It’s a week of interim results reports from a host of leading insurers – and as the spotlight fell on
RSA, the company certainly shined.
The insurer has revealed a 15% surge in group operating profits – totalling £360 million for the first half of the year, up from £312 million during the same period in 2016. This was also well ahead of analysts’ forecasts of £338 million. Its UK operations brought in £151 million, while Canada was responsible for £71 million and Scandinavia led the charge with £202 million. In addition, it enjoyed £222 million in group operating profits – that’s a surge of 28% compared to the prior year’s first period. All of this has prompted the firm to raise its dividend by 15%.
At the heart of the success has been a record underwriting performance with the group’s combined ratio standing at 93.2% - that compares to 94.7% one year earlier. UK operations stood at 95.4%, Canadian operations at 94.8% and Scandinavian operations at an eye-catching 81.9%.
Other highlights of its report included group premiums rising by 11% to stand at £3.4 billion although investment income of £171 million (H1 2016: £187 million) was down 9% compared to the same period last year reflecting the impact of disposals and ongoing reinvestment at lower yields.
Overall, pre-tax profit is up 78% to £263 million, prompting a positive outlook from the group’s chief executive Stephen Hester.
“RSA did well in the first half,” he said. “We delivered outperformance, showing record underwriting results, attractive earnings and dividend growth with strong return on capital. Pleasingly, customers are also growing business volumes with us.
“Across the group the focus is on making progress towards our best-in-class ambitions. And while RSA is now measuring against higher performance standards, there is much more that can be done to improve.”
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