Third quarter results for insurance intermediary
Towergate are in – with the company reporting a fall in income across insurance broking and underwriting.
Income from insurance broking for the year to date, as of the end of the third quarter, slipped by 4.5% from £167.8 million to £160.2 million, with income from underwriting also falling back, this time by 11.7% from £57.8 million in 2015 to £51.1 million this time around. Overall, income for the third quarter year-to-date fell by 6.3% to stand at £245.7 million.
Despite this, the company commented that it had stabilised underlying profitability thanks in part to reducing staff-related expenses from £141.7 million in the first nine months of last year to £131 million in the year-to-date so far.
“Towergate has reached a milestone in its recovery, with our first quarter of positive year on year growth in adjusted EBITDA since our financial restructuring,” said chief executive David Ross. “This performance has been driven by a continued improvement in underlying profitability driven by strong cost control and stabilising income.”
In a statement, the company noted that “fixing the business is well under way” with continued investment in IT and other infrastructure upgrade projects. It also highlighted that “insurance broking is making considerable headway with its turnaround plan in a number of areas”, noting an advisory panel is now in place and agreements finalised with the top six insurers which make up over 50% of the premiums.
Shortly after announcing its results, it also revealed a shake-up of its board of directors with two new non-executive arrivals - Vahe A. Dombalagian and Clive Bouch. Both appointments are subject to regulatory approval.
Dombalagian joins the Towergate Board as a representative of Madison Dearborn Partners, the company which recently invested heavily in Towergate, as reported
here. He is managing director at MDP and head of the firm’s financial and transaction services team.
Meanwhile, Bouch joins the board as an independent non-executive director and will chair the Audit Committee. He is a member of the audit committee at The Steamship Mutual Underwriting Association and chairs the audit and risk committees at Invesco UK.
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