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Link4 - Financial Performance for Q1 2008
In the first quarter of 2008, written premiums amounted to PLN 59.2 million and were by nearly 20% higher than in Q1 2007. The customer base of the Company grows continuously – in the first quarter by 24% as compared with the previous quarter. In connection with legislative changes that have increased the risk of higher indemnities, the Company decided to take a more conservative approach to estimating technical reserves as soon as in the first quarter of 2008. This was the key reason behind a negative technical result of the Company after the first quarter, despite an excellent sales result.
June 25, 2008 Warsaw,
The Company constantly invests to develop its operations, as well as the operations of Link4 Life. In the scope of capital expenditures at the non-life company, it was assessed that both effective service of the still growing customer base and maintenance of quality and security of service of that portfolio required a further upgrade of the existing logistics and technical infrastructure, as well as its expansion by a new call centre, which became operational in Katowice in the end of May (and was opened officially on June 16). The above project and capex for the life insurance business, where Link4 TU S.A. is the main shareholder, caused that Link4 ended the first quarter of 2008 with a net loss of 14.5 million.
“Link4 is still the leader in the direct insurance segment in Poland. However as leader, we cannot feel released from the obligation to search for, initiate and implement new projects, in the area of both products and organizational or structural solutions. New solutions we have implemented are our response to increasing needs of our customers, but also to dynamic changes in the insurance market. A good example can be both the development of our life insurance vehicle – Link4 Life and our capex project in the Silesian Region – i.e. the new call centre and customer service outlet in Katowice. Development costs are an obvious consequence of our growth, and are included in the operating plan for this year. In addition, we will use resources and know-how of one of our owners, a leading insurance group in the U.K. insurance market: Royal&Sun Alliance,” said Mr. Arkadiusz Lew-Kiedrowski, President of the Management Board of Link4 TU SA.
The capital commitment of the shareholders of Link4 exceeded PLN 175 million in the first quarter, while the total assets of the Company rose to PLN 293.8 million as compared with PLN 229.9 as of March 31, 2007.
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