6th Sep 2006 08:00
FBD Holdings PLC06 September 2006 Press Release INTERIM RESULTS ANNOUNCEMENT For half year ended 30th June 2006 2006 2005FINANCIAL HIGHLIGHTS €000's €000's •Gross written premiums 203,996 192,360 •Net earned premiums 173,166 164,515 •Operating profit * 75,721 86,849 •Profit on sale of land at La Cala 83,626 - •Profit before taxation 157,445 106,769 Cent Cent •Operating earnings per share * 173.11 192.07 •Interim dividend proposed per share 24.00 20.00 •Special dividend per share (paid) - La Cala land sale 160.00 - * Based on a longer term rate of investment return Commenting on the results, Philip Fitzsimons, Chief Executive, said: "The Group maintained its strong trading performance in the period and achievedan operating profit of €75.7m. The main contributor to this outcome was theunderwriting result. Premium income increased by 6%, driven by strong newbusiness volumes which more than offset the impact of reductions in premiumswhich customers enjoyed. Reduced premium levels have impacted on margins, whichcontinue to gravitate towards European norms. The profit on the sale of land at La Cala Resort in Spain made a significantcontribution to the Group's overall result. Shareholders have benefited from the special dividend arising on the La Calaland sale and from the increased interim dividend that has been declared. Theyhave also benefited from the positive impact on earnings per share arising fromthe buyback of 3.8m shares on June 28th 2006. All of our businesses continue to perform satisfactorily and we are confidentregarding the outcome for the full year. We continue to focus on maximisingreturns to shareholders." ENDS 6th September 2006 For Reference Telephone FBDPhilip Fitzsimons, Chief Executive 01 4093208Andrew Langford, Finance Director 01 4093208 Murray ConsultantsJoe Murray 01 4980300 FBD HOLDINGS PLC INTERIM STATEMENT FBD Holdings plc ("FBD" or "the Group") is pleased to report that it maintainedits strong trading performance in the half year ended 30th June 2006. Results Operating profit achieved by the Group in the period amounted to €75.7m (H12005: €86.8m), somewhat ahead of target, due to a better out-turn in our primaryunderwriting business. Total income amounted to €207.2m (H1 2005: €199.3m). It included net premiumsearned of €173.2m (H1 2005: €164.5m) and investment income (calculated on thebasis of longer term returns) of €23.8m (H1 2005: €21.8m), both of which arisein the Group's insurance underwriting business. The remaining €10.3m (H1 2005:€13.0m) represents the net income, i.e. after expenses, that arises in theGroup's non-underwriting activities. Expenses amounting to €131.5m (H1 2005: €112.5m) related to the Group'sunderwriting business. They consist of claim costs amounting to €108.5m (H12005: €91.7m) and operating expenses of €23.0m (H1 2005: €20.8m). Of the Group's operating profit, €65.4m (H1 2005: €73.8m) is attributable tounderwriting and €10.3m (H1 2005: €13.0m) to non-underwriting, as detailedbelow. Profit arising from the proceeds of the La Cala first tranche land sale,amounted to €83.6m. Short term fluctuations in investment returns amounted to €0.3m (H1 2005:€21.7m). The profit before taxation, after charging finance costs of €2.2m (H1 2005:€1.8m), was €157.4m (H1 2005: €106.8m). Operating earnings per share, based on longer term investment returns, amountedto 173.11c (H1 2005: 192.07c) in the period. Underwriting. Insurance underwriting (FBD Insurance) is the Group's primary business activity. Gross written premiums (i.e. before reinsurance) amounted to €204.0m (H1 2005:€192.4m), an increase of 6% on the corresponding 2005 period. This increase isattributable to strong volume growth which more than offset the negative impactof premium reductions which had been implemented in the preceding 12 months. Net earned premiums amounted to €173.2m (H1 2005: €164.5m), an increase of 5.3%. The net claims incurred charge, which is comprised of the movement in netoutstanding claims provisions of €13.8m (H1 2005: €13.6m) plus net claims paidof €94.7m (H1 2005: €78.1m) amounted to €108.6m (H1 2005: €91.7m). The increasedclaims charge, relative to first half 2005, reflects the increased exposurearising from growth in our policy numbers, combined with the particularly benignclaims outcome experienced in the comparative period. The