Amlin is digesting its recent €350m (£329m) purchase of Fortis's corporate property and casualty insurance arm from the Dutch state, which took control of the business as part of last autumn's bail-out of the bank. Renamed ACI, the acquisition looks a timely move now that insurance rates have started to pick up.
The group's first-half results were also encouraging, helped by a sharp recovery in investment return, as global financial markets bounced strongly in the second quarter. Underwriting results were strong, too, thanks to the low level of natural catastrophe losses and Amlin's low level of exposure to those that occurred, apart from the Italian earthquake in April, and to the other large industry losses in aviation and marine piracy. This more than offset a heavy currency penalty from sterling weakness.
Prospects look good with rates remaining high in catastrophe reinsurance and signs of a pick-up in property, casualty and a hardening in UK fleet motor rates. And following several airline disasters this year, including the loss of an Air France jet en route from Rio de Janeiro to Paris, aviation rates could get a boost. At any rate, Amlin says the third quarter has started well with a strong level of reinsurance renewals in July. So RBS has lifted its full-year pre-tax profits forecast from £226m to £275m, with estimated net tangible assets (NTA) of 256p.
AMLIN (AML) | ||||
|---|---|---|---|---|
| ORD PRICE: | 362p | MARKET VALUE: | £1.79bn | |
| TOUCH: | 361-362p | 12-MONTH HIGH: | 394p | LOW: 266p |
| DIVIDEND YIELD: | 4.8% | PE RATIO: | 12 | |
| NET ASSET VALUE: | 263p | CAPACITY OWNED: | 100% | |
| COMBINED RATIO: | 73% | |||
| Half-year to 30 Jun | Net premiums written (£m) | Pre-tax profit (£m) | Investment income (£m) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 446 | 137 | 22.5 | 6.0 |
| 2009 | 510 | 177 | 53.1 | 6.5 |
| % change | +14 | +29 | +136 | +8 |
Ex-div: 9 Sep Payment: 8 Oct | ||||
