Insurance group says positive results are due to new business and improved renewals

Insurance group Hastings made a profit before tax of £17.1m in the second quarter of 2014, up 90% on the £9m it made in the same period last year.   

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) also improved – up 18% to £26.3m compared with £22.2m in Q2 2013.

The organisation put the positive results down to significant increases in both renewals and new business volumes.

Hastings chief executive Gary Hoffman said: “The car insurance market remains extremely competitive but these results demonstrate how our agility and refreshingly straightforward proposition for customers continue to differentiate us and enable us to grow profitably and sustainably.

“We have achieved strong growth in customer numbers (up 27%) and gross written premiums (up 24%), and continue to make the right trade-offs between long-term value and short-term growth. Our distinctive model of optimising separate underwriting and retail operations ensures this.”

The group’s underwriting business boosted gross written premiums to 25% to £122.4m (Q2 2013: £98.2m). The group combined operating ratio of 86.9% for the second quarter was slightly worse compared to the same period last year (Q2 2013: 85.6%).

The broking arm of the business reported strong results for the second quarter, owing to the growth in policy count.

Adjusted EBITDA increased by 36% to £19.2m in Q2 2014 (Q2 2013: £14.1m) and by 43% for the first half of the year to £36m (H1 2013: £25.1m).

Hastings said the improved result in its retail arm reflected strong revenue growth offset by smaller increases in operating expenses.