claims charge,nonetheless, was within our budgeted range. Savings on prior year provisions hada considerable positive impact on the claims incurred charge, in keeping withrecent accounting periods. We anticipate that for the year as a whole, suchsavings will be on a par with 2005. Net operating expenses amounted to €23.0m (H1 2005: €20.8m). The additionalinvestment in the business infrastructure (i.e. staff, training, technology,facilities and marketing) necessary to deliver our growth objectives, resultedin increased expenses, as anticipated. The foregoing premium/claim/expenses figures resulted in an underwriting profitof €41.6m (H1 2005: €52.0m), which was somewhat better than budget. The net operating ratios for the period were: an underwriting loss ratio of62.7% (FY 2005: 60.9%), reflecting lower margins as a result of reductions inpremium rates; a net expense ratio of 13.2% (FY 2005: 11.9%); a combined ratioof 75.9% (FY 2005: 72.8%), which encompasses the aforementioned ratios. After crediting investment income of €23.8m (H1 2005: €21.8m), the operatingprofit of the Group's insurance business amounted to €65.4m (H1 2005: €73.8m). Non-underwriting The Group's non-underwriting activities embrace property development/leisure,financial services, and the investment of non-allocated capital ("capitalfund"). These interests performed to budget, contributing €10.3m (H1 2005:€13.0m) to operating profit. Property and Leisure interests, which include La Cala and Sunset Beach resortsin Spain and the Tower Hotel Group in Ireland, contributed €3.7m (H1 2005:€6.4m) to operating profits. The 2005 comparative figure included fees arisingon completion of a property related loan. Our property and leisure businesseshave performed satisfactorily in what continues to be a challenging environment. The Group's financial service businesses include insurance broking (FBDBrokers), life assurance/pension broking/ investment advice (FBD Life) andinstalment finance (Abbey Finance). These businesses contributed €2.8m. (H12005: €2.5m) to the half year figure. Investment returns on the capital fund amounted to €3.8m (H1 2005: €4.1m). Thisfund is invested in equities. Profit on Sale of Land at La Cala On 23 February 2006, Ranchos Reunidos S.A., a 100% subsidiary of the group,entered into a conditional agreement to sell a major portion of the buildingdevelopment land which it owned at La Cala Resort, Mijas, Costa del Sol, Spain,for a total consideration of €201,000,000. The consideration was constituted intwo parts, apportioned between two tranches of land. On 22 June 2006, the initial consideration payment of €100,000,000 arising onthe Tranche I land was received. The remainder of the Tranche I consideration,amounting to €21,000,000 is due to be received on 30 June 2007. The group hasrecognised a profit of €83,626,000 on the sale of the Tranche I development landin the six month period to 30 June 2006. The consideration, amounting to €80,000,000, for the Tranche II land, becomespayable at a later date, contingent on receipt of final planning approval fromthe Spanish Regional Planning Authority. Balance Sheet Total assets at 30th June 2006 amounted to €1,670.3m compared to €1,564.4m atyear end, an increase of 6.8% in the period. Equity shareholders' funds amountedto €450.6m (31/12/05: €476.1m). A buyback of 3.8m shares at a cost of €129.2mwas undertaken during the period. All of the shares purchased were cancelled. Inthe absence of the buyback, shareholders' funds would have grown by €104.3m. The downturn in investment markets that occurred in the run-up to 30th June 2006reversed somewhat in the final days of June and resulted in short termfluctuations in investment return of €0.3m and an investment return of €3.8m onthe capital fund. The balance sheet at the said date reflects this reality. Themarkets' recovery since 30th June 2006 has improved our investment position. Special Dividend When the Group announced in February 2006 that a conditional agreement had beenentered into for a La Cala land sale, as referred to above, shareholders wereadvised of the Board's intention to distribute the net cash proceeds arisingfrom the overall transaction. On foot of the proceeds received for the firsttranche of land on 22nd June 2006, a special dividend of €1.60 per share wasdeclared, amounting to €55m. This