Hello. Welcome to Anadolu Sigorta Second Quarter 2025 Financial Results Webcast. Today, we are going to be making the presentation with our CFO, Erdem Bey, as usual. Erdem Bey is going to start the presentation with technical results, and I will be following with financial figures after Erdem Bey. I would like to thank you for your participation in advance. Erdem Bey, the floor is yours.
Thank you, Barış. Sorry about it. Okay. Welcome to Anadolu Sigorta financial presentation of 2025 second quarter. My name is Erdem Esenkaya. Our presentation has 17 slides, and eight of them I will present to you. After that, my colleague, Mr. Şafak, will present next slides. I think that it will take nearly 30 minutes. If there is any question, we will pleasure to answer it. At the beginning, I would like to give short notice about the last six months for only refreshment of the mind, I mean. One important thing that was happened in this term, decrease of discount rate from 35% to 32.5%. This 250 basis decreasing effect, was nearly TRY 750 million on our financial statement negatively.
Secondly important thing that was happening this term in Turkish lira lost value against the foreign currencies, especially in the middle of the March term. Following attention on March 19, there was a major loss in Borsa Istanbul index. Its meeting on March 16, the monetary policy committee had lowered the interest rate by 250 basis points to 42.5%. But after that this happen, it increased the 42% in April and increased the overnight lending rate from 46% to 49% in this term. On the other hand, our company general assembly met in March and decided to TRY 2.1 billion dividend and increase the paid capital TRY 500 million to TRY 2 billion with free stock. Again, in this term, two insurance companies were seized by SEDDK, Insurance Regulation and Supervision Agency, in this term. Again, SEDDK regulated about MTPL production.
I mean, the MTPL depended on MOD 70% in this term. After that in our presentation, slide please. Okay. First of all, we would like to give you information about highlights and profitability. Real growth when we look at Anadolu Sigorta in the first six months, premium volume is at strong increase, TRY 44.5 billion, nearly 41% year-to-year increase. The inflation rate end of the June, 25% in this term. Real profitability, especially the trailing 12 months solo ROE, 36.4% consolidated, nearly 50% in this term. When we look at the technical outlook, technical profitability, it supports overall profitability. Quarterly claims ratio improved 3.4 points, down to nearly 78%. Quarterly combined ratio improved 1.9%, down to nearly 109%.
When we look at the assets under management, AUM grows significantly by TRY 5.4 billion quarterly, reaching TRY 64 billion in this term. Of course, the tight monetary stance continues to support investment income in this term. When we look at the non-life insurance market and totally nearly 60 insurance companies in this sector, Anadolu Sigorta in the first half produced TRY 44.4 billion or TRY 44.5 billion premium production. When we compare to last year, it increased 41%. We have got third degree or the third rank in the sector. If you look at the five companies, they produced TRY 237 billion. When we look at the 10 companies, TRY 38 billion, and totally sector premium production TRY 498 billion. When we look at if you compare the last year, yes, thank you. I would like to take attention this point.
If we look at the first five companies, they produced nearly 50% of the total sector premium. But when we look at in this term, it is 48.5% or 49% of the total premium. Again, when we look at the top 10 companies, they produced the total premium, 60% last year, but this year it was 58%- 59%. I mean, 1 % or 2 %, slightly than out of 10 companies, and they went in production to middle and small size insurance companies in the sector. It shows a kind of aggressive pricing in this term. Next slide, please. When we look at the premium volume and composition, we have got TRY 44.5, nearly TRY 45 billion premium production and 41% increase if you compare the last year. When we look at the sector, there was the TRY 498 billion and nearly 48% increase.
MTPL site, we are lower than the sector, but especially the health site is higher than the sectors in this cycle, I can say. We compare the Anadolu Sigorta and sector premium production composition. In motor site, 37%, but in sector, 42%. The fire site in Anadolu Sigorta, 20%. When we look at the sector, 18%. The health site, we have got 23%, and the sector, 22%, something like that, the composition. Next slide, please. When we look at the market share and rank in this term, we have got 13 different branches, and we have got first degree in the third branches, MOD, watercraft, and transportation. We have got second degree in the aircraft liability, accident, and general liability. We have got third rank, fire, general laws, and health.
