Cox Insurance Holdings' full year results showed an overall loss of £201m loss for 2001. However, they also showed a significant improvement in its retail division's financial performance with a 70% increase in operating profits to £36.7m from £21.5m.
The £201m loss reflects the group's WTC losses and its withdrawal from commercial lines underwriting, except nuclear and aviation, last year. The group is now concentrating on its retail business.
The company also announced plans to raise £73m before expenses through a placing and open offer at 41 pence per share.
The proceeds will be used primarily to support future underwriting of its retail business, as well as to provide additional working capital for the group and to repay indebtedness.
It said: "Of the £65 million net proceeds received from the equity capital raising the on-going Retail business will receive £50 million to support its underwriting. This underwriting will be through a new vehicle at Lloyd's to be called Cox Underwriting Limited (CUL)."
The group has entered a conditional agreement for a cash placing of new ordinary shares with Esure Insurance which will result in Esure having an interest in 1.3% of Cox. Esure was launched last year as a joint venture between Peter Wood, the founder of Direct Line, and HBOS.
Chairman Peter Owen commented: "With the restructuring of the group now almost complete, a line is being drawn underneath a very challenging year for Cox. The group's retail activities continue to move from strength to strength and with another year of excellent results in 2001, we look forward to building on this success to develop the group going forward."
