The RSA Insurance Group Plc reported a 15 percent decline in revenue for the first quarter after the U.K.’s biggest non-life insurer by market value sold assets to bolster its balance sheet.
Net written premiums, a measure of sales, fell to £1.98 billion ($3.358 billion) in the three months to March 31, compared with €2.3 billion [$3.9 billion] a year earlier, according to a statement today. The London-based company said it continues to expect full-year premiums to be 10 percent lower than in 2013.
“We have taken action to address underperforming portfolios, the results of which can be seen” in the numbers, said new Chief Executive Officer Stephen Hester in the statement. “Underlying premium and profit trends are generally in line with our expectations.”
Hester, the former CEO of Royal Bank of Scotland Group Plc, was hired in the wake of three profit warnings in the fourth quarter and an accounting scandal in Ireland. Since succeeding Simon Lee in February, he has overseen a $1.3 billion rights issue, scrapped the dividend and sold assets in Europe to restore the balance sheet.
RSA reported lower revenue across all its main markets including Scandinavia, Canada and Latin America. Net written premiums in the U.K. and Western Europe, where most of the insurer’s restructuring of its business is taking place, tumbled 18 percent to £785 million [$1.331 billion].
The insurer, which operates in 32 countries including the Middle East and Asia, has earmarked further assets sales this year.
PZU SA, central Europe’s largest insurer by market value, last month agreed to pay a combined €360 million ($501 million) for four of RSA’s businesses in Lithuania, Latvia, Estonia and Poland.
RSA’s shares have jumped 21 percent this year, making it the best performing stock in the 20-member FTSE 350 Insurance Index. The stock sank 29 percent last year, erasing €1.3 billion [$2.2 billion] of market value. The shares were little changed at 98 pence [$1.66] in London trading at 8:28 a.m. today.