Totally, we have got third degree and 8.9% market share in this term. Next slide, please. When we look at the sales channels, as I said before, we have got agency, tendency, insurance companies. If you compare the sector, we are higher than the sector. When we look at the sector, it was 59% in premium production in sector. When we look at the Anadolu Sigorta, you can see easily 62% increase, and if you compare the last year in the Anadolu Sigorta again, 2 point increase the agency production. On the other hand, the bancassurance site is very important for all company. If you compare the last year, we have got lesser than the 1 point, I mean the 13%. But if you compare the sector, 12%, and 1 point higher than the sector.
If you compare the broker side, we have 16%, and the sector, 18%. The other side, we have 9%, and the sector, 11%. When we look at the branch outlook and the total portfolio Q-on-Q improvement, especially if you look at the end of 2024, especially the fourth quarter 2024, it was 112.1%. After that, 110.7% and 108.7%. This is a good, slightly decreasing in this term, and it is good, of course, positive effect our financial statement. When we look at the MOD side, a strong profitability we can see there. Fourth quarter of 2024, it was 86.8%, and after that, it was 76.7%, and end of the second quarter, 87.2% in this term. Of course, especially it depends on the discount rate changing at the beginning of the year.
The MTPL side, Q-on-Q, the positive improvement is very good for us, especially at end of the year and fourth quarter, it was 139%. After that, it increased 151.7%, and now end of the second quarter, 131.2%. Of course, this is the highest percentage, but if you compare the last year and especially the last quarter and the end of the year, it is a good improvement for the combined ratio side for us. Fire and natural disaster side, when we look at end of the year, fourth quarter, it was 117.3% combined ratio. End of the first quarter, 131.1%. End of the second quarter, it was 115.4%.
Here, if you compare the 2025 first quarter, there is increasing but totally when we look at if you compare the last year and first quarter of 2025, it is a good improvement for us. The health side is very important and strategic production side for us. It was end of the year, 144.4%. End of the first quarter, 114.6%. End of the second quarter, 102.4% in this term. Profitability level is good for us generally. Next slide, please. As you see, the combined ratio is increased. 8.7 point discount rate affecting yearly seven points in this term, especially first half I am talking about. When we look at the financial status and activity results of our company are exempt. It is in our assets exceeded TRY 111 billion, with an increase of nearly 37% compared to previous year.
Premium production, as I said before, reached TRY 44.5 billion, with an increase 41% compared to previous year. Our market share, 8.9% in this term. Our company realized TRY 5.2 billion in unconsolidated net profit in this term. When we look at the technical profitability side, especially end of the first half of 2024, it was 73.1%, and it increased to 79.5¨%. Mostly it depends on the discount rate changing in this term. Combined ratio, when we look at 101.2% in 2024, and in 2025, 109.6% in this term. As I said before, the discount rate changing in this term, and last year at the same term, discount rate increased. This term is decreased. So both of them, they affect our comparable discount rate changing and claims ratio and combined ratio together, they increased.
Now I would like to give [sentence] to my colleague, Mr. Şafak. Thank you.
Thank you, Erdem Bey. I am going to start with investment portfolio breakdown. As you see on the screen, we have reached TRY 64 billion at the end of second quarter. Our AUM portfolio has significantly increased. The breakdown is also seen on the slide. We have invested most of our portfolio to short-term interest instruments. The portion is 56%. We have 24% bonds, both TL Euro bonds. 57% of these bonds are TL bonds, and most of them are fixed income bonds. We have also some Euro bond and USD and Euro bonds as well in our bonds portfolio. 12% equity consists of both direct stock investments and also stock fund investments as well. We have commodity and venture capital investment as well. Its portion is 2%. On the left-hand side, you see 7% hedge fund investment as well.
