TIDM32OW
RNS Number : 1474U
Brit Limited
29 July 2022
Brit Limited
PRESS RELEASE
29 July 2022
interim results for the six months ended 30 june 2022
A STRONG UNDerWRITING performance and significant growth
-- Gross written premiums of $1,990.5m (H1 2021: $1,464.4m), a
35.9% increase (37.6% at constant FX rates).
-- Risk adjusted premium rates increases of 12.1% (H1 2021:
10.2%). Premium rate increases since 1 January 2018 of 45.2%.
-- Net earned premium(1) of $1,249.0m (H1 2021: $876.0m), an
increase of 43.9% at constant FX rates.
-- Attritional ratio(1) of 51.7%, an improvement of 1.5pps (H1
2021: 50.2%), with most classes showing a strong underlying
performance.
-- Combined ratio(1,2) of 91.6% (H1 2021: 95.5%), including
3.2pps of Ukraine related losses (H1 2021: 1.3pps of COVID-19
related losses), no other major losses (H1 2021: 9.3pps) and
reserve movements of 0.7pps (H1 2021: (4.7)pps).
-- Return on invested assets (3) after fees of $233.4m negative
for H1 2022, representing a non-annualised return of
-4.3% (H1 2021: positive return of $168.9m/+3.4%). This included
$221.8m of unrealised losses.
-- Operating loss before the impact of FX and tax of $166.0m (H1 2021: profit of $208.6m).
-- Loss after tax of $186.9m (H1 2021: profit of $204.3m).
-- RoNTA(4) (non-annualised) of -10.2% (H1 2021: +16.1%).
-- Balance sheet remains strong: Adjusted net tangible assets(5)
of $1,534.5m (31 December 2021: $1,740.6m).
-- Capital ratio(6) improved to 157.1% (31 December 2021:
139.1%). Capital surplus increased by $100.0m to $717.9m (31
December 2021: $617.9m)
-- Ki continued its success, maintaining its growth trajectory
with $342.9m of GWP recognised in the six months.
Martin Thompson, Interim Group Chief Executive Officer of Brit
Limited, commented:
'We are pleased to report an excellent underwriting result for
the first half of 2022 with a combined ratio 91.6%. This is
testament to Brit's clear focus on underwriting performance,
supported by excellent client service and our ongoing investment in
an innovation and data-led approach. With market volatility, rising
inflation and the devastating invasion of Ukraine, the first half
of 2022 has presented numerous and significant risks for our
clients, and going into the second half of 2022 many of these risks
and uncertainties will persist. However, we continue to see
favourable pricing developments and this, alongside Brit's strong
financial position, means we are well placed to navigate this
climate, and support clients in managing and protecting themselves
against these and any other emerging risks.'
'Alongside supporting clients in navigating this landscape, the
remainder of 2022 will also see us continue to drive progress in
some of the areas that matter most to us and our employees - namely
technology and innovation, and inclusion and diversity. The coming
six months will see us further build and enhance our innovative and
data driven underwriting platform, while also continuing to foster
and support an inclusive and diverse culture at Brit.'
Notes
1 Includes the effect of foreign exchange on non-monetary items.
30 June 2021 figures have been represented on this basis.
2 Include FX movements on non-monetary items, the impact of
gains/losses on other financial liabilities but exclude any
adjustment for non-controlling interests. 30 June 2021 figures have
been represented on this basis.
3 Inclusive of return on investment related derivatives, return
on associates and after deducting investment management
expenses.
4 Return on net tangible assets (RoNTA) shows the return
generated by our operations for the owners of Brit Limited before
foreign exchange movements, compared to the adjusted net tangible
assets (see footnote 5) deployed in our business attributable to
them. The impact of the Group's defined benefit pension schemes are
excluded from the calculation. The 30 June 2021 figure is
represented on this basis.
5 Adjusted net tangible assets are defined as total equity, less
intangible assets net of the deferred tax liability on those
intangible assets, less non-controlling interest.
6 The capital ratio is calculated as total available resources
divided by management entity capital requirements. The management
entity capital requirement is the capital required for business
strategy and regulatory requirements.
Officer statements
I am pleased to report that our strategy has delivered an
excellent underwriting performance for the first half of 2022 with
a strong combined ratio of 91.6% for the period. This primarily
reflected the combination of a healthy attritional ratio, partly
offset by the impact of the Ukraine crisis, for which we have
established a provision of $39.6m.
