Admiral keeps profits on track
Filed under: News
The company, which is the second largest insurer in the UK with 2.9 million customers, reported pre-tax profits of £171.8 million in the six months to June 30 as it grew the number of vehicles on its books by 11% to 3.5 million.
It has seen claims trends improve since the fourth quarter of 2011 in a welcome respite for the group after it was hit hard by a rising tide of bodily-injury claims.
The half-year figures mean that 6,500 staff will pocket another shares windfall, following £3,000 each after the 2011 results.
Cardiff-based Admiral - owner of Elephant, Bell and the comparison website Confused.com - has resisted being dragged into a price war in an effort to protect its margins, pricing its premiums less competitively and slowing the rate at which it won new customers.
The group said UK premiums were 5% higher on a year earlier. But it confirmed the loss of fees worth around £7 a vehicle when referral fees for passing on details to lawyers are due to be banned in April.
Admiral added its price comparison website Confused.com had a "positive" first half and maintained its market share, despite intense competition among the four dominant players.
Confused's operating profits grew 2% to £8.4 million after a 7% hike in total revenues to £43.2 million was offset by advertising spend.
Nick Johnson, analyst at Numis Securities, said: "For the time being we expect UK customer growth to flat-line and margin pressure is also likely if the more competitive rate environment continues."
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