MILLI RE 2020 ANNUAL REPORT

Activities and Major Developments Related to Activities General Information Financial Rights Provided to the Members of the Governing Body and Senior Executives Research & Development Activities 72 Milli Re Annual Report 2020 2020 Financial Results Investment Expenses There was a slight increase in the Loss from Disposal of Financial Assets due to the disposal of fund shares predominantly constituted by share certificates since greater weight was given to funds backed by fixed‑income securities. While depreciation costs increased upon the reinsurance software’s going live, other investment expenses declined in conjunction with the decreased income subject to expenditure tax. During the current period, foreign exchange losses decrease due to the increase of exchange rates. (TL) 2020 2019 Change (%) Investment Expenses (368,475,610) (403,360,732) (8.65) Investment Management Expenses – (Incl. Interest) (78,988) (44,377) 77.99 Loss from Disposal of Financial Assets (1,586,173) (1,345,499) 17.89 Investment Income Transferred to Non‑life Technical Account (316,455,994) (348,001,715) (9.06) Foreign Exchange Losses (20,493,502) (31,632,288) (35.21) Depreciation and Amortization Expenses (16,136,886) (4,170,943) 286.89 Other Investment Expenses (13,724,067) (18,165,910) (24.45) Income and Expenses from Other and Extraordinary Operations While a higher amount of deferred tax income was generated under the Income and Expenses from Other and Extraordinary Operations item because of the weighted impact of the rise in equalization reserve, unexpired risk reserves and additional fund deficit reserves, deferred tax income declined due to the reversals in the previous period. On the other hand, the rise in the additional fund deficit reserves as compared to the previous year negatively affected the reserves account. (TL) 2020 2019 Change (%) Income and Expenses From Other and Extraordinary Operations (1,457,582) (6,850,022) (121.28) Provisions (21,990,214) (13,080,686) (68.11) Rediscounts 495,757 (299,165) + Deferred Taxation (Deferred Tax Assets) 7,274,347 9,740,590 (25.32) Other Income 12,788,554 10,607,605 20.56 Other Expenses and Losses (26,026) (118,322) (78.00) Corporate Tax Liability Provision on Period Profit The decrease in the corporate tax liability provision basically stems from the increased disallowable income although the taxable income in the current period was higher compared to the previous period. As a result, the Company posted a net profit of TL 348,598,908 in 2020.