Principal broking subsidiary Lockton Companies International turned loss into £18.9m profit in 2009/2010
Lockton is planning to transfer its insurance broking operations to a new company, Lockton Companies LLP, and enter the underwriting business through a recently established managing general agency (MGA), Companies House filings reveal.
Lockton’s principal broking subsidiary, Lockton Companies International, will become a holding company following the transfer and so will no longer trade.
Lockton established Lockton Companies LLP on 12 March and intends to transfer the business this financial year, subject to approval from the FSA. Lockton’s financial year runs to 30 April.
Separately, Lockton UK Ltd – the holding company for Lockton’s UK broking interests – established Northwood MGA on 7 April. “It is proposed that this vehicle be utilised for underwriting activities,” Lockton UK said in a Companies House filing. The MGA’s two directors are Lockton International chief executive Julian James and finance director David Whitewood.
Lockton Companies International made a profit for the year ended 30 April 2010 of £18.9m, compared to a loss of £3.6m the previous year. The main reasons for the difference were a £12.5m exceptional gain in 2009-2010 from the disposal of its Nottingham-based insolvency business, and exceptional administrative expenses in 2008-2009 of £6.5m.
Of those expenses, £2.04m was for severance and sign-on costs relating to the restructuring of LIGS, the service company for Lockton’s UK operations, and £4.03m was related to pension scheme losses.