dividend was paid on 11th August 2006. Interim Dividend In the light of the Group's continued favourable results and the Board's statedintention to increase the proportion of earnings distributed to shareholders, aninterim dividend of 24.00c (H1 2005: 20.00c) per share has been decided on bythe Directors. This represents a 20% increase on the 2005 interim dividend. The interim dividend will be paid on 6th October 2006 to shareholders on theCompany's Register at the close of business on 15th September 2006. The interimdividend is subject to withholding tax ("DWT") except for shareholders who areexempt from DWT and who have furnished a properly completed Composite ResidentForm to the Company's Registrar. Outlook The Group is on schedule to deliver a performance for the year which we areconfident will fulfil expectations. In relation to our core underwriting business, the insurance environment inwhich we operate is one where competition is intense and premiums continue toreduce. Consequently, margins are being eroded, notwithstanding the fact thatinjury claims frequency and injury costs have remained at the improved levelsobtaining post the Motor Insurance Advisory Board ("MIAB"). Governmentdetermination to pursue the reforms which it has initiated is crucial todelivering the desired claims environment for insured and insurer alike.Combined ratios continue to gravitate towards European norms. This is as we haveanticipated and signalled. It must also be borne in mind that, arising from theimproved claims environment referred to earlier, insurers' claims incurredcharges have benefited from savings on prior year provisions. The foregoingfactors, which combine to create the particular nature of the Irish insurancemarket at this point in time, must be considered when budgeting for the futureand when planning ahead. It is against this backdrop that we have formulated and are implementingdevelopment plans for our insurance underwriting business. Our plans, as alreadymentioned, require an investment in people, in training, in technology, infacilities and in marketing, underpinned by efficient business processes andproper cost control. They are pivotal to achieving our business goals. Thesuccess of this strategy has been reflected in the strong growth in policynumbers over the past number of years. In relation to our non-underwriting businesses, we will continue to implementstrategies to maximise returns from our interests. Individual strategies,appropriate for each of these interests, will be adopted as circumstances andopportunities determine. In relation to the utilisation of capital, the Board is fully cognisant of therequirement to maximise it for the benefit of shareholders. The decision of theBoard to participate by way of a share buyback in the June 2006 share placing bythe Group's largest shareholder is evidence of a proactive approach to capitalmanagement. Likewise, the decision of the Board to distribute the net proceedsof the La Cala land sale indicates the Board's view that capital will notnecessarily be retained, merely for retention sake. The Group continues toinvestigate all opportunities to invest in the Group's primary business ofinsurance underwriting, or in related financial service activities. As in thepast, other options for use of capital are not ruled out if deemed to be in thebest interests of shareholders. With clearly defined objectives being pursued in all our business activities, weare confident regarding the outcome for the full year and remain focused onmaximising returns to shareholders. ENDS Note: Management will present these results to analysts at 9.30 am.today. A copy of the presentation will be posted on the Group's website,www.fbd.ie, at that time. FBD HOLDINGS PLC GROUP INCOME STATEMENT For half year ended 30th June 2006 Notes Half Year Half Year Year Ended Ended Ended 30/06/06 30/06/05 31/12/05 (Unaudited) (Unaudited) (Audited) €000's €000's €000's Turnover 403,286 263,463 531,747 Income Net premiums earned 173,166 164,515 332,371 Non underwriting 10,299 13,024 27,739operating income Investment income -longer term rate of return 23,773 21,781 44,435 207,238 199,320 404,545 Expenses Changes in insuranceliabilities net of reinsurance (13,816) (13,595) (38,809) Claims paid, net ofrecoveries from reinsurers (94,742) (78,132) (163,666) Other operating