CARDIFF (dpa-AFX) - Shares of Admiral Group Plc (ADM.L) climbed around 7 percent in the morning trade in London after the motor insurance provider reported Wednesday a higher profit in its fiscal year 2013, and also announced a hike in dividend.
Group Chief Executive Officer Henry Engelhardt said, '2013 was the year of the baked potato. It was a good, solid year, something on the plate that is appreciated but doesn't really grab the spotlight. This is a comfort food set of results... .We made more money than ever before, we grew customer numbers a little bit, we launched one new overseas business (comparenow.com), but there was no growth surge, there were no claims shocks; we just went about our business.'
For the year, pre-tax profit increased 7 percent to 370 million pounds from 345 million pounds a year ago. Earnings per share grew to 104.4 pence from last year's 94.9 pence.
The company's UK Car Insurance business, which remains the main source of profits, recorded a 6 percent increase in profit, while International Car Insurance business generated losses in the quarter. Price Comparison businesses in the UK, Spain and France generated 13 percent increase in annual profit.
Group turnover declined 8 percent to 2.03 billion pounds from 2.22 billion pounds a year ago. Group vehicle count was up 4 percent to 3.70 million from 3.55 million in 2012.
Insurance premium revenue dropped to 1.136 billion pounds from 1.157 billion pounds last year. Net insurance premium revenue declined to 483 million pounds from 498.9 million pounds a year ago. Net revenue was 924.4 million pounds, compared to 984.3 million pounds last year.
In the year, UK turnover of 1.70 billion decreased 12 percent, primarily due to reductions in average premiums which led to a 11 percent reduction in total premiums written. The closing vehicle count was stable at 3.02 million.
The company noted that UK Car Insurance business accounts for 84 percent of total turnover, lower than last year's 87 percent in the face of very strong competition. In the UK market, the business continued to focus on margin rather than growth and held the number of vehicles insured steady at just over three million, the company said.
Further, the company said its Directors have proposed a final dividend of 50.6 pence per share, comprising 24.4 pence normal and 26.2 pence special, to be paid on May 30. This brings the 2013 total dividend to 99.5 pence per share, up 10 percent from last year.
In London, Admiral shares are currently trading at 1,512 pence, up 93 pence or 6.55 percent.
Copyright RTT News/dpa-AFX