2014 Half Year Report



Key points

  • Return on adjusted net tangible assets (annualised) before FX movements of 25.0% (HY 2013: 16.7%).
  • Profit on ordinary activities before tax, FX and IPO costs of £96.0m (HY 2013: £56.0m).
  • Profit after tax of £56.6m (HY 2013: £69.0m).
  • Gross written premiums of £701.2m (HY 2013: £671.2m), an increase of 4.5%. The increase at constant exchange rates was 11.6%.
  • Combined ratio of 88.3% (HY 2013: 86.2%).
  • Attritional claims ratio of 51.4% (HY 2013: 51.4%).
  • Investment return for the period of £56.3m representing a non-annualised return for the half year of 2.1% (HY 2013: £9.0m/0.3%).
  • Capital surplus over requirements of £336.8m with a solvency ratio of 153.5% before payment of interim dividend (FY 2013: £264.4m/141.0%).
  • Earnings per share of 14.2 pence (HY 2013: 15.9 pence).
  • Closing adjusted net tangible assets per share of 179.4 pence (FY 2013: 168.6 pence).
  • Interim dividend declared of 6.25 pence per share (HY 2013: nil).
  • Successful IPO of Brit PLC and re-domicile to the UK.

Mark Cloutier, Group CEO of Brit PLC, said:

'Brit has had a successful first half of 2014 and the business is delivering on the targets set out at the time of the IPO. The return on adjusted net tangible assets before FX of 25.0% is driven by strong underwriting and investment performances, coupled with a continued focus on strict cost control. Our attritional claims ratio for the period remained constant at 51.4%. This, coupled with a relatively benign period in terms of major losses, resulted in an excellent combined ratio of 88.3%. Investment performance has been strong, with the portfolio producing a non-annualised return of 2.1% as our income focused portfolio benefitted from falling bond yields and tightening credit spreads. The increase of 71% in profit before tax, FX movements and IPO costs to £96.0m is particularly pleasing and reflects the underlying strength of our business. I am also very pleased to announce our first interim dividend since our re-listing of 6.25p per share.

Our focus on underwriting profitability means we continue to grow premium levels where we see attractively priced opportunities and our 2013 new business initiatives are delivering profitable growth, with new teams in London, the United States, and Bermuda contributing to the Group’s increase in premium of 11.6% at constant exchange rates. This focus on profitable growth and strategic fit was the driver behind a number of further initiatives in the first half of 2014, as seen by the recruitment of a UK property team, the opening of our Miami-based Latin American Office and the acquisition of QBE’s Lloyd’s Aviation portfolio renewal rights and underwriting team. We also continue to make long-term investment in people and infrastructure to develop our business in areas which offer attractive returns.

Looking ahead, the underwriting environment is undeniably becoming increasingly challenging. However, our disciplined approach to underwriting together with our focus on optimising the risk adjusted return of our investment portfolio means we are well positioned to continue to deliver attractive returns for our shareholders.'

For further information, please contact:

Sam Dobbyn, Head of Investor Relations, Brit PLC +44 (0) 20 7984 8800
Tom Burns, Brunswick +44 (0) 20 7404 5959

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