Accident management group Helphire has reached a settlement with Allianz Cornhill and Prudential, following the recent Clark v Ardington Court of Appeal case.
Chairman Michael Symons will make the following statement at today's Annual General Meeting.
"I am pleased to announce that the new financial year has started well. The Group returned to profit in the second half of last year and has continued to trade increasingly profitably. Levels of business are in line with budget and a `pipeline' of new business opportunities has been assembled.
"The caseload of non-fault accident business in July was greater than that in January, which has historically been the busiest month of the year.
"Cash collection has continued to improve with monthly cash flow now being consistently positive. Bank borrowings currently stand at £2.6m and should fall to zero by December. This cash position has been created by both a continued improvement in the profile of claims settlement via the Association of British Insurers (ABI) Scheme and the resolution of issues relating to historic claims with all insurers.
"There is currently £6.9m of `old' debt, net of provision, outstanding. The release of provisions relating to these debts will be addressed and take place at the end of this financial year.
"We are pleased to announce that a financial settlement has now been reached with the Prudential Insurance Company and Allianz-Cornhill, the last remaining insurers involved in the recent Court of Appeal test cases.
"These agreements mean that settlement of historic debts and a co-operative working protocol for claims management on new claims has now been reached with all major motor insurers.
"The House of Lords is still considering a petition for leave to appeal certain aspects of the ruling in the test cases but these do not include legal challenges to the fundamental business process.
"Overall the levels of business from our historical activities have been very satisfactory and we are pleased by the interest shown in new products. After the difficulties of the last couple of years we are pleased to report to shareholders that our new protocols are working well. The necessary operational systems and relationships are now in place and give us confidence to continue developing new areas of cooperation with the general insurance industry.
"The Accident Management Association (AMA) has successfully negotiated a five per cent increase in car hire rates under the terms of the ABI Scheme effective from July 2002. Relationships between the accident management industry and motor insurers have continued to improve. Discussions between the Group and an increasing number of insurers in relation to the provision of services continue and some have started to refer business to the Group.
"The Group's auditors are now Deloitte & Touche following the Andersen's merger. The outlook for the first half of this financial year is good and the Group remains on track to meet its expectations. On this basis, it is intended to recommence the payment of dividends at the end of this financial year. The Group's interim results for this period will be announced in late November."
