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Beazley Says Profit Fell 28% as Investment Returns Decline

Beazley Plc (BEZ), a Lloyd’s of London insurer, posted a 28 percent fall in first-half profit as returns from bond investments declined.

Net income fell to $72.1 million in the six months to June 30 compared with $100.1 million in the year-earlier period, the Dublin-based company said in a statement today. Net investment income fell to $300,000, from $36.1 million, Beazley said.

“The last six weeks of the half were marked by significant rises in U.S. interest rates,” Beazley said in the statement. “The rise in rates created mark-to-market losses in the fixed-income portfolio that canceled out the profits we had made earlier in the year.”

Beazley said further rises in U.S. interest rates will “suppress” earnings from investments. The company raised its first-half dividend by 7.4 percent to 2.9 pence a share in line with its strategy of increasing the payment by 5 percent to 10 percent.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net

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