28th Mar 2024 11:11
(Alliance News) - Chesnara PLC is well placed to pick up further insurance portfolios backed by a strong balance sheet, Panmure Gordon analyst Abid Hussain said on Thursday.
Shares in Chesnara rose 1.2% to 265.00 pence in London on Thursday morning.
Hussain was commenting after Chesnara, the Preston, England-based insurance company and pension consolidator said it swung to a pretax profit of GBP1.3 million in 2023 from a pretax loss of GBP62.1 million the year before.
This includes a net insurance service loss of GBP5.1 million and an investment result of GBP71.7 million, which compares to a GBP13.3 million profit and a loss of GBP39.0 million respectively a year ago, the company explained.
Chesnara also posted a 1.3% rise in insurance revenue to GBP228.0 million from GBP225.1 million a year prior.
The firm proposed a total dividend of 23.97p per share, up 3.0% from 23.28p in 2022.
Looking ahead, Chesnara affirmed that it sees more positive signs for a return to normality regarding macro-economic conditions.
Chief Executive Officer Steve Murray said: "We remain confident in our ability to finance and execute transactions on attractive terms for both vendors and our shareholders and deliver positive outcomes for customers."
Hussain said they were a "good set" of figures with highlights including "underlying cash generation growth, liquidity and balance sheet strength."
He pointed out Chesnara has over GBP200 million of "readily available firepower" for M&A along with ample management bandwidth despite recent acquisitions.
Hussain said he gets the sense management may be willing to participate in larger M&A than in the recent past, especially if traditional competitors and private equity houses are focused elsewhere.
He believes now would be a sensible time to be an acquirer as life insurers continue to deal with inflation, legacy systems and operational challenges.
Hussain reiterated a 'buy' rating and 420p per share price target.
He noted the dividend was increased for the 19th year in a row with further growth expected.
By Jeremy Cutler, Alliance News reporter
Comments and questions to [email protected]
Copyright 2024 Alliance News Ltd. All Rights Reserved.
Related Shares:
Chesnara