Hastings (HSTG) has shown growth that is little short of meteoric in what is a highly competitive vehicle insurance business. So, a sharp drop in the share price may have more to do with the announcement that both the chairman and chief executive are being replaced, although in the case of chief executive Gary Hoffman, he is set to be the new chairman.
Despite the competitive environment, Hastings continues to increase its market share, now up to 7.3 per cent. The core driver remains private car insurance where gross written premiums rose from £733.9m to £888.1m. And with no repeat of the provisions made a year earlier in respect of changes to the Ogden rate used to calculate claims compensation, together with higher earned premiums, the accident year loss ratio fell from 76.6 per cent to 73.8 per cent.
While still very small, written premiums on home insurance rose by nearly a third, and Hastings’ own underwriting business started writing home insurance, having gained experience by being a secondary insurer in co-insurance agreements.
Meanwhile, the group’s underwriting business Advantage Insurance Company Limited was granted permission by the Gibraltar authorities to use certain parameters when calculating its solvency requirements, which helped to boost its solvency ratio from 140 per cent to 167 per cent.
| HASTINGS (HSTG) | ||||
| ORD PRICE: | 291p | MARKET VALUE: | £ 1.91bn | |
| TOUCH: | 291-291.8p | 12-MONTH HIGH: | 337p | LOW: 226p |
| DIVIDEND YIELD: | 4.3% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 93p* | COMBINED RATIO: | 87% | |
| Year to 31 Dec | Gross premiums (£m) | Pre-tax profit (£m) | Investment return (£m) | Dividend per share (p) |
| 2013** | 407 | 56.0 | 4.2 | nil |
| 2014** | 475 | -1.4 | 3.7 | nil |
| 2015 | 615 | 5.0 | 5.3 | 2.2 |
| 2016 | 769 | 94.3 | 7.2 | 9.9 |
| 2017 | 931 | 149 | 7.2 | 12.6 |
| % change | +21 | +58 | - | +27 |
| Ex-div: | 03 May | |||
| Payment: | 31 May | |||
| *Includes intangible assets of £470m, or 71p a share ** Pre-IPO figures | ||||
