raya Brewery to BGI Ethiopia.

Excluding the gain on disposal of equity investments, the performance of UNIC has shown improvements, according to Abdulmenan Mohammed, a financial statement analyst with close to two decades of experience.

Underwriting income of the insurance firm has increased by 44pc to 173.5 million Br. UNIC's gross written premiums also reached 533.6 million Br, showing a 13pc increase.

"This is a reasonable increase," said Abdulmenan.

Out of the total written premium, the company retained 23pc of it, spotting a small reduction, and transferred the remainder to reinsurers.

The net claims UNIC paid to clients also declined by seven percent to 226.9 million Br.

"The reduction had contributed to improved performance of United's main area of business," said Abdulmenan.

In the reported period, UNIC worked on claim management, according to Meseret Bezabih, CEO of the company.

"We've identified policies with risk, and we adjusted premiums," she told Fortune.

Direct expenses of the firm have also spiked by 5.4pc to 27.3 million Br, while the commissions it earned from reinsurers slightly dropped by two percent to 32.9 million Br.

Revenues from investment activities have positively contributed to the firm's profitability. Interest on savings increased by 30pc to 46.1 million Br, while dividend income went up by 36pc to 14.8 million Br. The company's revenue from rent also increased by 69pc to 17.2 million Br.

United put a considerable amount of its resources into income-generating investments. It invested 397.2 million Br in time deposits, an increase of 19pc, and 298.3 million Br in investment property, an increase of 66.9pc. It also invested 134.9 million Br in shares.

“The management should be appreciated for this," Abdulmenan said.

The revenue increase of the company is accompanied by expense expansion. It's expenses rose by 32pc to 137.2 million Br.