Beazley kicked off the Lloyd’s results season reporting that its profits were down by 25% for the first half of 2008, falling to £45m compared to £60.2m for the same period last year.
Beazley blamed the profit fall on a sharp reduction in investment income.
Gross written premiums were down 6% to £407.3m, from £434.1m last year with the earnings per share dropping to 9.1p from 11.6p. Beazley released £23.4m of prior year reserves over the six-month accounting period.
Chief executive Andrew Beazley said that despite the challenging nature of the past six months, the result was consistent with the company’s record of unbroken profitability. He added: “It is a very difficult time in the investment market.”
Andrew Horton, finance director and incoming chief executive, said he expected premiums to be less in 2009, but expected growth in the insurer’s US business.
Fairfax Financial Holdings, a Canadian financial services holding group, has launched a £67m bid for London and Bermuda based insurer Advent.
The bid, announced today to the Stock Exchange, values Advent at 165p per share in cash. Shares in the insurer closed at 165p on Monday, the day before the offer, but its net assets were valued far higher, at 240p per share, in its interim results, released this week.
The results saw profits tumble to £1.6m for the first half of 2008, down from £6.7m for the same period last year.
Keith Thompson, chief operating officer, said a series of large, single-risk property losses during the first quarter of the year had affected the business.
Gross written premiums, excluding the reinsurance to close premium, increased by 25% to £111.7m from £89.3m. The insurer’s first-half underwriting profit stood at £894,000 compared to £4.42m in 2007, and the combined ratio deteriorated to 99% from 89.6%.