FBD Holdings PLC FBH Interim Management Statement

  FBD Holdings PLC (FBH) - Interim Management Statement

RNS Number : 3859R
FBD Holdings PLC
19 November 2012






FBD HOLDINGS PLC

Interim Management Statement

19 November 2012



FBD  Holdings  plc  ('FBD'  or  the  'Group')  issues  the  following  Interim 
Management Statement  covering  the  period  from 1  July  2012  to  date,  in 
accordance with the reporting requirements of the EU Transparency Directive.



Overview

FBD has continued to perform strongly,  building on its first half to  deliver 
strong earnings and profit after taxation in the second half of 2012 to  date. 
The Group  has performed  ahead  of market  guidance,  primarily due  to  the 
continuation  of  the  first  half  claims  performance  in  the  underwriting 
business.



Underwriting

Gross premiums written are  marginally lower than the  previous year but  well 
ahead of the market, which contracted by  6.3% in the first six months of  the 
year. Year to date, net earned premium is marginally ahead of last year. The
Group's market  share  is estimated  to  have risen  further,  continuing  the 
progress achieved in eleven of the last twelve years.



In the second half of 2012  to date, policy volumes have declined  marginally. 
Prices in the market  for certain insurance products  have continued to  move 
lower. In  some cases,  this is  attributable to  reducing risk  as  economic 
activity declines. In other cases, this does not fully explain the  reduction 
in  premium  and,  in  these  cases,  FBD  has  maintained  its   underwriting 
discipline.



FBD continued to develop its  multi-channel distribution strategy in  response 
to customer needs.  The sales  office network  has made  further progress  in 
developing farming insurance, winning additional farm customers in the  second 
half of 2012  to date.  Our online  channels, FBD.ie  and NoNonsense.ie,  are 
attracting growing numbers of customers  from their respective target  markets 
and the  initiative  to enter  into  partnerships with  insurance  brokers  to 
increase our  penetration  of the  business  insurance market  is  progressing 
positively.



Three factors have combined to provide  a better than expected loss ratio  for 
the second  half of  2012 to  date.Firstly, the  continued implementation  of 
sustainable risk selection and  claims management initiatives, which  together 
with a positive operating environment, mean  that the favourable trend in  the 
cost of  attritional  claims continued  into  the  second half  of  the  year. 
Secondly, whereas large claims increased in the first half of the year,  they 
have been  better than  anticipated  in the  second  half to  date.  Finally, 
weather related claims in this period have been lower than expected. 



The Group continues to  focus on efficiency  and productivity improvements  to 
maintain FBD's competitive cost structure.



Financial Services

FBD's financial services businesses continued to deliver solid performances in
difficult market conditions and have proactively managed their cost structures
to reflect the economic environment. Year to date, their profit  contribution 
is ahead of both last year and expectations.



Joint Venture

Trading performance in  the property  and leisure joint  venture continued  to 
improve over  the peak  summer  period with  growth  in occupancy,  rates  and 
revenue per room, particularly in the Irish market. Year to date, the trading
performance is ahead of both last year and expectations. Sales of units in La
Cala continued to exceed  expectations and the joint  venture continued to  be 
strongly cash generative.



Profit after Taxation

The Group disposed of land underlying a secured loan at a profit of €4.4m over
its book value at 30 June  2012, thereby reducing the remaining balance  sheet 
value  of  secured  loans  to  €5.2m.  This  gain  coupled  with  a  positive 
performance  on  equity  investments  has  resulted  in  positive  short  term 
investment fluctuations  year to  date.  Profit after  taxation is  ahead  of 
expectations and last year.



Financial Position

The Group continues  to have a  strong capital  base and balance  sheet and  a 
prudent reserving strategy. The robust reserving position has been maintained
and the solvency ratio has  been further strengthened. Given the  uncertainty 
of global  investment markets,  FBD continues  to view  a low-risk  investment 
allocation, prioritising capital preservation over rate of return, as the best
strategy for  protecting the  interests of  customers and  shareholders.  The 
Board is committed to maintaining strong solvency and liquidity margins  while 
at the  same  time  continuing  to  focus on  efficient  use  of  capital  and 
delivering a superior return on equity.



Guidance

FBD Insurance will  focus on  profitable and  sustainable growth,  maintaining 
underwriting discipline  and  constantly  evolving  its  business  to  reflect 
customers'   needs.   Further   opportunities   to   maintain   FBD's    cost 
competitiveness will  be  identified  and  implemented.  The  Group  is  well 
positioned to deliver profitable growth  and superior returns to  shareholders 
in the future.



The Group is  confident that,  due to the  excellent performance  of the  core 
underwriting business, subject to exceptional events arising, it will  deliver 
full year 2012 operating earnings per share of 155 to 165 cent, an increase of
10 cent on previous guidance.







*Operating earnings per share is based on longer term rates of return.





For Reference

FBD Holdings plc                          Telephone
Andrew Langford, Group Chief Executive    +353 1 409 3208
Cathal O'Caoimh, Group Finance Director
Peter Jackson, Head of Investor Relations
Murray Consultants
Joe Murray                                +353 1 498 0300







About FBD Holdings plc ("FBD")

FBD is one of Ireland's largest  property and casualty insurers looking  after 
the insurance needs of farmers, private individuals and business owners.



The following details relate to FBD's ordinary shares of €0.60 each which  are 
publicly traded:



Listing          Irish Stock Exchange   UK Listing Authority
Listing Category Dual                   Premium (Equity)
Trading Venue    Irish Stock Exchange   London Stock Exchange
Market           Main Securities Market Main Market
ISIN             IE0003290289           IE0003290289
Ticker           EG7.IR and FBD.I       FBH.L





Forward Looking Statements

Some statements  in this  announcement  are forward-looking.  They  represent 
expectations for the  Group's business, and  involve risks and  uncertainties. 
These forward-looking  statements  are  based  on  current  expectations  and 
projections about future events. The Group believes that current expectations
and  assumptions  with  respect   to  these  forward-looking  statements   are 
reasonable.  However,  because   they  involve  known   and  unknown   risks, 
uncertainties and other factors,  which are in some  cases beyond the  Group's 
control, actual  results  or performance,  may  differ materially  from  those 
expressed or implied by such forward-looking statements.



  FBD Holdings plc, FBD House, Bluebell, Dublin 12

Registered in Dublin, Ireland Registered Number 135882



                     This information is provided by RNS
           The company news service from the London Stock Exchange

END


IMSLLFFDLDLRLIF -0- Nov/19/2012 07:00 GMT
 
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