Brit has been shocked and horrified by the unfolding events in
Ukraine. Brit's thoughts are with its people and our Fairfax
colleagues based there. Brit and its staff have also supported The
Red Cross Ukraine Crisis Appeal.
I am also pleased that, alongside delivering a strong
underwriting result, we were able to grow our premium written to
$1,990.5m (2021: $1,464.4m), an increase of 35.9%, or 37.6% at
constant rates of exchange. Our core direct and reinsurance
divisions contributed to this growth as did Ki in its second year
of trading.
The development of Ki continues apace, gaining significant
traction in the market. In the period, it wrote $342.9m of premium,
an increase of 203.6% at constant FX rates over its first six
months of trading.
Market conditions have also contributed to Brit's premium growth
. We achieved risk adjusted rate increases of 12.1%, driven by the
rising cost of reinsurance and market pressure on liability lines
primarily reflecting social inflation. This gives a total overall
increase since 1 January 2018 of 45.2%.
As with the wider insurance market, our overall result was
impacted by the volatility of financial markets and its impact on
our investment return.
During the first half we made a number of important senior
appointments, including Bilge Mert as Chief Technology Officer and
Kanika Chaganty as Chief Data Officer. These appointments support
our technology and data strategy to further advance the business'
focus on delivering an innovative, data-driven and technology
empowered platform that enables our underwriting and claims teams
to thrive. We also made a number of key underwriting and business
development appointments.
Our ability to deliver a best-in-class claims service continues
to be a core focus. We have supported our clients when they need it
most, with innovation at the heart of our claims approach,
including launching Brit Direct Pay, our claims payment solution,
to our US clients. We were also delighted that Brit Private Client,
18 months since launch, took overall first place in the Highpoint
High Net Worth Insurer Survey, showing that our proposition of
underwriting, claims and service excellence has been welcomed by
the market.
We are proud of Brit's unique culture and we have continued to
make progress against our inclusion and diversity roadmap, focusing
on our ongoing commitment to attract and retain diverse talent and
support a culture of inclusion. We have continued with our
wide-ranging educational and awareness programme and have partnered
with GT Scholars, a UK based social enterprise to help young people
from all backgrounds access career opportunities in insurance and
build their employability skills.
Going into the second half of 2022, the industry faces a number
of challenges and uncertainties, driven by the volatile
geopolitical and economic landscapes, including inflationary
pressures and ongoing supply chain issues. Wider challenges also
continue to exist such as the potential for increased frequency and
magnitude of major loss events, excess capacity, the cost of doing
business in the London Market, and increased competition from local
carriers in some markets. However, against this backdrop we believe
we are well positioned to respond to the opportunities and
challenges ahead.
Martin Thompson
Interim Group Chief Executive Officer
27 July 2022
In the first half of 2022, Brit delivered a strong underwriting
result, offset by the impact of the global financial market
volatility on our investment portfolio. Brit's operating result
before FX and tax was a loss of $166.0m and our non-annualised
return on net tangible assets was -10.2%.
Underwriting profit was $104.9m, with a combined ratio of 91.6%.
The attritional ratio for the period was 51.7%, reflecting good
underwriting discipline, rigorous risk selection, and healthy
compound rate increases.
Major losses of $39.6m contributed 3.2pps (2021: $93.0m/10.6pps)
to the combined ratio, and related to provisions established as a
result of the shocking events in Ukraine. This follows an
assessment of direct exposures within the Terrorism, Casualty
Treaty, Marine War, Contingency and Political and Credit Risk
classes, along with potential secondary impacts. Brit does not
write Aviation business. Given the ongoing nature of the event,
neither the duration nor the ultimate outcome can be predicted with
any certainty, and we continue to monitor the situation
closely.
In the period, as part of our quarterly reserving process we
released $6.1m (0.5%) of attritional prior year reserves. These
releases were offset by a modest strengthening in respect of
historic cat events ($14.7m/1.2%), resulting in an overall increase
of $8.6m/0.7% in our prior year reserves. The structure of our
reinsurance protections means that any further downside to these
events is limited.
Our return on invested assets net of fees was a negative $233.4m
or -4.3 % (non-annualised), including $221.8m of unrealised losses,
with equities, funds and fixed income each contributing to the
result. The result reflects the reaction of investment markets to
the conflict in Ukraine, with US government bond yields increasing
significantly and US and European investment grade credit and high
yield spreads widening during the period. It was also the worst
first half of the year for developed markets equities in over 50
years.
