Chief executive hopes for even better performance after 11% profit rise
Lloyd’s insurer Brit is hoping to better its 2012 performance this year following an 11% increase in net profit, said chief executive Mark Cloutier.
Speaking to Insurance Times following the release of Brit’s 2012 results, Cloutier said: “Given the direction of travel in the business and the growth opportunities we are already seeing, our hopes are to beat these returns in 2013.”
He added: “Our intention for the business is to continue to improve returns and start to grow the top line of the business carefully.”
Brit made a 2012 net profit after tax of £84.7m, up 11% on the £76m profit it made in 2011.
Excluding the £8.3m loss from discontinued operations – the non-core UK business Brit sold last year – the profit was £93m, up 65% on 2011’s £56.3m.
The combined ratio improved 6.4 percentage points to 93.2% (2011: 99.6%). The improvement came despite Superstorm Sandy, which Clouter said “cost us all of our catastrophe margin and a little bit more”.
Also, reserve releases only contributed 1.7 percentage points to the 2012 combined ratio.
Brit reported a return on net tangible assets of 16.8% (2011: 8.6%).
2012 was a year of change for Brit. It sold the renewal rights for its UK regional insurance business to QBE in April and sold the old liabilities from that business to run-off buyer RiverStone in June.
It also restructured itself to become a solely Lloyd’s-based underwriter.
Cloutier said: “We are substantially done with the restructuring of the business. We are going to focus on opportunistic, profitable growth. We think the business is poised to be able to grow quite nicely now.”
He added: We’ll always be focusing on expenses and there will be a little trimming here and there around expenses but that’s more fine tuning.”
While the exited UK business reduced Brit’s 2012 profits by £8.3m, which comprised the unit’s operating loss before sale and a write-down of its intangible assets, Cloutier said the unit would not drag down future results.
He commented: “It hit this financial year because that was the year we sold it. It shouldn’t be and won’t be putting this kind f drag on the business going forward.”
Overall, Cloutier said he was very pleased with Brit’s 2012 results. He added: “It is certainly in line with our expectations given the significant year of change we have been through.”
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