expenses (22,959) (20,744) (39,446) Operating profit 2 75,721 86,849 162,624 Profit on sale of land 4 at La Cala 83,626 - - Investment income -short term fluctuation 318 21,738 25,956 Finance costs (2,220) (1,818) (3,425) Profit before taxation 157,445 106,769 185,155 Income tax expense (34,845) (12,849) (23,701) Profit for the period 122,600 93,920 161,454 Attributable to: Equity holders of the parent 122,599 94,004 161,500 Minority interest 1 (84) (46) 122,600 93,920 161,454 Cent Cent CentEarnings per 60c ordinary share 321.99 237.41 416.09 Diluted earnings per60c ordinary share 318.92 234.04 411.45 FBD HOLDINGS PLC GROUP BALANCE SHEET At 30th June 2006 As at As at As at 30/06/06 30/06/05 31/12/05ASSETS Notes (Unaudited) (Unaudited) (Audited) €000's €000's €000's Property and equipmentLand and buildings 199,599 198,108 196,923Fixtures and fittings 13,759 9,638 13,302 213,358 207,746 210,225 Intangible assetsDeferred acquisition costs 13,043 10,590 11,849 InvestmentsInvestment property 59,916 48,800 48,856Investments held for trading 503,113 449,503 477,310Available for sale investments 47,071 31,758 47,290Investments held to maturity 13,768 13,740 13,740Deposits with banks 485,184 407,511 443,042 1,109,052 951,312 1,030,238 Inventories 59,484 56,977 62,496 Loans and receivables 158,073 139,151 141,673 Reinsurers' share of technical provisionsProvision for unearned premiums 20,347 19,927 19,412Claims outstanding 59,147 50,271 46,622 79,494 70,198 66,034 Cash and cash equivalents 37,747 36,553 41,897 Total assets 1,670,251 1,472,527 1,564,412 FBD HOLDINGS PLC GROUP BALANCE SHEET At 30th June 2006 As at As at As at 30/06/06 30/06/05 31/12/05EQUITY Notes (Unaudited) (Unaudited) (Audited) €000's €000's €000's Share capital 6 21,277 23,557 23,557Capital reserves 12,434 9,178 9,813Revaluation reserves 41,381 39,442 47,706Translation reserves 101 1,766 435Retained earnings 375,401 337,991 394,616 Shareholders' funds - equity interests 450,594 411,934 476,127 Preference share capital 2,923 2,923 2,923 Total shareholders' funds 453,517 414,857 479,050 Minority interests 6,424 6,293 6,423 Total equity 459,941 421,150 485,473 LIABILITIESTechnical provisionsProvision for unearned premiums 196,150 188,363 188,953Claims outstanding 725,738 677,834 699,397 921,888 866,197 888,350 Bank and other loans 100,803 77,149 99,831 Creditors 153,486 78,726 54,829 Deferred tax 32,077 29,305 33,873 Retirement benefit obligation 2,056 - 2,056 Total liabilities 1,670,251 1,472,527 1,564,412 FBD HOLDINGS PLC GROUP CASH FLOW STATEMENT For half year ended 30th June 2006 Half Year Half Year Year Ended Ended Ended 30/06/06 30/06/05 31/12/05 (Unaudited) (Unaudited) (Audited)Operating activities €000s €000s €000s Profit before taxationfor the period 157,445 106,769 185,155 Adjustments for: Losses (gains) on investmentsheld for trading and held tomaturity 3,186 ( 22,084) ( 41,031)Depreciation of property, plant and equipment 1,978 1,801 3,487Share-based payment expense 341 139 774Increase in technical provisions 21,029 18,379 44,696Retirement benefit charges - - ( 3,802)Profit on sale of land at La Cala (83,626) - - Operating cash flows before movement in working capital 100,353 105,004 189,279 Increase in receivables ( 31,350) ( 5,644) ( 4,274)Increase (decrease) in payables 64,418 ( 35,822) ( 22,863) Cash generated from operations 133,421 63,538 162,142 Income taxes paid ( 3,458) ( 4,949) ( 20,516) Net cash from operatingactivities 129,963 58,589 141,626 Investing activitiesInvestments held for trading ( 29,578) ( 87,650) ( 96,510)Investments available for sale 751 ( 299) ( 5,162)Sale (purchase) of lands, buildings & inventory 83,960 ( 8,025) ( 13,430)Purchase of fixtures &fittings ( 5,248) ( 892) ( 6,242)Purchase of investment property ( 11,060) ( 24,600) ( 24,656)Loans and advances 13,755 1,403 (3,789)Deposits invested withfinancial institutions ( 42,142) 130,909 95,378 Net cash from (used in)investing activities 10,438 10,846 ( 54,411) Financing activitiesDividends paid ( 14,446) ( 10,466) ( 18,158)Repurchase of shares ( 129,212) ( 81,238) ( 81,238)Proceeds of re-issue ofordinary shares 414 617 1,409(Decrease) increase inbank loans ( 973) 5,448 1,243Net cash used in financing activities ( 144,217) ( 85,639) ( 96,744) Net decrease in cash and cash equivalents ( 3,816) ( 16,204) ( 9,529)Cash and cash