Our balance sheet remains strong, with adjusted net tangible
assets of $1,534.5m (31 December 2021: $1,740.6m) . Our management
capital surplus increased to $717.9m or 57.1% (31 December 2021:
$617.9m/39.1%) over our Group management capital requirement of
$1,256.6m (31 December 2021: $1,581.6m), reflecting the impact of
the movement in interest rates on our capital requirements, partly
offset by the result for the period.
Our investment portfolio remains conservatively positioned, with
a large allocation to cash and cash equivalents ($1,071.3m or
20.4%) and fixed income securities ($3,379.3m or 66.3%). Brit's
equity allocation stands at $671.6m, or 12.8%. At 30 June 2022,
80.6% of our invested assets were investment grade and the duration
of the portfolio had increased to 1.8 years.
We remain cognisant of the potential impacts of inflation, with
work being undertaken collaboratively across the Group to quantify
and mitigate its impact on profitability. We also continue to focus
on ensuring that our underwriting and pricing adequately addresses
inflationary trends and we continue to review the key drivers of
claim settlement costs and frequency by class of business. Our
reserves continue to be set at a margin above the actuarial
estimate which is in turn set on a conservative best estimate basis
incorporating our current view of social and economic
inflation.
We are making good progress with our project to implement IFRS
17, the new accounting standard for insurance contracts applicable
from 1 January 2023. In the first half of 2022 the Company's
efforts focused on the finalisation and documentation of key
accounting policies and significant estimates, and the
implementation and testing of information technology systems
support the production of figures on an IFRS 17 basis. The company
is currently refining its opening consolidated IFRS 17 balance
sheet as at 1 January 2022 and continues to evaluate the effect
that the adoption of IFRS 17 will have on its consolidated
financial statements.
We have continued to experience strong underwriting conditions
and favourable market developments in the first half of 2022.
However, the world faces ongoing volatility, challenges arising
from inflation, and uncertainty surrounding events in Ukraine. The
insurance market also continues to evolve. However, we believe that
our strategy, discipline and financial strength position us well to
take advantage of opportunities as they arise.
Gavin Wilkinson
Group Chief Financial Officer
27 July 2022
Brit Limited 2022 Interim Report
Brit Limited's 2022 Interim Report is available at
www.britinsurance.com .
For further information, please contact:
+44 (0) 20 3857
Antony E Usher, Group Financial Controller, Brit Limited 0000
+44 (0) 20 3727
Edward Berry, FTI Consulting 1046
+44 (0) 20 3727
Tom Blackwell, FTI Consulting 1051
About Brit Limited
Brit is a market leader in global specialty insurance and
reinsurance, writing a broad range of commercial insurance. Brit is
a highly regarded and an influential name in the Lloyd's market and
we pride ourselves on our specialist underwriting and claims
expertise.
We operate globally via a combination of our own international
distribution network that benefits from Lloyd's global licences,
and through our broker partners. Our underwriting capabilities are
underpinned by a strong financial position, our underwriting
expertise and discipline and customer service, enhanced by a data
led approach and strong focus on innovation.
We have a strong track record and are passionate about our
business, our people and our clients and we have focused on
cultivating a franchise that is built on delivering exceptional
service. Our culture is centred on achievement and we have
established a framework that identifies and rewards strong
performance.
Brit is a member of the Fairfax Financial Holdings Limited group
of companies (Fairfax). The Fairfax financial result for the six
months ended 30 June 2022, published on 28 July 2022, includes the
Brit financial result.
www.britinsurance.com
Disclaimer
This press release does not constitute or form part of, and
should not be construed as, an offer for sale or subscription of,
or solicitation of any offer or invitation or advice or
recommendation to subscribe for, underwrite or otherwise acquire or
dispose of any securities (including share options and debt
instruments) of the Company nor any other body corporate nor should
it or any part of it form the basis of, or be relied on in
connection with, any contract or commitment whatsoever which may at
any time be entered into by the recipient or any other person, nor
does it constitute an invitation or inducement to engage in
investment activity under Section 21 of the Financial Services and
Markets Act 2000 (FSMA). This document does not constitute an
invitation to effect any transaction with the Company or to make
use of any services provided by the Company. Past performance
cannot be relied on as a guide to future performance.
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END
IR PPUGPMUPPGAR
(END) Dow Jones Newswires
July 29, 2022 02:00 ET (06:00 GMT)
Brit 3.6757% (LSE:32OW)
過去 株価チャート
から 5 2024 まで 6 2024
Brit 3.6757% (LSE:32OW)
過去 株価チャート
から 6 2023 まで 6 2024
