3rd Mar 2022 13:08
(Alliance News) - Admiral Group PLC on Thursday reported strong profit growth in 2021 as the insurer was able to write more premiums thanks to an increased number of motor customers in the UK.
Shares in the FTSE 100-listed firm - which sells home and car insurance and personal loans - were down 13% in London on Thursday afternoon at 2,580.92 pence each.
In 2021, Cardiff-based Admiral recorded pretax profit of GBP713.5 million, up 17% from GBP608.2 million in 2020.
Turnover increased by 4.2% to GBP3.51 billion from GBP3.37 billion. Group insurance premium revenue rose 9.7% to GBP2.49 billion from GBP2.27 billion.
Admiral's underwriting profit including investment improved 4.2% to GBP347.0 million from GBP333.1 million. The company's combined ratio, however, worsened to 85.2% from 81.2%. Any ratio below 100% indicates profit from underwriting operations, so the lower the better.
In the UK Insurance unit, total premiums written improved to GBP2.75 billion from GBP2.67 billion, with net insurance premium revenue up to GBP612.6 million from GBP539.7 million. Admiral noted GBP2.24 billion of the unit's premiums came from its UK Motor business, which is up from GBP2.19 billion in 2020. The business insured 4.97 million vehicles at the end of 2021, up from 4.75 million 12 months earlier.
"I closed my 2020 review hoping for a more cheerful 2021, and whilst the pandemic again put paid to that and Wales didn't win the Euros, Admiral's financial performance was strong, with all our businesses growing customer numbers year-on-year along with a very positive bottom-line outcome for the group," Chief Financial Officer Geraint Jones said.
Admiral ended 2021 with 8.36 million customers, up from 7.66 million at the same point the year before.
The insurer increased its dividend to 187.0 pence from 156.5p in 2020 and also paid out a 92.0p special dividend following the sale of its Penguin Portals Comparison business.
Chief Executive Milena Mondini de Focatiis said: "In 2021 we improved in all of our key metrics, including exceeding 8 million customers, increasing customer loyalty and recording exceptional profits of GBP769 million.
The CEO said Admiral's performance in 2021 was driven by its UK Motor insurance business.
"In 2021 alone, beyond UK Motor we added more than half a million customers, now representing around 40% of total group customers. We grew by double digits in both our UK Household and International businesses, despite challenging market conditions abroad, and our Loans stock balance is now larger than pre-Covid levels," de Focatiis said.
"We are pleased to see the results of our ability to export some of our competitive advantages to these new businesses and we are also planting seeds for further diversification in the longer term through Admiral Pioneer, for example with small business insurance."
By Paul McGowan; [email protected]
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