equivalents at the beginning of the period 41,897 51,362 51,362Effect of foreign exchange rate changes ( 334) 1,395 64 Cash and cash equivalents at the end of the period 37,747 36,553 41,897 FBD HOLDINGS PLC GROUP STATEMENT OF CHANGES IN EQUITY For half year ended 30th June 2006 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Balance at 1 January 2005 25,151 7,445 38,581 371 334,905 406,453 Preference Minority Total share interests €000s capital €000s €000s Balance at 1January 2005 2,923 16,333 425,709 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Profit aftertaxation - - - - 94,004 94,004 Preference Minority Total share interests €000s capital €000s €000s Profit aftertaxation - (84) 93,920 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Exchangetranslationadjustment - - - 1,395 - 1,395 Preference Minority Total share interests €000s capital €000s €000s Exchangetranslationadjustment - - 1,395 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Ordinarydividends paid - - - - (10,298) (10,298) Preference Minority Total share interests €000s capital €000s €000s Ordinarydividends paid - - (10,298) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Buyback of ownshares - - - - (81,238) (81,238) Preference Minority Total share interests €000s capital €000s €000s Buyback of ownshares - - (81,238) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Cancellationof own shares (1,594) 1,594 - - - - Preference Minority Total share interests €000s capital €000s €000s Cancellationof own shares - - - Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Reissue ofordinaryshares - - - - 618 618 Preference Minority Total share interests €000s capital €000s €000s Reissue ofordinaryshares - - 618 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Recognition ofshare basedpayments - 139 - - - 139 Preference Minority Total share interests €000s capital €000s €000s Recognition ofshare basedpayments - - 139 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Transfer toincome statement onsale ofavailable-for-saleinvestments - - (5,583) - - (5,583) Preference Minority Total share interests €000s capital €000s €000s Transfer toincomestatement onsale ofavailable-for-saleinvestments - - (5,583) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Gain onavailable-for-saleinvestments - - 6,444 - - 6,444 Preference Minority Total share interests €000s capital €000s €000s Gain onavailable-for-saleinvestments - - 6,444 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Purchase ofminorityinterests - - - - - - Preference Minority Total share interests €000s capital €000s €000s Purchase ofminorityinterests - (9,956) (9,956) Balance at 30June 2005 23,557 9,178 39,442 1,766 337,991 411,934 Preference Minority Total share interests €000s capital €000s €000s 2,923 6,293 421,150 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Balance at 1January 2006 23,557 9,813 47,706 435 394,616 476,127 Preference Minority Total share interests €000s capital €000s €000s 2,923 6,423 485,473 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Profit aftertaxation - - - - 122,599 122,599 Preference Minority Total share interests €000s capital €000s €000s - 1 122,600 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Exchangetranslationadjustment - - - (334) - (334) Preference Minority Total share interests €000s capital €000s €000s - - (334) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Ordinarydividends paid - - - - (14,277) (14,277) Preference Minority Total share interests €000s capital €000s €000s - - (14,277) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Buyback of ownshares - - - - (129,212) (129,212) Preference Minority Total share interests €000s capital €000s €000s - - (129,212) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000sCancellationof own shares (2,280) 2,280 - - - - Preference Minority Total share interests €000s capital €000s €000s - - - Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Reissue ofordinaryshares - - - - 414 414 Preference Minority Total share interests €000s capital €000s €000s - - 414 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Recognition ofshare basedpayments - 341 - - - 341 Preference Minority Total share interests €000s capital €000s €000s - - 341 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Transfer toincomestatement