As of 1st half results, our investment income reached TRY 29.5 billion . Anadolu Hayat dividend income is excluded, which makes 17% portfolio return in first six months of the year. On the next slide, you can see our income statement, quarterly income statement. Standalone quarters can be seen on this slide. On the left-hand side are unconsolidated figures, and on the right-hand side, consolidated figures are placed. At second quarter, our net profits stood at TRY 2.9 billion- TRY, 3 billion . In the first quarter, our net profit was TRY 2.2 billion, and last year's second quarter was TRY 2.5 billion . So in Q-on-Q, increase was 31%, and year-on-year increase was 15% in our unconsolidated figures. Consolidated figures, when we look at our consolidated figures, our second quarter consolidated income was TRY 3.2 billion .
First quarter consolidated net income was TRY 2 billion, and last year's second quarter net income was TRY 2.8 billion . So the Q-on-Q increase was 64%, and year-on-year increase was 15% for our consolidated standalone quarterly result figures. On the next slide, we have our cumulative six-month income figures. As you might recall, our last year six months results was TRY 5.4 billion for our unconsolidated income, and consolidated income was TRY 5.7 billion . This year's consolidated income stood at TRY 5.2 billion . This cumulative comparison of our unconsolidated and consolidated figures is a bit below than our last year's financial results. 4% below for unconsolidated net profit and 8% below for consolidated profit can be seen on the slide. On the next page, our balance sheet, some figures can be seen. On the left-hand side, our total assets trends can be seen.
In the first half of the year, our total assets grew 16%, reached TRY 112 billion. Our AUM also increased similarly, 15% increase occurred in first half of the year, and our AUM stood at TRY 64 billion, as I have just said in the previous slide. Our technical reserves, they are mainly outstanding claim reserves and unearned premium reserves. Total of them is TRY 62 billion, with an increase of 21% in the first half. Lastly, our shareholders' equity can be seen on the right-hand side of the page. The increase was slightly below than other figures. It was 2.8% in the first half, mainly due to weaker performance of Anadolu Hayat stock price and also the dividends that we had distributed in the first quarter, as you might recall. On the next slide, our net profit breakdown for our non-technical side can be seen.
As you might recall, our net profit on technical side stood at TRY -2.7 billion. When we deep dive in our non-technical side, we had investments income around TRY 9.4 billion. The loss coming from amortization and depreciation was TRY 100 million. We had some provisions, mainly due to recoveries. It was TRY -428 million. The discount coming from our payables was plus, positive TRY 230 million, and the net tax effect on our P&L was TRY -1.2 billion. We can reach to TRY 5.2 billion at the bottom line. On the next slide, you can see the comparison between our last year's six months figures and this year's six months figures. The waterfall graph shows that our underwriting performance was worse than last year's. We lost TRY 2.5 billion from our underwriting performance. Our investment performance was higher than last year's, with TRY 1.1 billion.
Tax was also lower than previous year. Dividend that we get from Anadolu Hayat is higher, TRY 300 million higher than last year's. Other items also was higher than last year with TRY 400 million. At the end of the graph, you can see our net profit coming to TRY 5.2 billion. On the next slide, this is our last slide, actually. Our return on equity chart can be seen. On the right-hand side, you see our six months, trailing 12 months ROE, return on average equity, I may say, actually. Yes, we had a peak in 2023, but still our return on equity is relatively high. For unconsolidated figures, it's 36%, and consolidated figures, it's 50% , and consolidated ROE stands at 50%. This was our last page. As I mentioned, thank you for listening to us. We can have the Q&A session.
If you have any questions, you can write to our chat box or you can raise your hand so we can unmute your microphone. Thanks for listening to our second quarter result presentation. We don't have any written questions as far as I see. Are there anyone that like to ask their questions verbally?
I think we explained everything very clearly. There's no question.
All crystal clear. Yes, Erdem Bey. Back to you for the closer please, Erdem Bey.
Okay. Thank you very much for joining our presentation. We would like to see you the next presentation again. Thank you very much. Have a good day for you. Bye.
Bye.