Hiscox said it had achieved a record operating profit of £86.3m despite taking a £70m hit from the 2004 hurricane season.
Announcing its preliminary year-end results the company said gross written premiums had decreased from £797.4m in 2003 to £778.9m in 2004. Net earned premiums had increased from £547.5m in 2003 to £642.4m in 2004.
Final dividend payout per share increased by 21% to 5.0p per share from 4.2p a year earlier.
In its Lloyd's Syndicate 33 operating profit rose slightly to £63.5m from £61.5m in 2003. Combined ratio increased to 92.9% from 85.8% in 2003. The company said business had performed “exceptionally well” considering it had taken the “brunt of the weather-related catastrophes which impacted business.”
Hiscox said it did not anticipate its Lloyd's business aggregate growth in the short term. Capacity in 2005 would be £775m down from £846m in 2004. It said it has increased ownership in the Syndicate to 71% from 65% in 2004. The opening of a US office is expected to benefit the Syndicate in 2005 as it will contain Lloyd's security for the operation.
UK retail business increased operating profit to £18.8m from £15m in 2003. Gross written premium grew to £175.7m (2003: £174.6 million), despite the loss of a £20m book of commodity business, it said.
Combined ratio decreased to 89.8% from 90.3% a year earlier. The figure exceeded the set target of between 95%-98%.
Hiscox chairman Robert Hiscox said the preliminary results had been “strong”.
Moving forward, he said, Hiscox would balance its retail business with the “more volatile” London business to manage the next stage of the cycle.