onsale ofavailable-for-saleinvestments - - (6,856) - - (6,856) Preference Minority Total share interests €000s capital €000s €000s - - (6,856) Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Gain onavailable-for-saleinvestments - - 531 - - 531 Preference Minority Total share interests €000s capital €000s €000s - - 531 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Deferred taxon insurancecontracts - - - - 1,261 1,261 Preference Minority Total share interests €000s capital €000s €000s - - 1,261 Share Capital Revaluation Translation Retained Attributable capital reserves and other reserve earnings to ordinary €000s €000s reserves €000s €000s shareholders €000s €000s Balance at 30June 2006 21,277 12,434 41,381 101 375,401 450,594 Preference Minority Total share interests €000s capital €000s €000s 2,923 6,424 459,941 FBD HOLDINGS PLC SUPPLEMENTARY INFORMATION For half year ended 30th June 2006 Note 1 Accounting policies The accounting policies used by the Group to prepare the interim financialstatements for the six month period ended 30 June 2006, are the same as thoseused to prepare the annual financial statements for the year ended 31 December2005. Note 2 Operating profit by activity Half Year Ended Half Year Ended Year Ended 30/06/06 30/06/05 31/12/05 (Unaudited) (Unauditied) (Audited) €000s €000s €000s Underwriting 65,422 73,825 134,885 Non underwriting 10,299 13,024 27,739 75,721 86,849 162,624 Note 3 Underwriting result Half Year Ended Half Year Ended Year Ended 30/06/2006 30/06/2005 31/12/2005 €000s €000s €000s Gross written premiums 203,996 192,360 389,472Net earned premiums 173,166 164,515 332,371Net claims incurred ( 108,558) ( 91,727) ( 202,475)Net operating expenses ( 22,959) ( 20,744) ( 39,446) Underwriting result 41,649 52,044 90,450 Note 4 Profit on sale of land at La Cala On 23 February 2006, Ranchos Reunidos S.A., a 100% subsidiary of the group,entered into a conditional agreement to sell a major portion of the buildingdevelopment land which it owned at La Cala Resort, Mijas, Costa del Sol, Spain,for a total consideration of €201,000,000. The consideration was constituted intwo parts, apportioned between two tranches of land. On 22 June 2006, the initial consideration payment of €100,000,000 arising onthe Tranche I land was received. The remainder of the Tranche I consideration,amounting to €21,000,000 is due to be received on 30 June 2007. The group hasrecognised a profit of €83,626,000 on the sale Tranche I development land in thesix month period to 30 June 2006. The consideration, amounting to €80,000,000, for the Tranche II land, becomespayable at a later date, contingent on receipt of final planning approval fromthe Spanish Regional Planning Authority. FBD HOLDINGS PLC SUPPLEMENTARY INFORMATION For half year ended 30th June 2006 (continued) Note 5 Dividends Half Year Half Year Year Ended Ended Ended 30/06/2006 30/06/2005 31/12/2005 (Unaudited) (Unaudited) (Audited) €000s €000s €000s Paid in Period 2005 Interim dividend of20.00c per share on ordinaryshares of 60c each - - 7,578 2005 Final dividend of 37.50c(2004 27.28c) per share onordinary shares of 60c each 14,277 10,298 10,298 Dividend of 8.4c per share on14% non-cumulative preferenceshares of 60c each - - 113 2005 Dividend of 4.8c (2004:4.8c) per share on 8%non-cumulative preference shares of 60c each 169 169 169 14,446 10,467 18,158 Proposed: 2005 Dividend of 8.4c pershare on 14% non-cumulativepreference shares of 60c each - - 169 2005 Final dividend of 37.50cper share on ordinary sharesof 60c each - - 14,277 2006 Interim dividend of24.00c (2005: 20.00c) pershare on ordinary shares of60c each 8,247 7,578 - Special dividend of 160.00cper share on ordinary sharesof 60c each 54,978 - - 63,225 7,578 14,446 Note 6 Share capital Half Year Ended Half Year Ended Year Ended 30/06/2006 30/06/2005 31/12/2005 (Unaudited) (Unaudited) (Audited) Number €000s €000s €000s AuthorisedAt beginning and end of period/year: Ordinary shares of 60c each 51,326,000 30,796 30,796 30,796 Issued and fully paid: At beginning of period/year 39,261,206 23,557 25,151 25,151 Cancellation of shares ( 3,800,000) ( 2,280) ( 1,594) ( 1,594) At end of period/year 35,461,206 21,277 23,557 23,557 The total number of shares held as treasury shares at 30 June 2006 was 1,099,900. 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