Recent catastrophe events - such as Canadian flooding and US tornadoes - have boosted the insurance sector's claims of late, but Lloyd’s insurer Novae (NVA) hasn’t suffered much. Indeed, Novae’s claims from these events reached just £5.6m at the half-year stage and its combined ratio (of claims to premiums) improved by 1.6 percentage points to a solidly profitable 91.6 per cent.
Premium rates, however, were largely flat - Novae’s renewal rates, for example, were unchanged in the period, compared with a 1 per cent rise during 2012’s fist half. There were modest rate increases in the group’s property book, notably in the US. While Novae’s marine classes demonstrated some rating improvement at the start of the year, following losses from Superstorm Sandy and the Costa Concordia cruise ship disaster. But such hardening has been offset by rate pressure elsewhere - such as in the US property reinsurance book.
The investment book, meanwhile, remains largely focused on cash and safe-looking bonds - although the return here fell to 0.4 per cent from last year’s 1.1 per cent.
Prior to these figures, broker Numis Securities was expecting full-year pre-tax profit of £38.1m, giving EPS of 46.5p (2012: £39.9m/43p) and net tangible assets of 490p.
NOVAE (NVA) | ||||
|---|---|---|---|---|
| ORD PRICE: | 505p | MARKET VALUE: | £325m | |
| TOUCH: | 496-517p | 12-MONTH HIGH: | 513p | LOW: 343p |
| DIVIDEND YIELD: | 4.1% | PE RATIO: | 9 | |
| NET ASSET VALUE: | 464p | COMBINED RATIO: | 91.6% | |
| Half-year to 30 Jun | Net premiums (£m) | Pre-tax profit (£m) | Investment income (£m) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 263 | 12.5 | 13.4 | 5.50 |
| 2013 | 250 | 21.1 | 4.40 | 6.00 |
| % change | -5 | +69 | -67 | +9 |
Ex-div:04 Sep Payment:02 Oct Capacity owned: 100% | ||||
