Despite a notable improvement in profitability, the earnings per share (EPS) of Oromia Insurance saw a marked decline in the last fiscal year.

The company’s profit after tax went up by 20pc to 87.3 million Br, while the EPS slid by 20 Br to 390 Br, undermined by a marked increase in paid-up capital.

The capital was raised to ensure the company's competitive advantage in the industry and for increased reinsurance coverage, according to Asfaw Benti, the CEO of Oromia, whose branch network reached 47 including six contact offices in the last fiscal year.

Oromia raised its paid-up capital to 250 million Br, an increase of 27pc.

The paid-up capital of the company was raised based on the decisions of the shareholders, according to Aberra Bekele, the chairperson of the board of directors of Oromia.

"The shareholders even agreed to double the capital to half a billion Br in the coming year," he told Fortune.

The reasonable increases made in all income activities helped the company to raise its profit. Oromia registered a 13pc increase in the total gross written premium both for life and general that reached 452.4 million Br. The company also ceded 75.7 million Br of the gross premium to reinsurers, helping the retention rate rise by a percentage point to 83.3pc, above the industry average of 79.4pc.

Against the increased retention rate and the growth in gross written premium, claims paid and provided both for life and general insurance increased reasonably by 11pc to 202.9 million Br.

This shows that claims were well-controlled, according to Abdulmenan Mohammed, a financial statement analyst with close to two decades of experience.

"The management should keep this practice,” remarked Abdulmenan.

Oromia’s income has also expanded considerably. Its commission from reinsurers increased by 13pc to more than 23 million Br, whereas it paid 8.3 million Br in commission to agents, which was five percent less than the previous year.

Sound investment activities Oromia made in the last fiscal year resulted in a 15pc increase in earned interest on deposits and a 208pc spike in dividend payouts that reached 57.2  million Br, and 7.7 million Br, respectively.