Motor insurer Admiral (ADM) reckons 2013 was a "baked potato year" - that is, its performance was wholesome but unglamourous. Judging by the 7 per cent share price jump on the back of the figures, Admiral may have grabbed a tad more attention than it expected.
There was certainly good news. Profits beat analysts' expectations; overseas expansion helped the number of cars insured to rise 4 per cent to 3.7m; and the combined ratio (of claims to premium) improved by over nine percentage points to a very profitable 81 per cent. That's impressive given that new business premium rates in Admiral's UK motor division have tumbled 26 per cent in the past two years. The improvement reflects more reserve releases, but also a determination to avoid "chasing the UK motor market to the bottom", said chief executive Henry Engelhardt. Such selectiveness, however, meant UK net motor premiums fell 7 per cent and that the number of UK cars insured remained flat at 3.02m.
Analysts at Berenberg expect EPS of 94.1p for 2014 (104.4p in 2013).
ADMIRAL (ADM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,524p | MARKET VALUE: | £4.21bn | |
| TOUCH: | 1,524-1,525p | 12-MONTH HIGH: | 1,526p | LOW: 1,172p |
| DIVIDEND YIELD: | 3.1%† | PE RATIO: | 15 | |
| NET ASSET VALUE: | 187p | COMBINED RATIO: | 81% | |
| Year to 31 Dec | Net premiums (£bn) | Pre-tax profit (£m) | Investment income (£m) | Dividend per share (p)† |
|---|---|---|---|---|
| 2009 | 212 | 216 | 8.8 | 26.5 |
| 2010 | 288 | 266 | 9.5 | 32.4 |
| 2011 | 446 | 299 | 13.7 | 36.9 |
| 2012 | 499 | 345 | 15.9 | 42.7 |
| 2013 | 483 | 370 | 14.3 | 46.9 |
| % change | -3 | +7 | -10 | +10 |
Ex-div: 30 Apr Payment: 30 May †Excludes special dividends: 31p in 2009, 35.7p in 2010, 38.7p in 2011, 47.9p in 2012 and 52.6p in 2013 | ||||
